Disney Studios set to cut up to 5% of workforce

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Walt Dis­ney Stu­dios is ready to elim­i­nate as many as 250 jobs from its staff of about 5,000 peo­ple world­wide as early as next week, unnamed “peo­ple famil­iar with the mat­ter” told the Los Ange­les Times.

The move would reduce Disney’s work­force by up to 5%.

Most of the cuts will take place in Bur­bank, Cal­i­for­nia, said the sources. They asked not to be iden­ti­fied because they aren’t autho­rized to dis­cuss the sit­u­a­tion at the Mouse House.

The reduc­tions are thought to most hurt the studio’s dis­tri­b­u­tion oper­a­tion. Changes in the indus­try include flat the­ater atten­dance, low DVD sales, and wor­ries that 3-D — one of the biggest ben­e­fits for mul­ti­plexes — may not become any more popular.

Also not help­ing the stu­dios are such new forms of dig­i­tal dis­tri­b­u­tion as Amazon.com’s video stream­ing ser­vice and Apple Inc.‘s iTunes down­load store.

For the quar­ter end­ing April 2, Dis­ney announced a 14% drop in home enter­tain­ment revenue.

When you see these kinds of trends, frankly, you don’t need as many peo­ple in the com­pa­nies,” said long­time media ana­lyst Harold Vogel said.

Major fam­ily movies are com­ing steadily to Dis­ney from its Pixar Ani­ma­tion Stu­dios unit, which it pur­chased in 2006 for $7.4 billion.

Nowa­days, Dis­ney is also rely­ing more on films from Steven Spielberg’s Dream­Works Stu­dios, which pays Dis­ney a fee for releas­ing its films, and Mar­vel Enter­tain­ment, which it pur­chased in 2009 for $4 billion.

Other stu­dios have cut back staff in view of more dif­fi­cult busi­ness operations.

Last year, Sony Pic­tures cited chang­ing con­sump­tion pat­terns when it laid off 450 peo­ple. Santa Mon­ica, California-based indie stu­dio Lion­s­gate laid off 17 peo­ple in its home enter­tain­ment divi­sion more recently, although it hired sev­eral in its dig­i­tal divi­sion. Para­mount Pic­tures is expected to trim costs in its home enter­tain­ment divi­sion as well.

[Via Los Ange­les Times — www.latimes.com/business/la-fi-ct-disney-cuts-20110607,0,7590660.story]

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