Layoffs hit Fox following completion of Disney deal
Just days after Walt Disney Co. officially finalized its acquisition of most of 21st Century's entertainment assets, layoffs have begun at Fox properties, The Los Angeles Times reports. Roughly 3,000 layoffs are expected.
Why it matters: This is a big shakeup amid an already tumultuous time in Hollywood. Disney purchased Fox assets — much like AT&T purchased Time Warner last year — in an effort to compete with entertainment tech giants like Netflix and Amazon.
Details: Initial cuts began Thursday, according to the LA Times. Roughly 2 dozen people were let go, most from high-level positions at 20th Century Fox in Los Angeles
The big picture: Disney is inheriting several of 21st Century Fox's entertainment properties, including 20th Century Fox film studio, Fox cable channels including FX and National Geographic, and Fox's 30% stake in Hulu.
- It will be terminating Fox 2000, a movie label under the 21st Century Fox umbrella, Variety reported earlier on Thursday.
- Disney also announced Thursday evening its senior film leadership team following the close of the acquisition.
The job cuts are particularly interesting in the context of another ongoing story. Currently, Democrats have asked the Justice Department to probe the White House for possibly interfering in media mergers, like this one and the one between AT&T and Time Warner.
- In the letter to the Attorney General obtained by Axios two weeks ago, Sen. Chris Van Hollen (D-Md.) asked the DOJ to investigate whether Trump had made "formal or informal inquiries encouraging the Department of Justice to approve or expedite the Disney/Fox merger."
- As Axios has previously reported, the White House wouldn't say whether Trump explicitly supported the Disney-Fox deal, but White House press secretary Sarah Sanders did say he thinks it would be "a great thing for jobs."
Be smart: Synergies are expected when companies this big — with similar businesses — merge, but reports suggest that employees were surprised by the scope and how quickly it was happening. Disney said on an investor call in late 2017 that it anticipated $2 billion in "cost synergies" by 2021 related to the merger, which often means layoffs.