MILAN (Reuters) – Italy’s top pay-TV player Sky plans to reduce its total workforce, including contractors, by 25% under a four year re-organisation plan, unions said on Friday, as part of a wider overhaul in response to stiffer competition in the industry.
The cuts are expected to yield savings of about 300 million euros ($356.76 million), national unions Slc Cgil, Fistel Cisl and Uilcom said in a statement, confirming what sources told Reuters earlier.
Sky, owned by U.S. company Comcast, intends to manage the redundancies through agreements with the unions, avoiding unilateral actions, the unions said.
Sky Italia was not immediately available to comment.
Sky currently employs nearly 11,000 people in Italy, including some 5,000 direct employees.
The pay-TV broadcaster’s operating model has been challenged by streaming services like Netflix, Amazon Prime Video and DAZN, which offer flat-rate deals to view movies, series and premium sport content via internet-enabled devices.
In their statement, the unions said the company intends to undertake a broader re-organisation of its activity in Italy in response to tougher competition and the economic crisis which is hammering the economy.
In a blow to its reputation for broadcasting major soccer matches in Italy, Sky in March lost out to sport streaming app DAZN in the battle for the main domestic rights to screen Italy’s top-flight soccer championship, exposing it to the risk of a contraction in its customer base.
Industry sources estimate Sky, which last year launched a broadband offer in Italy, has around 5 million subscribers to its pay-TV services.
“The loss of soccer broadcasting rights related to the Serie A championship leads the company to concentrate further on direct productions,” the unions said, adding it will soon start discussions with the company over its plans.
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(Reporting by Elvira Pollina, writing by Maria Pia Quaglia; editing by Agnieszka Flak, Kirsten Donovan)