16 March 2009

TVNZ Identifies $25 Million In Cost Reductions & Savings

TVNZ today announced to its staff its plan to achieve $25 million in cost reductions and savings.

TVNZ Chief Executive Rick Ellis said cost reductions and savings would be made from the programme budget, departmental operating budgets and from about 90 proposed redundancies.

The proposed payroll cost reductions represent approximately 25 percent of the cost reductions. Departmental operating budgets had been reduced by approximately 10 percent. The cuts to programme commissioning budgets equates to about 100 hours or approximately 3 percent of local content hours. The impact on TV ONE and TV2 prime time schedules is not expected to be material. The News and Current Affairs programme line-up will remain unchanged.

The proposed redundancies come from across the business including Technology, Finance & Legal, Support Services, HR, Corporate Affairs, Broadcast Services, Marketing, Television, Sports, News and Current Affairs. There are limited redundancies in Sales and none in Emerging Business (on-line and licensing) because they are the revenue earning and growth areas of the company.

There will be a salary freeze for the CEO, executive team and senior managers.

Mr Ellis said staff had come up with a number of cost reduction and savings ideas and many were being actioned.

He said there had been the suggestion to reduce to a four day week or a nine day fortnight. Unfortunately in most parts of the business, given its complexity, this wasn’t practical. Even so, a small number of people may agree to move to a four day working week and others may change from full-time to part-time.

Finding the right mix of savings to get to the $25 million target had been a difficult balancing act.

He said the outlook was uncertain for advertising-reliant media around the world.

“That’s why TVNZ will be accelerating its strategy to transform the business from a traditional analogue advertising-reliant broadcaster to that of a multi-platform digital media company with diverse income streams.”

ENDS

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