QED International has laid off five employees (which includes support staff and a junior lawyer) three weeks after the disastrous opening of Sabotage, directed by David Ayer and led by aging action star Arnold Schwarzenegger. The bloody pic flopped and is hanging on by its fingernails in the Box office Top 20 — it’s No. 18 in its third weekend — having grossed a mere $10M. John Hegeman, president of worldwide marketing, is still on board as he helps prepare the debut of the next Ayer-directed film, Fury, which has some star power in Brad Pitt, Shia LaBeouf and audience favorite Michael Pena. QED slapped down $1M to buy the WWII spec from Ayer over a year ago; it will bow in November. One insider said that QED is reallocating resources for development spending. To that point, today QED purchased Yellowstone Falls, a 52-page spec script by Dan Kunka, winning what was said to be a heated bidding war. The film, which will be produced by Kevin Misher and QED President Bill Block, is about a mother wolf who must battle to save her cubs after being separated from her mate following an apocalyptic event. The film will have nearly no dialogue and few actors. Sounds a little like Disneynature’s Bears — with mutated humans thrown in.
The layoff picture at Sony Pictures is clearing, at least a little bit. The studio was required to file a Worker Adjustment And Retraining Nofication with the state, and it has formally declared that 216 will be the head count. That’s hardly the total picture, however, and it mostly covers the number of employees who’ll be pink slipped on the Culver City lot. Here’s the formal notification. We knew this was going to be a painful week at the studio, but we have not gotten the full head count yet.
One more person who was let go is John Cacavas, VP Worldwide Theatrical Distribution. Cacavas has worked up the weekend studio estimates for the last 20 years for distribution head Jeff Blake.
Changes continue at Sony Pictures amid the wake of the pre-Thanksgiving announcement that it plans to cut $250M in costs during the next few years as it shifts focus from movies to TV. Layoffs were announced today including Sony Pictures Technology President Chris Cookson, as his department is being absorbed into Sony Pictures Entertainment. A source familiar with the situation tells Deadline that the number of job cuts was “under 50″ and that they also affect Sony’s home entertainment unit and ani/VFX house Imageworks. “As part of the Company’s previously announced efforts to evolve its operations, Sony Pictures Entertainment (SPE) is absorbing the functions of Sony Pictures Technologies into various core businesses,” SPE spokesman Charles Sipkins said in a statement. “Regrettably, Chris Cookson will leave the Company as a result. In related moves, SPE has streamlined technology groups across its businesses to accelerate creative and technological innovation. The entire Company wishes to express its deep gratitude to Chris, his team, and the other groups involved in these changes.”
Paramount has trimmed its staff by 110, with a memo issued just now on the lot. The layoffs happened this morning, and the casualties have been informed. This was not unexpected. Viacom CEO Phillipe Dauman gave a speech at the Goldman Communicopia recently, and indicated the studio would be trimming its ranks by watching movie and TV costs.
The studio is coming off some success on the movie side, but it sure hasn’t been easy. World War Z and G.I. Joe: Retaliation both bore fruit after the studio pulled them off the 2012 schedule and fixed them. These layoffs are never fun, and it feels like it is getting tougher each year. The other part of this that sucks is often, when one studio trims staff, others seem to follow.
Here is the memo that was sent to staff.
To: Paramount Employees
From: Frederick Huntsberry
As our industry continues to adapt to an increasingly competitive environment, we are always ensuring that Paramount is conducting its business as efficiently and productively as possible. As such we are making important and necessary changes in how we operate across several business functions. Although most employees will not be impacted, these changes will result in organizational realignment in select areas, and the elimination of 110 positions on the lot and in a number of international locations. The headcount reductions will primarily impact Finance, Human Resources, Information Technology, International Home Media Distribution, Legal and Marketing.
