Channel 4 could cut as many 200 jobs as it seeks to make savings amidst the worst TV advertising downturn since the 2008 financial crisis.
When the TV advertising market slumped during that downturn, Channel 4 sought to balance its books by cutting 200 jobs, almost a quarter of its then 875 permanent employees. The broadcaster has since undergone a rapid expansion – staff numbers stood at 1,197 in its 2022 annual report and are understood to have risen since, with staff numbers now at record levels of more than 1,200 across bases in Leeds, Manchester Glasgow and Bristol as well as its London HQ.
The broadcaster said in a statement: “Like every organisation, we are having to deal with an extremely uncertain economy in the short term and the need to accelerate our transformation to become a wholly digital public service broadcaster in the long term. As a result, we need to continue to divest from our linear channels business and simplify our operations to become a leaner organisation.”
An internal memo sent to staff by CEO Alex Mahon this morning reiterated Channel 4’s intentions of “re-engineering the linear business to embrace the generational shift in TV viewing.”
Channel 4 has been particularly hard-hit by the current downturn in traditional TV advertising as it accounted for two-thirds of its £1.14bn in total revenues in 2022, the last year for which full results have been published.
Streaming ad revenues are growing at a healthy 14%m, to £255m in digital ad revenues for the same period, but so far that has not made up for the loss of linear revenues.
Channel 4 has also been at a unique historical financial disadvantage compared to other PSBs as, until recently, it has not been allowed to produce its own in-house content under the terms of its publicly owned/self-funding model, limiting its capacity to reap the rewards of successful shows.
These rules were relaxed under last year’s media bill and the channel is currently looking into bringing some production in-house, although Mahon told the Commons Culture, Media and Sport Committee in November she expected the process to be “super slow.”
At the same session, the C4 CEO told the committee that the channel may also look into drawing on its £75m revolving credit facility for the first time since the beginning of Covid as it sought to deal with what she described as “market shock territory.”
The broadcaster has already taken a sledgehammer to its £700m+ programming budget, with shows including Steph’s Packed Lunch, SAS: Who Dares Wins, Four Weddings, Scared of the Dark, Five Dates a Week and Rescue: Extreme Medics all falling by the wayside an an attempt to cut costs.
The bulk of cuts are expected to be felt at C4’s London offices as the broadcaster remains committed to fulfilling its goal of having over 600 roles based in its nations and regions offices by 2025 – numbers currently sit at just over 500.
