RAI Announces Emergency Budget Plan
The Italian state broadcaster will out source production work, trim $115 million in restructure.
ROME – The board of directors from struggling Italian state broadcaster RAI on Wednesday unveiled a emergency economic plan aimed at reducing the company’s debt as it seeks to remain above water.
The RAI plan is part of a wider government effort to slash spending and increase revenue in order to reduce investor fears that the country could be forced to default on its sovereign debt.
At RAI, the steps are dramatic: saving an estimated €85 million ($115 million) from reducing costs and selling off assets, mostly in 2012. This is in addition to a €70 million ($95 million) austerity initiative announced in May. If all goes according to plan, the board said RAI could break even by the start of 2013.
The plan involves streamlining the news service, including reducing foreign staff. But RAI said it will maintain eight foreign news bureaus in Beijing, Berlin, Cairo, Jerusalem, London, New York, Paris, and Washington D.C.
The company will also outsource some production work, which will result in closing some divisions, and it will focus more on producing low-cost quality programming rather than on programs that reply on expensive travel or special effects budgets. RAI will also sell much of its real-estate assets and reorganize management to eliminate duplicate services.
Earlier in November, RAI International, RAI’s global presence, said that cutbacks could force it to close its doors starting as soon as January unless it was provided with more resources. It was not immediately clear the impact RAI’s restructuring would have on RAI International’s fate.