Take two multi-billion dollar entertainment powerhouses and integrate them and the eventual outcome is a projected loss of between 5,000 and 10,000 duplicative positions and non-critical personnel. For those not living in New York or Los Angeles, Disney has purchased a treasure trove of 21st Century Fox assets for approximately $53+ Billion. In spite of President Trump’s spokesperson, Sarah Huckabee Sanders, who said that this deal “could be a great thing for jobs,” it is suggested that an estimated $2-$3 billion in “synergies” is a code-word for “cost-saving redundancies.” Perusing the annual reports reveals that Disney has approximately 195,000 employees while Fox’s headcount is approximately 22,000.
Fox’s Rupert Murdoch has told employees, ““We are deeply committed to finding opportunities for our people as well as ensuring that anyone impacted is well taken care of.” Since this deal involves broadcast entities requiring government approvals, the timeline centers around regulatory approval by 2019, with the full effects of integration by 2021.
The deal makes sense. For Murdoch, the aging rather conservative mogul who gambles on people and project, can return to his first love, newspapers and the Fox broadcasting (News, Sports, Business) empire, and leave the film and television content creation to others. Disney, as a content creator and distributor, needs a platform to compete with the likes of Netflix and Amazon who have solid platforms and are beginning to create and distribute theatrical-quality content. To this end, Disney will be poised to grab 60% ownership (and control) of the streaming-video Hulu platform (currently equally owned by Fox, Disney, and Comcast, all of whom have 30% stakes; with Time Warner owning the remaining 10%.)
This is one of those moments when the handwriting is on the wall and employees have time to feather their own nests if they believe that they are caught in the duplicative intersection between the two companies.