SCOOP: Multiple redundancies underway at SCA after internal ‘review’

Publisher & Editor

The impact of declining radio revenue is beginning to count casualties.

Radio Today can reveal that Southern Cross Austereo will make up to 90 roles redundant this week, with a number of employees notified today (December 3), according to sources.

SCA was unable to comment on, nor confirm, the number of people affected as negotiations are continuing. But SCA did, however, provide a statement to Radio Today.

“The entire advertising and media sector is operating in a challenging and difficult market and Southern Cross Austereo has and is being equally affected.

“Management, with the support of the Board, have conducted a comprehensive review of our workforce structure to provide an effective and efficient organisation for now and into the future. These proposed changes will impact some of our people.

“These decisions have not been taken lightly and we are committed to supporting our people as we work through this process.”

MORE READING: ‘There’s no kings or queens here’: Why SCA is hiring a content chief

SCA chief Grant Blackley at the 2019 Radio Alive conference.

Advertising revenue for metro commercial radio stations declined by 10.2% in the 2019 September quarter.

In the same period last year, the radio network’s generated $202.109 million, compared to just $181.432 million this year.

SCA released its financial year results for 2018/19 in October, and despite an increase of 0.5% in overall group revenue, the company reported a net annual loss of $91.3 million. Underlying EBITDA grew marginally by 0.9%

Although the overall result was disappointing, SCA’s audio segment delivered promising results, with a 2.4% increase $453.4 million (that figure combines metro, regional and podcasting).

But the growth in podcasting and on-demand audio hasn’t happened quick enough to save the day.

When it came to metro performance in particular, SCA chief executive Grant Blackley told Radio Today there are three key factors underpinning this year’s performance.

“The first thing is a very consistent and solid performance across all of our FM brands,” he says.

“The second thing would be the continued maturity of our DAB brands, which are now interwoven across our entire radio platform.

“And the third thing is that we’ve had a very strong sales effort that actually has delivered four consecutive improvements in share of our metro market.”

In the latest Standard Media Index, ad spend data showed an 8.5% drop for October.

More to come…

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Glenn
3 Dec 2019 - 11:13 am

Seems like SCA are trying to re-coop all the money they lost from the national re-brandings.
Those poor staffers… right before christmas too.

Grinches.

Dion
3 Dec 2019 - 11:15 am

Merry Christmas from all at SCA.

Gowdy7
3 Dec 2019 - 12:27 pm

ahh, more networking, I can smell it from here!!!

Terry
3 Dec 2019 - 1:06 pm

They did a round of redundancies in August as well.

Barely any staff left.

Sebastian
3 Dec 2019 - 1:48 pm

Here’s the thing. Conventional radio wisdom doesn’t work anymore. The model is broken and these goons are the last to work that out.

I feel for the hard working people affected, but ultimately the wrong heads will be rolling.

Anonomous
3 Dec 2019 - 1:56 pm

My heart goes out to all those at SCA who have lost their jobs. It has more to do with
mismanagement than it has to do with poor market conditions. Poor talent and programming decisions made over the past 5 years have finally caught up with them. Share price will suffer further. ARN and Nova are not sacking people left right and centre are they. I know where I would rather work.

Sally
3 Dec 2019 - 5:46 pm

So many people who have never ran huge media businesses sure are experts on how they should be run! Every media business is flattening out, streamlining, networking etc to reduce costs. Of course they are. Sounds to me like they have used the chance to actually cut some non-performing deadwood from the business. Smart given how hard it is to manage people out these days. People have to be honest about their actual contribution to a business. Rocking up each day isn’t enough. You have to be a serious contributor not a passenger collecting a pay check.
Nova and ARN don’t have to report cutbacks as they aren’t listed with the ASX. SCA must.

Andy Grace
3 Dec 2019 - 6:08 pm

Look, it’s a shocking thing especially for those whose lives have been instantly turned upside down just before Christmas, but to not see something like this coming means a blinkered vision of the ‘commercial’ part of commercial radio.