Change is always difficult
EXCLUSIVE: Warner Bros Home Entertainment has laid off several employees working in the DVD division of the business, Deadline has learned. We’re told that the cuts involved backroom functions related to the DVD supply chain; the disc business has been steadily in decline in the industry thanks to digital delivery. The cuts were to only about one-half of 1% of the conglom’s total global workforce that numbers about 8,000, we’re told, and Warner Bros is looking to relocate about half of the affected workers elsewhere in the company. WBHE includes Warner Home Video, Warner Bros Digital Distribution, Warner Bros Advanced Digital Services, Warner Bros Interactive Entertainment, Warner Bros Technical Operations and Warner Bros Anti-Piracy Operations.
This just in: Layoffs are about to hit one of public broadcasting’s signature shows. The New York Times reports that PBS NewsHour, the nightly newscast launched in 1975, is closing its San Francisco and Denver offices — its only outlets outside the D.C. area — and pink-slipping most of the staffers there. It will be the show’s first major round of layoffs since the mid-‘90s. Producer MacNeil/Lehrer Prods also will cut some jobs at NewsHour’s Arlington, Va., headquarters and make cutbacks by not filling vacant positions and streamlining. The reason? A decrease in corporate sponsorship. A NewsHour spokeswoman told the Times that the reorganization, which will take place over several months starting in July, would help balance the budget.
The final curtain is about to fall on one of the industry’s top bond guaranty companies. International Film Guarantors has been gutted by its parent company’s decision to switch its allegiance to IFG’s main rival, Film Finances Inc.; Fireman’s Fund instead will insure that firm’s film-completion guarantees starting in early summer. That leaves IFG out in the cold, and the Santa Monica-based company that has bonded hundreds of films over more than two decades soon will be shuttered. Deadline hears that IFG will continue to take new bonding business through July 1, when the Fireman’s-Film Finances deal is expected to close, but will wind down from there. All bonds issued by IFG through that date will continue to be backed by Fireman’s Fund. We hear that there have been no immediate layoffs at IFG but that all staffers including top management will be exiting – some leaving by July and others staying into the fall to work on projects already bonded by the company.
BREAKING: This is the week when the pain from the Lionsgate and Summit Entertainment merger gets felt, as the pieces are being mixed and matched, and layoffs rule the day. It sounds a lot like the plot of Highlander, a high profile remake that comes in through Summit. They are taking heads, and when it comes to mashing together departments in film and home video and choosing an exec to run it, there can be only one. Besides eliminating one major maker and buyer of pictures, how great is this merger for an already struggling feature and TV industry?
Here is the latest stuff I’m hearing. Richie Fay, Summit’s former president of distribution, will become president of distribution for Lionsgate; David Spitz will stay on as general sales manager at Lionsgate. That means that Bill Lewis, exec veep and general sales manager for Summit, will likely leave. Chris LeRoy had become defacto head of distirbution for Lionsgate after Steve Rothenberg passed away two years ago after an illness. It’s not exactly clear what happens to LeRoy, who came in on an interim consulting basis, but he’s likely to exit.
Expectations are that with Erik Feig being named president of production of the Lionsgate Motion Picture Group, Lionsgate production topper Alli Shearmur will be leaving. I’ve heard that she might remain involved in The Hunger Games trilogy, perhaps in a producing role. Lionsgate’s Joe Drake has still been reporting to …
First video killed the radio star, and now technology is killing editing and videographer jobs — at least at CNN. The cable news network today laid off 50 staffers in the Atlanta, New York, Washington DC, Los Angeles, and Miami offices. The bulk of the cuts are among editors, photojournalists, and librarians. CNN SVP Jack Womack explained they were caused by the ability for virtually anyone to edit and publish video on their computers, or search for background information online, and by the proliferation of viewer-generated video that is used more and more in professional news coverage, especially on breaking news. “Technology investments in our newsrooms now allow more desk-top editing and publishing for broadcast and online,” he wrote in an internal email. “This evolution allows more people in more places to edit and publish than ever before. As a result of these technology and workflow changes, CNN is reducing the number of media editors in our work force in Atlanta. … We looked at the impact of user-generated content and social media, CNN iReporters and of course our affiliate contributions in breaking news. Consumer and pro-sumer technologies are simpler and more accessible. Small cameras are now high broadcast quality. More of this technology is in the hands of more people. After completing this analysis, CNN determined that some photojournalists will be departing the company.”
