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In a bad news, Media-entertainment giant Viacom has announced that it plans unspecified workforce reductions as part of a wide-ranging reorganization to help boost its financial performance in the face of increasing competition.
The company which owns Paramount studios in Hollywood and a range of television channels including MTV and Comedy Central, said in a statement it was unveiling a strategic realignment, including initiatives designed to promote greater cross-brand collaboration, focus on new growth areas, and improve operational efficiency and financial performance.
Chief executive Philippe Dauman said, the strategic realignment, which is largely completed, will allow the company to sharpen the focus on driving long-term growth in a rapidly changing industry.
As per the plans, Viacom will set aside $785 million for the reorganization to cover the costs of job cuts and writing down the value of underperforming’ assets. The company declined to comment further on the number of cuts or provide other details. These changes will result in annualized savings of some $350 million.
According to top sources, Viacom is reorganizing three of its domestic network groups into two new organizations, in a shift to realign sales, marketing, creative and support functions.
The company is also reallocating resources to expand its capabilities in critical business areas including data analysis, technology development and consumer insights, reflecting the rapidly changing media marketplace, shifting consumer behavior and evolving measurement practices.
The new investment in technology could help Viacom compete with firms like Netflix, which gather vast amounts of data on viewing habits to help deliver programs most sought by consumers.
The company will also halt its share buyback program, which has purchased some $15 billion of its target $20 billion.
Viacom expects share buybacks will resume no later than October, the start of its new fiscal year.
Its Paramount Pictures brand produces its own films and distributes for other programmers including DreamWorks Animation.