Radio is an awesome industry to work in, brilliant, fun, amazing people …. but it simply doesn’t have a commercial future, at least not even slightly in the guise we currently see it. Neither will commercial television and hence SCA has double-trouble. TV ratings have been just appalling over the past few years with audiences simply vanishing, while the amount of money spent on OTT content has been staggering … in particular Netflix, Amazon, now Apple and dozens more like them, plus YouTube, Facebook/Instagram, Snapchat, WeChat, Weibo, Twitter – even ABC Online and so many others . The content is and always was king but online it has grown into an empire of enormous breadth and depth. Legacy media’s barely moved in comparison and is now a far, far less compelling option than it was 20 years ago, or even ten years ago.

Sure it’s tough to see the turmoil when you’re in the eye of the storm but media executives should have known better. Radio in particular failed to leverage the medium’s incredible head start in being the first ‘social’ media, instead taking the dot.com dollars on offer in the late 90s, and thinking quarter to quarter. It’s not like I didn’t say this stuff for well over a decade to the highest tier of radio management, but ignoring my next-to-worthless opinion, there was the most obvious lesson in the early 2000s with the long term demise of newspapers, some of which had been a going concern for over 150 years. Their failure to adapt to upstarts like Seek, Realestate, CarSales and many more diverted those torrential ‘rivers of gold’ into nothing more than a trickle.

Full marks to radio sales people who have continued to perform outstandingly well in the face of wildly more compelling offerings along with their realtime analytics. They’re not magicians however and it’s doubtful whether they can continue to perform miracles in the near 0% growth or probable negative quarters ahead. 29 years since the last recession. Have many radio executives even worked in a recessionary environment where advertising is always the first thing to be cut?

Sure there have been some decent rear-guard efforts by radio recently – podcasting in particular – but these have mostly replicated the ‘radio’ experience rather than massively augmenting it with the now just expected media types; near-pro quality instant video and great graphical UX. In fact if anything, podcasting is a step backward because it’s mostly on-demand and can’t give that live, social, audio feedback mechanism radio’s embraced for 60 years.

So where to from here? You’ll see most younger-targeted radio networks fading out. Attitude talk will still be strong for the mid term simply due to the baked-on audience and oldies formats will probably last another decade at least. While youth may not have totally given up on radio as a medium, their TSL will continue to leak away, especially now broadband mobile networks are becoming unlimited data and flat rate. The $70 unlimited 5G option from Optus should put another nail in the coffin of traditional broadcast, especially with LTE-B now starting to get some traction and numerous edge caches giving the user amazingly good video experiences. DAB will always be a overhyped footnote because it’s a hardware standard in a now almost completely software defined world. Too little, far too late.

Super star
3 Dec 2019 - 6:31 pm

I think it’s disgusting that SCA staff find out about this from a industry website that this is happening.

And as of right at this moment they haven’t informed staff.

Thank you Mr Blackley and the SCA board just shows how much you care about your staff

Merry fricken Christmas

Cut the spin, you won't win
3 Dec 2019 - 6:39 pm

In December? Wow. People first indeed. What about the people who have mismanaged the network? Did any of them get the axe? Or will they remain at the top calling the shots?

Market conditions are obviously not the only thing at play unless I missed mass redundancies at Nova, ARN, Grant Broadcasters, Ace and countless other indies…

KP
3 Dec 2019 - 7:06 pm

Sally you’re a real piece of work.
Non-performing deadwood? People have just lost their jobs and you have not one iota of an idea about their performance. Honestly.

Anyone hiring?
3 Dec 2019 - 7:45 pm

Sally – check again. ARN is listed and must report.

Very difficult to compare SCA to another media companies in this instance. They operate in both regional and metro, across both tv and radio – therefore there are a lot of shared services and an abundance of resources that in times like this can be done without. It’s horrible, but it is the way of business.

I am one of those made redundant today and whilst it’s a sh!tty situation, I do believe that SCA has strong leadership.

