Viaplay, the pan-European broadcast heavyweight, is letting 25% of its workforce go as part of a new strategy that also involves a significant downsizing of its international market presence, including ending all services in the UK, the US, and Canada.
The embattled network’s chief executive Jørgen Madsen Lindemann said today (July 20) a decision had been made to “regrettably let go of more than 25% of our people," and also to substantially reduce its international presence.
Around 450 people are expected to be hit with redundancies and the cost of Viaplay’s internal restructuring will be roughly $4 million.
The broadcaster is experiencing significant financial difficulties and is having to consider a full sale. Its board chair, Pernille Erenbjerg, announced last week that she would step down due to ill health.
Viaplay only launched in the US and Canada in February and March respectively, having gone live to a UK audience last November. It has been showing an array of both club and national team soccer in the latter market, as well as rugby union, motorsport from the US, and NHL ice hockey.
Going forward, the company will focus on its Nordic operations, as well as on its presence in the Netherlands, and on the international sale of content through Viaplay Select. Viaplay has said it will be “downsizing, partnering, or exiting our other international markets” outside of the Nordics.
Viaplay's direct-to-consumer streaming app is currently available in 13 countries, and the company has a presence to some extent in over 30.
Viaplay will also discontinue low-tier non-sporting content in each of its international markets, “in order to focus on our sports offering.”
Lindemann said the various decisions had been made with a view to “focus our attention and resources on those markets where we can compete for the long term, and ensuring that our products are relevant, popular, and generate healthy returns.”
He added that other aspects of the new Viaplay strategy include “rightsizing and pricing our product offering in the Nordics,” undertaking a significant cost reduction effort, and conducting “an immediate strategic review of the entire business.”
The new chief executive said that various content investments that have been made “are not all paying off,” and that the “pursuit of subscriber volume growth has been at the cost of value.”
The network is now in “discussions with lenders while exploring capital raising alternatives.”
Lindemann, who led Viaplay’s former parent company MTG, took over as chief executive of the company last month, with a new operating model (which now has had the details unveiled) subsequently announced in an effort to mitigate an economic downturn.
Lindemann replaced Anders Jensen after the company announced a downgrade of its short-term outlook for 2023 due to “sharp and rapid deterioration in the television and radio advertising markets.”
It added that “the rising cost of living is resulting in lower [direct-to-consumer] streaming and wholesale linear subscription sales, as well as higher churn levels following price increases.”
Existing non-executive board director Simon Duffy has been appointed interim chair of the board while it searches for a permanent successor to Erenbjerg, who had been a member of the board of directors since May 2020 and chair since May 2021.
In terms of its full-year group operating results, Viaplay has said it expects to record a loss of between SEK850 million ($82.8 million) and SEK1.05 billion.