NBC Universal tightens belt by $500 million

By James Hibberd

LOS ANGELES (Hollywood Reporter) - NBC Universal plans to cut spending by $500 million next year, a figure totaling about 3 percent of the company's annual budget.

Employees were informed of budget cuts in a memo from NBC Universal CEO Jeff Zucker on Friday.

"We are living in a time of unprecedented economic challenges, and it is increasingly clear that the worldwide economic slowdown will continue well into next year," the memo read. "As we have been working on our budgets and planning for 2009, it has become evident that the decline in consumer confidence and spending will impact our operations."

The memo went on to direct division leaders to cut costs by reducing promotion expenses, discretionary spending (such as travel and entertainment and outside consultants) and staffing costs.

The move marks the latest reduction in expenses for NBC Universal. In 2006, the company announced it would cut expenses by about $750 million, including a workforce reduction of about 700 jobs.

The TV networks and studios have been curbing spending, including travel and event budgets, in the face of the economic downturn, but NBC Universal is the first media conglomerate to implement across-the-board companywide cuts.

Reuters/Hollywood Reporter