BCE Inc. (TSX: BCE), whom is more commonly known as Bell Canada, has announced its decision to eliminate 1,300 positions and shut down six radio stations, while also planning to sell three others.
The impact of these layoffs will primarily be felt in the management ranks and is part of a broader trend of job cuts within the media industry. This sector has been grappling with the dwindling advertising revenue, rising inflation levels, and the ongoing shift from cable TV to streaming services.
The job cuts primarily affect Bell Media, a division of BCE Inc.’s Bell Canada, and will have repercussions on various platforms such as the CTV television network, specialty TV channels, radio stations, and production studios.
In an internal memo seen by Reuters, senior executive Wade Oosterman acknowledged the significant disruption the industry is facing. He also attributed part of the problem to a challenging regulatory environment that has been slow to adapt.
Bell Canada expects a yearly decline of $250 million in revenue from its legacy phone business, while the news division has been posting annual operating losses of $40 million.
In its 2022 financials, Bell Media contributed $3.25 billion to the annual revenue, or 13.5% of the total topline figure across BCE. The division also recorded the lowest adjusted EBITDA margin at 22.9% compared to Bell Wireless and Bell Wireline which both posted margins within 43%.
Radio station employees at Funny 1290 in Winnipeg, Funny 1060 in Calgary, TSN 1260 Radio in Edmonton, BNN Bloomberg Radio 1410 and Funny 1040 in Vancouver, as well as NewsTalk 1290 in London, received the devastating news of their workplaces being shut down. Additionally, Bell Media plans to sell three radio stations, AM Radio 1150 and AM 820 in Hamilton, and AM 580 in Windsor, pending Canadian Radio and Television Commission (CRTC) approval.
As part of its restructuring efforts, Bell will be closing the CTV television network’s bureaus in London and Los Angeles, as well as downsizing its Washington outpost.
“I think it is a shame,” Canadian Finance Minister Chrystia Freeland said. “CTV has some really experienced, hardworking, talented journalists who Canadians have come to rely on, and so that’s a real loss for Canada and Canadians.”
The Canadian telecom industry, under pressure from the government, has been urged to reduce bills in a highly concentrated market. Proposed legislation meanwhile aimed at compelling internet giants like Google and Facebook to pay news publishers for content has faced obstacles. Some U.S. companies have even conducted tests to limit users’ access to news content as a potential response.
Unifor, Canada’s largest private sector union, expressed deep concern and outrage over this development, attributing it to the company’s impatience with the delayed passage of Bill C-11.
“These layoffs cut deep, especially in smaller communities that rely on local news, and undermines democracy,” said Unifor National President Lana Payne. “Bell had other choices, in anticipation of policy changes, but chose to pull the trigger on these layoffs. If the government doesn’t act now, there will be little left of Canadian journalism to save.”
Unifor has been informed that around 26 unionized positions in the Greater Toronto Area will be affected, although they anticipate the actual number of impacted union jobs to be closer to 100. The reductions within Bell Media predominantly affect management, production, editorial and operations roles, as well as sales and marketing, and administrative and clerical positions.
Bell cited unfavorable public policy and regulatory conditions as the driving force behind these job cuts, stating that they can no longer wait for the situation to improve. Bill C-11, which became law in April after passing through the Senate, seeks to modernize the Broadcasting Act to regulate foreign internet streamers like Netflix and Amazon Prime Video in Canada. Canadian broadcasters have long been burdened with the responsibility of promoting Canadian content and supporting local news while facing unfair competition from foreign broadcasters.
Unifor has urged the government to amend Bill C-11 to ensure that the Broadcasting Act mandates the CRTC to support local news. This includes provisions for the development, financing, production, and promotion of local news and information programming, along with the establishment of a $120 million news relief fund dedicated to local news.
Bell has stated that affected employees will be notified this week and emphasized that the elimination of vacant positions was done to minimize the impact on existing teams.
Unifor represents over 10,000 media workers, including 5,000 members in the broadcast and film industries.
Information for this briefing was found via Reuters and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.