BCE Inc., the parent company of Bell Media, announced its biggest job cut in 30 years. 4,800 employees are facing job losses, several television newscasts are slated for cancellation, and the company plans to sell off 45 out of its 103 radio stations.
Backlash on Massive Layoffs
Top executives from BCE Inc. and Bell Canada have been called to testify about the company's decision to cut about 9% of its workforce this year, gravely impacting newsrooms across the country.
The company blamed its cuts on the federal government and the Canadian Radio-television and Telecommunications Commission (CRTC), claiming that they have taken their time to provide relief to media companies in crisis.
As a result, the layoff announcement angered Prime Minister, Justin Trudeau, who called the move a "garbage decision by a corporation that should know better."
BCE CEO, Mirko Bibic, blamed the job cuts on “unsupportive government and regulatory decisions,” including a recent CRTC ruling that ordered BCE to provide access to its FTTH networks to third-party internet providers in Ontario and Quebec.
It is reported that this ruling will threaten BCE’s profits, which fell more than 20% in 2023, and will potentially allow competitors to benefit from BCE’s infrastructure instead of building out their own broadband networks in Canada’s two most populous provinces.
Bell recently requested the court's permission to appeal the temporary ruling by the CRTC and to delay the implementation of that decision, which would have prevented independent companies from accessing Bell's network to offer their internet services starting in May. However, the court dismissed Bell's motion to delay the decision.
Refinancing Debt
Moreover, BCE raised USD 1.45 billion from the United States bond market to refinance its debt. According to an undisclosed source, the funds will go towards repaying notices due in March and paying for 3800 MHz spectrum licences.
BCE asserted that Bell Media news lost USD 40 million last year which was arguably the same amount the company received from the government last year in the form of lower licensing fees in line with the Online Streaming Act. Minister of Canadian Heritage, Pascale St-Onge, said the company made commitments to news coverage at that time but with its latest action, they won’t be able to fulfill their responsibility.
Company Restructuring
"We intend to reduce capital expenditures by over USD 1 billion over the next two years, including a minimum USD 500 million year-over-year decrease in 2024 alone," said the company in a statement. The restructuring plans are the largest at the company for almost three decades, with cuts expected to occur at several levels, including hundreds of journalists.
On the other hand, BCE did not disclose how many jobs will be eased out within its telecoms division.