Canal+: More cost cutting to come?
July 10, 2019
By Chris Forrester
Canal Plus has announced a near-20 per cent cutting of its workforce, and about 500 jobs. Given France’s tough employment regulations this is a major decision for the pay-TV broadcaster. However, a report suggests there might well be more cost saving to come across Vivendi’s media interests.
Deutsche Bank, amidst its own employee cutbacks (18,000 around the world) put out its analysis of the Vivendi situation on July 9th, saying that earlier cost-cutting has already trimmed around €300 million in expenses in the period to the end of 2018.
The bank says the acquisition of M7, where it identified strong opportunities for cost synergies in subscriber acquisition and management, content production and commissioning, set top box procurement and transmission.
Deutsche Bank said the M7 acquisition was “straight out of the Sky playbook” and where Sky achieved savings of around £200 million by bringing together its Italian and German operations, and helped with the increased clout it had in negotiating sports contracts.
“This could mean a further extension of the cost-cutting programme at Canal Plus. The current cost-cutting programme at C+, has run to €300 million at end 2018, but the company has not guided on further savings beyond this, albeit in interviews, the CEO of C+ has indicated savings could reach €350-360 million by end 2019. We expect savings to go further though. We have in our forecasts a further €150 million of savings (cumulative €500 million) by 2020,” the bank suggests.