It’s Crunch Time for ABC’s Jennings

Speculation intensified in the television news business over whether ABC News flagship anchor Peter Jennings is being asked to take a pay cut along with others in the newsroom, prompting both the anchor and ABC News management to issue statements.

Jennings’ contract expires this summer, and top management at ABC News has said the network wants to keep the newsman, who is estimated to make between $7 million and $10 million annually for anchoring “World News Tonight”--on a par with NBC’s Tom Brokaw and Dan Rather at CBS.

Still, ABC’s news division, with an annual budget of about $500 million, has been under strict cost restrictions in the last year, eliminating 125 positions, letting some high-profile correspondents such as Sheila MacVicar and Morton Dean leave, and asking many senior employees to take pay cuts of as much as 25%.

The financial crunch has been compounded by higher news-gathering costs for covering the war in Afghanistan and the turmoil in the Middle East. Moreover, across the industry, executives have been increasingly focused on the fate of their morning news broadcasts--which have been growing in viewers and profits--while evening newscasts have been on a long downward trend that has stabilized only this year.

Several people in the small circle of news talent agents and lawyers have been saying for weeks that Jennings, 63, would be asked to take a cut. The speculation went public this week with Internet and published reports concerning the matter, which quoted anonymous sources.

Still, many in the industry have been skeptical that ABC management would ask Jennings to reduce his salary, given the signal that would send coming on the heels of the revelation that ABC was willing to get rid of “Nightline” if it could steal comedian David Letterman away from CBS.

Letterman decided to stay at CBS, and ABC management and “Nightline” recently made peace, with the issuance of mutually supportive statements, but not before bitter words had been exchanged.

Those involved in the negotiations limited themselves to short statements that steered clear of the pay cut issue. In his, Jennings said, “In more than 30 years, I’ve never commented on any contract negotiations, nor have I negotiated publicly. I see no reason at this time to change.”

ABC News President David Westin, meanwhile, said, “We have every hope and expectation that Peter will be our principal anchor for many years to come. We will not discuss Peter’s or anyone else’s contract in the press in any way.”

Just in case, though, ABC executives have talked internally about “Good Morning America” co-anchor Charlie Gibson as a possible replacement for Jennings, people familiar with the situation said. Gibson’s contract also is due to expire soon.