NETWORKS TIGHTEN BELTS AGAIN : CBS-TV CUTS COSTS, ELIMINATES 700 JOBS

CBS confirmed Wednesday that it will cut 700 jobs in a major round of cost cutting, with about 525 employees to be laid off.

Most of the layoffs will be completed by the end of the month, according to Gene Jankowski, president of the CBS Broadcast Group. The other reductions will come through attrition.

“The broadcast industry must respond to an economic environment of long-term disinflation and stable but slow growth. In order to maintain our strength and ensure future success we must continue our efforts to reduce cost and enhance productivity,” Jankowski said.

He said cost savings will come through organizational streamlining that consolidates and reassigns certain functions and institutes new operating procedures in some areas.

“The quality and competitive nature of our on-air product will in no way be diminished by these actions,” Jankowski said.

“We wish layoffs could have been avoided,” he said in a memo to employees. “We will rely on attrition for any further staff reductions which may be required.”

All divisions of the broadcast group will be affected on a relatively equal basis in terms of percentage of job reductions, he said.

In a separate memo to staffers, Van Gordon Sauter, president of CBS News, said the news division would lose 90 jobs, 70 coming from layoffs. A small number of layoffs will include on-air reporters, Sauter said. The list of news layoffs hasn’t been completed, Sauter said. No names were released.

In addition, “Nightwatch,” CBS’ money-losing, late-night news program, was not canceled--but it will become an altered broadcast, Sauter said.

The cuts amount to about 8% of the Broadcast Group’s 8,000 employees.

With advertisers saying they won’t bail out television’s runaway expenses anymore, all network TV is facing cutbacks, layoffs and perhaps next year the end of such money-losing propositions as ABC’s “Monday Night Football.”

The networks are grappling with a new TV economy that is burdened by a national economy that isn’t as inflationary as in past years, prompting the nation’s major consumer industries to cut their advertising budgets and balk at the networks’ annual double-digit ad rate hikes.

John Sisk, senior vice president of the J. Walter Thompson advertising agency, said Tuesday that network TV has stopped gaining audiences annually.

“We’ve hit the absolute level in cost in relation to audience delivered,” Sisk said. “You can drive the car only so fast until it starts to shake.”

Jankowski saw the handwriting on the wall and informed CBS employees in a letter last May. He explained that he was initiating a companywide review of ways to cut costs and raise productivity.

“Our strategies are straightforward and, sadly, in some cases painful,” Jankowski wrote.

In June, he told TV reporters at a news conference: “American companies have to orient themselves to the fact that they can no longer sell themselves out of cost situations.”

Last year, profits for the CBS Broadcast Group, which controls news, sports, entertainment, radio and the four network-owned TV stations, were $360.6 million, a decline from the record profits of $408.6 million recorded in 1984.

CBS’ cutbacks will occur in conjunction with other moves to streamline CBS’ broadcast operations. One such example that saved money and streamlined the executive structure was last week’s reorganization in CBS Sports.

Where there had been four autonomous executive producers, CBS chose Ted Shaker to be sole executive producer, prompting the resignation of two others, Terry O’Neil and Kevin O’Malley.

The CBS cuts are reflective of the cost-cutting consciousness of CBS’ network rivals as well.

When Capital Cities assumed control of ABC earlier this year, it engineered widespread job cuts, including 74 at ABC News.

Dennis Swanson, who was hired by Cap Cities as president of ABC Sports to get costs under control, said last month that ABC might not renew “Monday Night Football” after its five-year contract runs out this season, despite healthy ratings last year.

“You’re in a dilemma,” Swanson said. “You have a tremendously successful product, but it costs you more to put it on the air than you can generate from the advertising of it.”

ABC Entertainment President Brandon Stoddard also said last month that the network is beginning to develop contingency programming for Monday nights.

Even top-rated NBC is not immune to network television’s weakening financial position. In May, NBC Chairman Grant Tinker asked for a companywide analysis of each department’s practices, personnel and costs. Department heads had to submit their reviews to Bob Walsh, an NBC executive vice president, by the end of June.

“It will be at NBC and it is at Cap Cities. That’s the way the industry is going,” said Richard J. MacDonald, vice president for the investment firm, First Boston Corp.

Despite CBS’ cuts, network executives still plan to revamp the “CBS Morning News” this fall, as previously reported. According to news division sources, one plan being given strong consideration is for regionalized anchors from cities other than New York, where all three network morning news shows now emanate.

Cities being considered include New York, Chicago and Los Angeles.

Current co-anchor Forrest Sawyer is seeking another position within CBS News, as reported Wednesday. The other co-anchor, Maria Shriver, has been asked to be a host from Los Angeles, but hasn’t made a decision yet.

Sources also said two leading candidates for anchor positions include Charles Osgood, CBS’ most popular radio correspondent and anchor of CBS’ “Sunday Night News,” and Linda Ellerbee, the NBC correspondent who left the network following the expiration of her contract last week.