Wednesday, 13 Nov 2019

John Mulligan: 'Quick-fix solutions will not prove a long-term answer to RTÉ's financial troubles'

For businesses cutting costs, axing jobs and wages is most often the simplest and most immediate quick fix.

But when a company’s financial woes are persistent and it’s facing a structural shift in its sector that it still doesn’t quite know how to tackle, those cuts are only a plaster over a wound that needs more acute attention.

RTÉ – and many other traditional media organisations – faces the same dilemma.

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The pace of change in the online sphere has been so rapid, so broad and so deep that it has, for many media organisations, upended all they ever knew about their markets and all they relied on to make ends meet.

Faced with a deteriorating financial position, RTÉ’s plan to save €60m over the next three years is a Herculean challenge without some drastic decisions.

Many of the cost-cutting measures outlined this week, including a 15pc pay cut for top-billing earners, and 10pc for executives, are window-­dressing in the overall scheme of things.

So too is the closure of its Limerick studio and the shifting of Lyric FM production to Cork and Dublin.

The planned 200 jobs cuts will go some way towards reducing the cost base, but as ‘Sunday Independent’ colleague and business editor Samantha McCaughren pointed out in this newspaper on Wednesday, the planned headcount reduction isn’t as dramatic as it first sounds.

She noted that RTÉ ran a redundancy programme in 2017, seeking 300 job cuts. It managed to secure only 160.

That means the 200 announced this week serves only to catch up on that earlier scheme that didn’t achieve its aim.

Other cuts announced this week – including the cessation of digital radio stations and eliminating Aertel – still undoubtedly leave RTÉ management with a big gap to ford to achieve the €60m savings it has targeted.

But even if the savings can be secured in the next three years, it’s the fundamental change to the landscape in which it operates that remains RTÉ’s biggest challenge and one which it urgently needs to address.

It has a track record of great journalism both on radio and TV, and of producing the kind of other content that still draws big audiences. For now.

Coupled with declining market shares, and revenue that has been chiselled away over the past decade, RTÉ has a high-wire act to navigate.

Because at the same time that it’s being assaulted on that front, it must also decide how it stays relevant to a younger audience that has few of the allegiances that those in their forties and older may still have to the national broadcaster.

A generation bombarded with content – and with a wildly broad range of sources from YouTube to Netflix and dozens in between – will hardly be swayed by any notion it should have the same kind of pride in and affinity with a national broadcaster one could have expected 30 or even 20 years ago.

RTÉ can’t obviously compete with the financial firepower and reach of Netflix or YouTube, and it obviously shouldn’t try.

So it needs to be mindful when cutting costs as to what its longer-term aim is, and what it can realistically deliver and achieve within the financial and other boundaries that shape it.

It seems that a radical rethink – by both RTÉ and the Government – about what its core mandate must be is just as important as achieving cost cuts.

And there’s the risk that a wholesale slashing of costs could undermine an organisation that has so much to be proud of – just look at the legacy of the late broadcaster Gay Byrne who passed away this week and the impact he had on so many people in Ireland.

One thing is clear: RTÉ’s future relies on more than just money.

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