Layoffs Coming

[DizneyFreak2002]

Gotta pay for this $2 billion mess of NextGen some how.. From Reuters:

Exclusive: Disney looks for cost savings, ponders layoffs - sources

(Reuters) - Walt Disney Co (DIS.N), which reported record earnings in November, started an internal cost cutting review several weeks ago that may include layoffs at its studio and other units, three people with knowledge of the effort told Reuters.
Disney, whose empire spans TV, film, merchandise and theme parks, is exploring cutbacks in jobs no longer needed because of improvements in technology, one of the people said.


It is also looking at redundant operations that could be eliminated after a string of major acquisitions over the past few years, said the person, who did not want to be identified because Disney has not disclosed the internal review.


Executives warned in November that the rising cost of sports rights and moribund home video sales will dampen growth.
"We are constantly looking at eliminating redundancies and creating greater efficiencies, especially with the rapid rise in new technology," said Disney spokeswoman Zenia Mucha.


In terms of profit margin, Disney's studio is the least profitable of the entertainment conglomerate's four major product divisions.
Its fifth division, the interactive unit that creates online games, lost $758 million over the last three years, according to the company's financial filings.


Disney could trim jobs at both the studio and interactive divisions as well as its music arm, said Tony Wible, an analyst with Janney Montgomery Scott, who has a neutral rating on the company's stock.


The media company is in what CEO Bob Iger calls a "transition year" after spending on projects such as the "Cars Land" expansion at the Disneyland Resort in California and a new cruise ship that launched last year.
"We invested a lot of money in our theme parks and resorts business," Disney chief financial officer Jay Rasulo told a media conference in December. "We want to execute against delivering the returns that we've been promising all of you for the years that we've been making those investments. We really want to hunker down on it."
Staff cuts are not a certainty at this point, the person added, although the company has a history of streamlining operations through layoffs.


In 2011, the interactive group laid off about 200 people at its video games unit after what Disney executives said at the time was a shift away from console games to focus on online and mobile entertainment. In September, 50 employees at Disney Interactive were laid off in a restructuring of the money-losing unit, according to one of the sources.


The company also made cuts at its publishing unit last year, and cut workers at its studio in 2011.


"This is not necessarily a negative thing," said Michael Morris, an analyst with Davenport and Company who has a buy recommendation on the stock but was not aware of the review.


"It speaks to a fiscally responsible management."


STUDIO COULD BE TARGET
Walt Disney increased its earnings by 18 percent to $5.7 billion in its 2012 fiscal year that ended September 29, on $42.3 billion in revenues.


The present review, headed by CFO Rasulo, has already identified areas to change in the company's travel policy, said one of the people. It is also looking at a hiring freeze rather than layoffs, said a second source.
Cuts are most likely at the studio, said two of the three people, where the strategy has changed to focus on fewer films and rely more on outside producers such as Steven Spielberg's Dreamworks studio, which finances its own films and pays Disney a fee to market and distribute them.


The film strategy shift began when Iger took over as CEO in late 2005. Under Iger, the company purchased "Toy Story" creator Pixar Animation and Marvel, which brought it characters such as "Thor" and "Iron Man" that featured in this summer's blockbuster hit "The Avengers."


Disney completed a $4.06 billion acquisition of "Star Wars" creator George Lucas' Lucasfilm in December, and has said that it will begin producing new installments of the lucrative franchise in 2015, and make a film every two to three years.


The studio's 12.3 percent profit margin in 2012 was the lowest of Disney's four major operating units. The interactive unit lost

$216 million last year.


Shares in the company gained 1.9 percent to close Friday at $52.19.


(Editing by Edwin Chan and Richard Pullin)

Bob Iger, here is a recommendation, free of charge: get rid of the dead weight known as TDO...

[TinkerbellT421]

One thing that bothers me about technology is the loss of jobs. Why pay people to do it when computers can do it for free mentality bothers me. Not to get off topic, I refuse to use the self checkout computers at the stores for that very reason.

[DizneyFreak2002]

One thing that bothers me about technology is the loss of jobs. Why pay people to do it when computers can do it for free mentality bothers me. Not to get off topic, I refuse to use the self checkout computers at the stores for that very reason.

I've always said be careful what you wish for... My last job, they implemented a program where the system would automatically approve customer payment requests without having to be reviewed by human eyes... Everyone applauded it thinking it was great cause it would cut down on the workload... Well, many layoffs later, I wonder if they still feel that way...

Technology is a great thing... I love it... But, it comes with a cost, and that cost is usually your job...

[DisneyGlutton]

Gotta pay for this $2 billion mess of NextGen some how..

I'm not up to speed on future plans, so could you please explain what NextGen is? Is it that stupid new wrist band and FastPass+? If so, how in the world would it cost so much???

[DizneyFreak2002]

I'm not up to speed on future plans, so could you please explain what NextGen is? Is it that stupid new wrist band and FastPass+? If so, how in the world would it cost so much???

That is all part of NextGen, right down to the interactive queues...

The original dollar amount Tom Staggs quoted this would cost was $1 billion dollars... It has now hit $1.5 billion and climbing to and probably going to blow past $2 billion... One thing Disney is not good at is spending money properly and efficiently... LoL...

[DisneyGlutton]

One thing Disney is not good at is spending money properly and efficiently... LoL...

Perhaps Mr. Staggs should instead use some of that money to maintain the attractions that are already there?

[DizneyFreak2002]

Perhaps Mr. Staggs should instead use some of that money to maintain the attractions that are already there?

Honestly, I don't think he has much power over that. I mean, I guess he could look around the park, see things a mess and demand to know why, then demand they do something about it... But, whenever he is in town, they know before hand... They make sure everything is working perfectly, or at least is show ready... The real culprits are the park presidents...

