Disney-ABC Layoffs 2017: Cord Cutting & Restructuring Causes Job Cuts

Disney-ABC Layoffs 2017
iStock.com/Pattanaphong Khuankaew

Disney Cutting Jobs at Its TV Networks

Employees of entertainment giant Walt Disney Co (NYSE:DIS) are again facing layoffs. This time, it’s Disney’s “ABC Television Group” that’s the victim of the Disney cuts. Cord cutting by entertainment consumers is being blamed for the latest Disney-ABC layoffs, as the traditional U.S. TV industry heads for a decline.

According to an inside source, Disney is cutting about 200 jobs at a number of its television networks. The source said that the latest job cuts are mostly going to affect operations, such as the finance department.

Rumors of the job cuts began making rounds about two months ago, when Disney announced a restructuring initiative to reduce costs at its television channels by about 10%. Back then, it was speculated that up to 300 jobs could be lost.

Disney’s ABC network, including “ABC Entertainment” and “ABC Studios,” will be at the forefront of the job cuts. There will also be job cuts at Disney cable TV channels like “Freeform,” “Disney Channel,” and “Disney Junior” will have layoffs.


The inside source confirmed that “ESPN” will remain safe this time. The Disney-owned sports channel already went through high-profile job cuts earlier this year after subscriber numbers dropped and Disney ran short of money to pay for multi-billion-dollar deals with major sports leagues.

Cable Cord Cutting and Migration to Digital On-Demand Services Hurts TV Industry

Disney has been forced to undertake these cost-cutting measures because its television networks have witnessed a drop in advertising revenue. Advertisers are turning away from traditional television and toward digital platforms, particularly social media, in order to reach their target markets.

Changing American consumer tastes have played a major role in this shift. The millennial generation prefers to seek entertainment via digital on-demand streaming services. The ubiquitous smart handheld devices and high-speed Internet have jointly made a contribution to this trend. The result is obvious. Unlike the baby boomers, millennials are typically not so fond of watching old-school television, which has led to an increase in cable cord cutting.

Online streaming services like “Netflix,” “Hulu,” and “Amazon Prime” have particularly emerged as big threats to traditional cable networks.

Disney Joins Streaming Race with Movie and ESPN Streaming Services

In response to the increasing competition from on-demand streaming services, Disney is introducing its own streaming services. With this strategy in mind, Disney pulled its “Marvel” and “Star Wars” content from Netflix earlier this year.

Disney has just launched its “Movies Anywhere” on-demand streaming service, which hosts movies from famous production studios like Sony Pictures Entertainment, Twentieth Century Fox Film Corporation, and Universal Studios Company LLC—in addition to its own productions.

Meanwhile, Disney CEO Bob Iger is also working on launching a sports-focused ESPN streaming service, in a bid to take on the likes of Amazon Prime and Netflix.

The company has hinted on keeping Disney streaming service costs low for subscribers, thus offering cheaper subscription plans in order to undercut the competition.

All these initiatives indicate that Disney is beginning to slowly shift away from cable TV. If the trend continues, chances are that more Disney-ABC layoffs will follow.


Disney Cuts 200 Jobs From Its TV Networks Division,” Bloomberg, October 12, 2017.

Disney opens up ‘digital locker’ in latest blow against Netflix,” Diginomica, October 12, 2017.

Disney to end Netflix deal and launch its own streaming service,” The Verge, August 8, 2017.