It won’t be a good day on the Disney lot. Today, the studio will tell just under 200 staffers that they are being laid off. Deadline told you this was coming, as part of a restructuring effort, with most of those layoffs coming in theatrical and home video distribution. The fact that Pirates of the Caribbean: On Stranger Tides just crossed the $900 million mark in worldwide gross doesn’t change that studio brass felt a restructuring was needed. Fox, Paramount and Lionsgate have also been streamlining their operations and laying off staff as well.
EXCLUSIVE: That’s about 1% of Warner Bros’ total domestic workforce. When I asked about it, Warner Bros Entertainment issued this statement: “As part of the continual review of our business operations, Warner Bros. Entertainment will be undertaking limited staff reductions in our home entertainment and consumer products divisions. The total number of employees and positions impacted by these reductions is a relatively small percentage of our domestic workforce.”
Just because the movies seem to be working this summer and the flood of deals at Cannes indicated that the appetite has returned to the acquisitions business, that doesn’t mean studios are immune to layoffs. Fox has become the fourth studio this week to lop staff. The studio has laid off 12 in home entertainment and 10 in IT. It’s described as a minor realignment that occurred mostly in the analytics group for Fox Home Entertainment and the IT group that supports them. Earlier this week, Paramount shuttered its worldwide acquisitions group under Matt Brodlie. Disney next week will lay off about 5% largely in the distribution area and a few other spots, while Lionsgate laid off less than 20 people as part of a reorganization affecting home entertainment and service areas.
EXCLUSIVE: I began hearing rumors from sources yesterday that The Film Department had laid off its entire staff. Today, I can confirm that it’s a very sad day for that 3-year-old company that financed and produced the hit film Law-Abiding Citizen: it will close as of May 27th. Here’s what happened in summary to Chairman/CEO Mark Gill and Vice Chairman/COO Neil Sacker: Though the company was profitable in 2010 and generated $90 Million in revenues in the last 18 months, The Film Department was not allowed to keep it due to lender stipulations forced upon the company during the credit crisis. So all that money went to lenders. When the company had become profitable and improved its balance sheet by more than $105 million in the last year, it sought to raise $200 million in new private equity and debt to become a U.S. film distributor as well as a financier/producer. But it was unable to close its recapitalization in challenging capital markets.
“What if you made $90 million and your banks wouldn’t let you keep it? Basically, that’s what happened to us,” Mark Gill, Chairman and CEO of The Film Department, said in an exclusive statement to me. “We managed to hold on in this impossible position for 15 months, but we couldn’t survive indefinitely.”
“We came within inches of closing our recapitalization on three occasions, but unfortunately close isn’t good enough,” Neil Sacker, Vice Chairman and COO of the company, said in an exclusive statement to me. “We’re grateful to everyone—filmmakers, talent, financiers, industry experts and our staff—who contributed considerable time, effort, expertise and capital to the company.”
EXCLUSIVE 5:30 PM: There were 7 layoffs among the 40 employees at New Line in recent days: 2 creatives, 1 lawyer, 1 marketing person, and 3 assistants. One contract wasn’t renewed. Decisions are still pending on what other downsizing will follow. Warner Bros decided last February to reduce New Line’s output from 8 movies a year to just 4 as part of movie boss Jeff Robinov’s plan to cut down on the pics which the studio releases and markets in order to be able to focus attention on its major productions. New Line was taken over by Warner Bros in 2008 after Bob Shaye and Michael Lynne were shown the door by Time Warner chief Jeff Bewkes following a string of expensive box office failures: as many as 550 New Line staffers lost their jobs. New Line has the two back-to-back movies of The Hobbit in the pipeline, as well as Jack The Giant Killer, the musical Rock Of Ages with Tom Cruise, the spinoff on Valentine’s Day titled New Year’s Eve, the comedy Horrible Bosses, and the Steve Carell laugher Burt Wonderstone.