The major studios are taking a hard look at their television budgets as the economic downturn that has shaken the broadcast networks since the Sept. 11 attacks continues to take its toll.
The television industry has been deeply affected by the tremendous loss of advertising revenue due to both the 24-hour news coverage and the postponement of the fall premiere lineup. Sony, 20th Century Fox, AOL Time Warner and the Walt Disney Co. are among the top studios who have been forced to cut back on production budgets.
Fox, one of the industry’s top suppliers of primetime fare, with at least two dozen series set to air this season across six broadcast networks, has asked producers to cut 2 percent of their production budgets, as reported by The Hollywood Reporter. Peter Chernin, News Corp. president and chief operating officer, estimated Fox’s television affiliates took a $100 million hit in the days after the Sept. 11 attacks.
“This is an extraordinary time, and like everyone else in the industry, we need to take appropriate measures that ensure our company’s long-term viability and protect our valuable assets,” Dana Walden, president of 20th Century Fox Television told The Reporter.
AOL Time Warner and Walt Disney Co., who had already begun their cost-cutting process before the attacks, have had to cut their bottom line even more. Sony Pictures Entertainment, as well, is getting pressure from their top brass in Tokyo to evaluate their budgetary priorities.
The budget concerns come from the fact that the major television networks are cutting spending on current shows and projects in development for next year. Networks that once chipped in for guest stars and location shoots for episodic series are now leaving those costs entirely to the studios. The networks are also making fewer big commitments to projects in development.
The continuing threat of terrorist activities, including the current anthrax scare at NBC and other media companies, isn’t helping the situation.
CBS president and CEO Leslie Moonves, whose network has seriously been affected by the twice cancellation of the Primetime Emmy Awards, told The Reporter, “There’s a general malaise out there…Right now people are having trouble planning marketing campaigns, and that is what’s causing a slowdown in the [advertising] marketplace and adding to the feeling of uncertainty across the business.”