[Tekneek]

Disney is seen as managing things well at a macro level, which is all these market analysts know about, while there isn't much doubt that at the micro level the company looks more like they're bankrupt while banking billions (particularly in the parks).

Sure, they have shiny new expansions, but they've got rust, peeling paint, burned out bulbs, safety netting keeping the walls up, a huge animatronic that has been mothballed, etc, in the rest of the mouse house. A nice shell game.

[BrerGnat]

Did any of you actually read this article?

The layoffs seem to be most likely at the STUDIO and INTERACTIVE divisions of the company...both areas that experienced significant financial losses recently. It makes total sense.

These layoffs have nothing to do with the theme parks. The mention of CarsLand means nothing to the overall story. It was thrown in there so that it can be made to be "the reason" for the layoffs.

[Tekneek]

The Studio is profitable. Interactive division is a money loser, though. My comments were directed mainly at the analyst who was talking about the company being fiscally responsible.

[BrerGnat]

The Studio is profitable. Interactive division is a money loser, though. My comments were directed mainly at the analyst who was talking about the company being fiscally responsible.

The studio's 12.3 percent profit margin in 2012 was the lowest of Disney's four major operating units. The interactive unit lost

$216 million last year.

A 12.3% profit is a loss over previous years.

The studio is bleeding, along with the Interactive unit. Changes/cuts need to be made to avoid even lower profits, or loses next year.

[TinkerbellT421]

Did any of you actually read this article?

The layoffs seem to be most likely at the STUDIO and INTERACTIVE divisions of the company...both areas that experienced significant financial losses recently. It makes total sense.

These layoffs have nothing to do with the theme parks. The mention of CarsLand means nothing to the overall story. It was thrown in there so that it can be made to be "the reason" for the layoffs.

Second sentence of the article

Disney, whose empire spans TV, film, merchandise and theme parks, is exploring cutbacks in jobs no longer needed because of improvements in technology, one of the people said.

Was what I was talking about when I went on my rant about upgraded technology and the loss of jobs. And there is no doubt in my mind that these lay offs also have a lot to do with the money spent on NextGen.

[Tekneek]

A 12.3% profit is a loss over previous years.

The profit may be lower, but it is not a loss. It might be better characterized as negative growth, but not as a loss.

[DizneyFreak2002]

Did any of you actually read this article?

Question: did you?

[DizneyFreak2002]

Second sentence of the article


Was what I was talking about when I went on my rant about upgraded technology and the loss of jobs. And there is no doubt in my mind that these lay offs also have a lot to do with the money spent on NextGen.

These lay offs do have a lot to do with the NextGen money, which is why you WILL see lay offs in WDW... How many CMs will lose their jobs are unknown... Sure, while most of the job loses will be redundant jobs and dead weight at the Studio (is that everyone there????), the theme parks are NOT immune...

Like I said, technology is a wonderful thing, but just like magic, it comes with a price...

[Dulcee]

These lay offs do have a lot to do with the NextGen money, which is why you WILL see lay offs in WDW... How many CMs will lose their jobs are unknown... Sure, while most of the job loses will be redundant jobs and dead weight at the Studio (is that everyone there????), the theme parks are NOT immune...

Like I said, technology is a wonderful thing, but just like magic, it comes with a price...

Like I said in the other thread regarding next gen this isn't solely seen in Disney. The reality is Disney has to keep up with current technology. No one claims to be happy about the loss of manufacturing and unskilled jobs in this country but they are very (vocally) unhappy when you tell them more employees equals a higher cost for their favorite product.

Disney and WDW are a business. The decisions they're making do make sense from a business stand point. Is it sad that people lose their jobs? Yes. Does the average guest want a quicker, streamlined more technologically advanced process in whatever aspects possible? Yes.

Can you have both at once? Probably not, at least not in the sense of keeping your unskilled teenager or retiree employee.

[BrerGnat]

Question: did you?

I absolutely did. I read it carefully. Seems like a couple people just skimmed the title and jumped to "there are going to be layoffs at WDW." It says that NOWHERE in this article. In fact, it says quite clearly that the layoffs will most likely be in the Studios division, along with changes in policies such as travel, in order to reduce costs and eliminate unnecessary expenditures.

[DizneyFreak2002]

I absolutely did. I read it carefully. Seems like a couple people just skimmed the title and jumped to "there are going to be layoffs at WDW." It says that NOWHERE in this article. In fact, it says quite clearly that the layoffs will most likely be in the Studios division, along with changes in policies such as travel, in order to reduce costs and eliminate unnecessary expenditures.

Then let me ask you this, did you read the responses? Cause no one here said anything about WDW layoffs... No one made that leap until I made the comment today... So, how did you make the leap from Tink discussing technology leading to job loss and Josh asking about the NextGen project and the power Staggs has to get TDO to perform to us discussing WDW lay offs? Casue not one person here, until my post at 11:50 AM this morning, ever brought up WDW lay offs, which, yes, will be occurring...

[kbean]

Well I hear..... that they will start using cardboard cut outs at meet n greets instead of live characters.

[Buttercup]

Then let me ask you this, did you read the responses? Cause no one here said anything about WDW layoffs... No one made that leap until I made the comment today... So, how did you make the leap from Tink discussing technology leading to job loss and Josh asking about the NextGen project and the power Staggs has to get TDO to perform to us discussing WDW lay offs? Casue not one person here, until my post at 11:50 AM this morning, ever brought up WDW lay offs, which, yes, will be occurring...

Seriously, DizneyFreak, calm down. Holy moly.
Mods, I'm sorry... but I just had to say that.