News Corp., the media empire controlled by Rupert Murdoch, is shutting down its online division and eliminating more than 200 jobs in an effort to conserve badly needed cash.
The announcement was one of several in recent days by companies that the New Year would involve mass layoffs, and cutbacks in an effort to reduce costs.
Bausch & Lomb have all released statements announcing there would be changes. In some cases, thousands of employees will be affected.
And on Dec. 28, retailer Montgomery Ward, a sturdy American institution announced it was closing its doors after 128 years of business.
News Corp. said in a statement released released late Thursday that it would transfer the production of three major Web sites back to the networks they are associated with —
Fox Broadcasting Company, Fox Sports Television Group, and Fox News Channel.
In so doing, about half of the 450 jobs in the digital division, News Digital Media, will be lost through attrition and layoffs over the next six months, according to company spokesman Andrew Butcher. The remaining jobs will be moved back to the networks.
Butcher said the move would save the company “tens of millions” of dollars, but he declined to be more specific.
News Digital Media was formed in 1997 with the ambitious goal of providing fresh editorial content for the online components of News Corp.’s broadcast outlets, FoxNews.com, FoxSports.com and Fox.com.
Disappointing Earnings Spur Changes
Bausch & Lomb Inc. also said it would be cutting back its workforce.
The world’s largest eye-care company, which employs about 12,000 people, said demand for laser eye surgery has dipped recently “in tandem with the deceleration in the overall U.S. economy.”
It said it would be cutting 350 jobs, or 2.9 percent of its work force, on top of 450 cuts disclosed just three months ago, citing a slowdown in sales of laser vision-correction machines.
It also forecast lower earnings today for the fourth quarter and for all of 2001 than Wall Street expected.
The 800 job cuts will save Bausch & Lomb about $20 million this year and $40 million in annual costs starting in 2002. The company said it will record a pretax charge of $41 million in the fourth quarter and $9 million in this year’s first quarter.
Bausch & Lomb lowered its fourth-quarter earnings projection to 69 to 71 cents a share when one-time items are excluded, down from 88 cents in last year’s fourth quarter. Analysts surveyed by First Call/Thomson Financial had anticipated a profit of 73 cents a share.
Chief executive William Carpenter said there was a “noticeable slowdown” in purchases of vision-correction machines and in the number of laser eye surgeries in the United States at the end of last year.
Bausch & Lomb said the across-the-board layoffs would hit virtually all of its U.S. plants, from Rochester and St. Louis to Claremont, Calif., Greenville, S.C., and Tampa, Sarasota and Clearwater in Florida. Since July 1995, the company has cut more than 4,000 jobs worldwide.
Is Trouble Brewing?
The slowing economy is also affecting the airline and auto industries. Delta Air Lines Inc. the No. 3 U.S. airline, said today its fourth-quarter revenue and earnings would be lower than expected due to thousands of flight cancellations it blamed on bad weather and pilots refusing overtime.