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Warner Cuts More Than 5% of Studio Staff

Times Staff Writer

Under pressure to slash costs, Warner Bros. Entertainment confirmed late Tuesday that it had fired 250 to 300 employees at its Burbank studio.

At least 100 additional people will lose their jobs in the studio’s international operations, according to a senior company executive who spoke on condition of anonymity.

Warner’s cuts are among the deepest by a studio this year and come as Hollywood is being forced to deal with spiraling costs while the once-hot DVD market cools off and TV syndication dries up.

Warner spokeswoman Sue Fleishman, who confirmed the layoffs on the Burbank lot, did not provide a breakdown of the cuts except to say that they affected all divisions, including Warner Bros. Pictures and its specialty film unit, Warner Independent Pictures. The company’s television, home video, consumer products and corporate operations also were hit.

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“We had to take some difficult measures to position the company for the future,” Fleishman said. “We acknowledge that these decisions have affected people’s livelihoods and to that end we examined every aspect of our business in order to cut costs responsibly and to keep staff reductions to a minimum.”

The company, owned by Time Warner Inc., employs 8,000 worldwide. The layoffs in Burbank amount to at least 5% of the 4,500 Warner employees there.

Warner has been reviewing staffing and expenditures with an eye toward shoring up profit. The top-to-bottom evaluation encompasses all of its businesses, scrutinizing not just personnel but also travel and entertainment expenses, development and marketing costs.

Warner Bros. Entertainment Chairman Barry Meyer and President Alan Horn declined to comment Tuesday.

Last month, however, Meyer released a statement acknowledging that changing consumer demands, the maturation of some of the company’s businesses and rising costs were presenting challenges to the studio.

“As part of our normal budgeting process, we continually review our businesses to find ways to operate more efficiently and effectively in light of the constantly changing marketplace,” he said then.

Warner’s actions come as the company is enjoying a stellar year in film, home video and TV, with such hit shows as “Without a Trace,” “Two and a Half Men” and “ER.” And on the success of “Charlie and the Chocolate Factory” and “Batman Begins,” among other movies, Warner already has raked in more than $1 billion at the box office.

But Time Warner is under attack by dissident shareholder Carl Icahn, who has railed against the company’s “bloated cost structure.” He has vowed to hire an industry consultant to uncover any “excess fat.”

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Warner isn’t the only Time Warner unit to slash jobs. Its America Online division, which continues to lose dial-up customers, is laying off more than 700 employees.

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Times staff writer Kim Christensen contributed to this report.


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