Grappling with ratings doldrums and increased competition, Turner Broadcasting plans to cut several hundred workers as part of an overhaul of its operations.
On Tuesday, the Atlanta cable TV programmer notified employees that it was offering buyouts to older workers who have been with the company at least 10 years. The unit, which employs more than 13,000 people worldwide, is planning further staff cuts to focus resources on areas of growth.
Turner Broadcasting comprises such channels as
The Turner networks long have been sturdy revenue engines, but in recent years have been eclipsed by competitors — including
The voluntary buyouts are being offered to fewer than 600 U.S.-based employees over age 55. It is the first step of a comprehensive restructuring that was initiated three months ago by recently installed Turner Chief Executive John Martin.
"We'll start 2015 a more streamlined, nimble and efficient company focused on driving programming, monetization and innovation, in a culture that emphasizes and rewards continuous improvement," Martin said in an email to employees last week.
Turner is a unit of media company
Time Warner Chief Executive Jeff Bewkes and other board members refused to entertain discussions with Murdoch, so now the company is under pressure from Wall Street to demonstrate that remaining independent is a superior strategy. Analysts are looking for Time Warner to provide details on how it intends to grow its profits and stock price.
The company has signaled to Wall Street that it will make cuts companywide, but Turner is the first to initiate the process and is likely to suffer the bulk of the cuts. Time Warner also owns Hollywood's largest movie and TV studio,
Fox's short-lived pursuit caused Time Warner's stock to soar; it traded above $85 a share for a few days last month. After Fox pulled its offer, Time Warner shares plummeted, irritating some investors.
Nonetheless, Time Warner shares rose 3 cents Tuesday to $76.98, 8% higher than when the Fox offer became public.
Analysts have looked at several scenarios for Time Warner to increase its profits. Among them is being more aggressive with its delivery of HBO, including offering the channel as a stand-alone Internet service similar to
In early June, Time Warner spun off its magazine unit
The Turner networks produce more than a third of Time Warner's revenue. In the most recent fiscal quarter, Turner generated $2.75 billion of Time Warner's $6.8 billion in revenue. Turner revenue was up 5% from the year-earlier period. Its operating income was $929 million, an increase of 14% over the year-earlier period.
Since late September, TNT's prime-time audience is down 6% while CNN experienced a 25% drop, according to ratings agency Nielsen.
To be sure, CNN's ratings in fall 2012 were boosted by interest in the presidential election, providing a lopsided comparison. The news network posted a strong second quarter of 2014, outpacing rival
TNT also has delivered stronger numbers this summer, producing six of the top 10 scripted shows in prime time on cable, led by "Rizzoli & Isles" and
Tuesday's announcement at Turner affects about 7% of its 9,000 workers in the U.S. On-air talent at the networks, and workers who have employment agreements, are not being offered the buyouts.
Turner Broadcasting also includes