Good luck to all the others let go today and thank you to all those with supportive comments on here.

SCAStaffer
3 Dec 2019 - 8:48 pm

Sally? I’m floored at your stupid comment. Actually NONE of the people that were let go today were deadwood. Which is the most sad and disappointing part of this. They have lost people who worked hard, were loyal and talented.. and meant a lot to other people in the company. So clearly you don’t work there… and you have no idea.

Deadwood
3 Dec 2019 - 10:24 pm

Remember when the results of one of their little culture surveys suggested their staff didn’t feel secure in their jobs and Grant couldn’t figure out why?
If you’ve lost your job today, ignore the Sally’s of the world, you aren’t deadwood. My guess is you’re hard working and contributed a great deal to SCA.

Nervous Staffer
4 Dec 2019 - 7:25 am

Our bosses refused to innovate the products, the ratings are dropping and now we might lose our jobs?

There’s never been more opportunities in the media industry but they’re blaming market conditions?

I hope some of the 90 are the leaders who’ve allowed this to happen and not us innocent workers who are doing what we were told to do.

T. Bell
4 Dec 2019 - 9:40 am

Guys. The struggles of terrestrial media are well documented and there are no surprises here. Its likely that similar restructures will occur elsewhere and any grounded person working in the business would understand that its very much a gig economy. Radio has done exceptionally well compared to newspaper and tv in maintaining a presence.

Its not much of a Christmas gift but feel proud that you have worked in a privileged position for a iconic company and you have not lost those skills. The value is not the gig but the experience.

Annette
4 Dec 2019 - 10:44 am

Listen to all the unnamed commentators – hiding behind the trees. As an agency observer – I took the liberty of reading their Annual Report for last year to make sure a bit of balance is provided. I read that SCA has about 2500 staff in 55 locations – an about 750 people in Sales. That is a huge number and they serve the market well for our clients.

Lots of agencies and our clients goes through cycles – and this seems no different across the board. The hyperbole is disappointing – everyone should be glad they don’t work in Banking or Auto sectors!

Blake
4 Dec 2019 - 11:17 am

Should have put Bianca Dye on Sydney breakfast while they had the chance…

Staffer
4 Dec 2019 - 11:37 am

Just look at the five SCA Values, the 5th being integrity:
We do what’s right and act with transparency and honesty……….. what a joke.
All my colleagues look at these values and think what a load of crap.

Management wonders why the culture around our offices isn’t the best, let’s do another survey. Are we one of the best places to work….. NO!

Some really good people have left, I’m waiting for the tap on my shoulder……… tap tap.

Another Anon
4 Dec 2019 - 12:11 pm

@ Anonomous
“ARN and Nova are not sacking people left right and centre are they”
No but ARN did just restructure their reps pay packets so they are earning much less – causing a number of staff walking. Looks like they have just gone about their restructure differently

I'm not there anymore, but...
4 Dec 2019 - 12:41 pm

Shouldn’t have bought Redwave for $48m…

Sad to see what is happening to a once great place to work.

Gotcha
5 Dec 2019 - 10:54 am

I remember a breakfast host at a staff meeting once used the analogy of “A” being the red Ferrari, and the “SC” being the tree on the bend…. lets just say the Ferrari was ridden off.
Shortly after, the breakfast host was ushered into the CEO’s office.

Gotcha Fan
5 Dec 2019 - 4:08 pm

Gotcha – I believe the parable went something like this:

There was once was a farmer. He was good at being a farmer, and made a lot of money doing it. He made so much money that one day he went on an adventure to the big city, and bought himself a Ferrari! Thence course being a farmer, he had absolutely no idea how to drive it and he slammed it into a tree.

Steve
7 Dec 2019 - 9:09 pm

Typical example of corporate greed and mismanagement…..I bet it was the little guys at the bottom who got axed and not upper management as usual. Maybe Blakely’s $1.86 million per year needs review….2 weeks before Xmas what a joke !!

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