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As Disney continues to merge the 21st Century Fox organization into its existing structure, it's being reported that another round of significant layoffs are taking place. This time, layoffs are hitting both sides of the fence, with people within both the previous Fox company as well as Walt Disney Studios employees being cut. While no official statement has been made by Disney, the divisions that handle marketing, publicity, and domestic film distribution are expected to be the ones facing the biggest cuts.
It's too surprising to see cuts to these particular divisions happening now. It was just about 10 days ago that Walt Disney Studios released an updated release calendar, the first to include Fox projects. Making this decision was a major priority for the new company, and now that it was made, Disney knows exactly what its needs in the realm of distribution and marketing will be, and with that information, it knows how many employees will actually be needed. Clearly not as many as it has.
The Fox studio used to release a dozen or more movies in a year when it was a separate company, but is set to release only nine in 2020. Disney CEO Bob Iger says that he expects Fox will produce something life five to six films a year once things get settled. Clearly, with a reduction like that, there are going to be fewer employees needed to do the work of distribution and marketing those films.
We saw a first significant round of layoffs on March 21. The acquisition of Fox had been made official earlier that month. Those cuts reportedly were exclusive to the Fox side of the business, so this appears to be the first round of layoffs to have a significant impact on existing Disney cast members.
While the Disney/Fox merger may have some exciting possibilities when it comes to content, there are downsides from every other perspective. Having one fewer major studio will simply reduce the number of movies being made, which means fewer voices getting a chance to have their stories heard. It also means fewer people working in general, as these layoffs show.
The purchase of Fox in the first place was designed to make Disney more competitive in a modern media marketplace. Disney is launching the Disney+ streaming service in November and the Fox owned content like National Geographic adds to the depth of material the service will be able to provide.
At the same time, Disney has to keep its costs down as much as possible in order to remain as profitable as possible. Disney has already said that Disney+ will actually be a money loser in the short term of the next couple of years. Those loses will need to be offset by gains elsewhere, and that means keeping costs down at the movie studio.
Variety reports that the total number of layoffs could reach as many as 4,000 people before it's all over. We don't even know how many have been given the pink slip yet, so that means we also don't know how many more times this is going to happen.