Bell cuts 1,300 positions, radio stations and foreign bureaus in restructuring
Posted Jun 14, 2023 06:01:22 PM.
TORONTO — BCE Inc. is cutting 1,300 positions, shutting or selling nine radio stations and closing two foreign bureaus as the company plans to “significantly adapt” how it delivers the news in the face of rising financial pressure.
The plan entails “moving to a single newsroom approach across brands, allowing for greater collaboration and efficiency,” said Richard Gray, vice-president of news at Bell Media, in an internal memo distributed to staff Wednesday morning and provided to The Canadian Press.
The company’s media branch “can’t afford” to continue operating with its various brands — such as CTV National News, BNN, CP24, its local TV news stations and radio channels — independently of one another, said Bell chief legal and regulatory officer Robert Malcolmson in an interview.
“It’s a consolidation of news gathering, news delivery,” he said.
The layoffs include a six per cent cut at Bell Media, but Malcolmson said cuts, amounting to around three per cent of its total workforce, are happening across the organization.
“This thing affects all layers of the company and isn’t targeted at any one band of employees.”
Management positions at BCE are also being slashed by six per cent, while there will also be 20 per cent fewer executive roles in the company compared with 2020.
About 30 per cent of the positions being eliminated are current vacancies that won’t be filled.
CTV’s foreign bureaus in London, U.K, and Los Angeles are set to close while its Washington, D.C. presence will be scaled back.
Bell Media said it would also shut down Edmonton’s TSN 1260 Radio, Vancouver’s BNN Bloomberg Radio 1410 and Funny 1040, Winnipeg’s Funny 1290, Calgary’s Funny 1060, along with London’s NewsTalk 1290. It is also selling Hamilton’s AM Radio 1150 and AM 820, as well as Windsor’s AM 580, to an undisclosed third party, subject to CRTC approval.
In a separate internal memo sent on Wednesday, Bell Media president Wade Oosterman said the company is coping with “the ongoing migration of advertising revenue to foreign digital platforms” such as Facebook and Google, and a shift from cable, satellite and Fibre TV subscribers to digital streaming platforms.
“We are also faced with strong economic and inflationary pressures, a pullback in advertisers’ budgets, and a challenging regulatory environment that has been too slow to adjust,” said Oosterman in his memo to staff.
In an open letter published online Wednesday, Bell Canada president and CEO Mirko Bibic said Bell Canada expects to lose more than $250 million in legacy phone revenues per year, while its news operations incur $40 million in annual operating losses. He said Bell radio stations have seen profit cut in half since the start of the COVID-19 pandemic.
“The job reductions are consistent with, but smaller than, similar reductions announced by other leading technology and media companies across North America in recent months,” said Bibic.
Dwayne Winseck, a professor at Carleton University’s School of Journalism and Communication, said the move to a more centralized newsroom would hurt local journalism, particularly on radio airwaves.
“One of the key things that I think has helped radio is its claim to local representativeness and so this really takes a knife to that,” he said.
Gregory Taylor, an associate professor with University of Calgary’s communications, media and film department, said Bell’s announcement is the culmination of “the last 10 years really coming home to roost.”
“We’ve been told now for more than a decade that Canadian companies have to get larger to compete on a global scale. This was always questionable,” he said.
“And now we’re seeing the danger element of it is that when there are problems with some of these companies, at various levels, it has impacts across the country.”
Taylor said those affects would be felt locally, where the range of voices offered to Canadians would be limited.
“There’s so much that’s going to be potentially lost here,” he said.
Malcolmson said regulatory challenges affecting both the telecommunications side and media arm left the company in an “unenviable place,” with no choice but to make widespread cuts.
“We’re obviously trying to do this in the most humane, least impactful way possible,” he said.
Malcolmson did not rule out further layoffs in the foreseeable future, saying the company will take a wait-and-see approach to the regulatory environment.
He took aim at “relentless regulatory intervention” by the CRTC, under Ottawa’s direction, that has prioritized measures to bring down the cost of telecommunication services.
Noting that the cost of wireless service has declined around 25 per cent and the cost of broadband high-speed internet has gone up by less than one per cent over the last three years, despite Canada’s overall high inflation, Malcolmson said “maybe it’s time to declare victory” for Ottawa.
“I think the government’s sort of populist focus on pricing isn’t necessarily in line with current reality and the government has created an intensely competitive industry structure that they should allow to play out,” he said.
Telecommunications consultant Mark Goldberg said it’s fair to criticize Ottawa for a narrow focus on price reduction at a time when much investment is still needed by Canada’s major providers to meet consumers’ needs.
“With this regulatory uncertainty, it’s a difficult market to invest in.”
But Winseck called it a situation that Bell could have avoided with better decision-making over the past decade.
“It seems to me that Bell is asking for the stars and the moon,” he said. “It has a pretty favourable regulatory framework already.”
A Reuters Institute report released Wednesday showed CTV News had the widest offline reach of English media outlets in Canada, and the second most online reach.
Still, Winseck said Bell has not invested enough “to allow itself to stand out as a major news provider.”
The company has also failed to invest in its own domestic catalogue to compete on the streaming side, said Winseck.
“Without your own domestic catalogue, the days were numbered. It has basically withheld or starved its radio stations and its TV services of the investments that it would need to develop a robust catalogue of its own television and film programming.”
Malcolmson lamented the process around two pieces of legislation designed to help Canada’s struggling media sector. While Bill C-18 would require companies like Google and Meta to pay Canadian outlets for news content that appears on their platforms, he said it could be for naught if the companies follow through on threats to restrict or block news links on their sites in response.
The other, Bill C-11, aims to force platforms such as Netflix, YouTube and TikTok to contribute a percentage of their Canadian revenue to Canadian production, but Malcolmson said it’s not going to solve the “fundamental problem” that popular American content is being “withheld” by major streaming platforms from appearing on Canadian TV.
In a tweet, Heritage Minister Pablo Rodriguez said the “sad news” about Bell’s layoffs served as “yet another example of why bills C-11 and C-18 are necessary.”
“A broke press is not a free press, and big tech needs to pay their fair share,” the minister said.
The union representing some of the media workers being laid off said Bell should have let the two bills to finish working their way through the legislative process before deciding whether to make cuts.
“We think we think they should have waited and it’s a shame that they didn’t,” said Randy Kitt, a spokesman for Unifor, which represents around 80 of the staff affected.
Kitt said it was a “devastating” day for members.
“We’re surprised and we’re not surprised,” he said. “The media landscape in this country is extremely tough right now, which is why the government enacted two pieces of legislation to address it. We thought that Bell Media could have had other options to hold off until they saw relief from either C-18 or C-11.”
Malcolmson said Bell has been waiting for regulatory reform for years and the company decided not to hold back cuts pending the outcome of regulatory consultations on those bills any further.
“We have to ensure that our business is able to operate in a viable way, and we can’t wait two years and another, for example, $80 million of losses in news to see what the government might do.
“At some point, we have to say to ourselves, ‘Is it worth funding this?'”
This report by The Canadian Press was first published June 14, 2023.
Companies in this story: (TSX:BCE)
Sammy Hudes, The Canadian Press