Zee Entertainment Enterprises Limited (ZEEL) announced an approximate 50 percent reduction in its workforce at its Technology and Innovation Center (TIC) in Bangalore on Friday, March 29, 2024. While the exact number of employees affected by this decision has not been disclosed, ZEEL, in its previous annual report, mentioned that the TIC had a workforce of over 650 engineers focused on building a digital ecosystem for the company.
The MD & CEO of ZEEL, Punit Goenka, stated, “We are laser-focused towards creating exceptional content that is rich and engaging for our viewers. We have a huge responsibility on our hands to live up to the expectations of billions of viewers across the globe and we will continue to win their hearts. To achieve this, we need the blend of a creative approach, detailed consumer insights and futuristic technology.”
This comes weeks after the President of Technology and Data at Zee, Nitin Mittal, resigned from his role. Taking charge of pivotal roles, Amrit Thomas will spearhead data science initiatives, while Kishore Krishnamurthy will take leadership in engineering. Additionally, Bhushan Kolleri will oversee the product, and Vishal Somani will take charge of enterprise and content technology.
The announcement however was not unprecedented, as during an earnings call for Q3 FY24, the MD & CEO of ZEEL, Punit Goenka said, “Tightening our belt on manpower will be part of the plan going forward as we talk about frugality.” He added, “I am not saying that there’s going to be large levels of layoffs, but we will have to see which are the overlaps.”
The company is using the Monthly Management Mentorship (3M) Program to guide the senior management to make crucial decisions to achieve key performance metrics. A committee, comprising company chairman R. Gopalan and audit committee chairman Prakash Agarwal – identified five businesses, including the Hindi channel ‘Zindagi’, its English television channels and communication technology-maker Margo networks, where losses need to be substantially reduced, Zee said. In its report, the committee also presented its analysis of the TIC, where the latter had an approximate expense of 600 crores last year, and recommended cutting expenses by 50 percent for FY 2024-25 to better align with the company’s goals. The report also added that the TIC has developed a substantial level of tools and technology, and needs to focus on ROI.
The decision comes after a continuous struggle over the years, where ZEEL’s advertising revenue declined from $600 million five years ago to $488 million in 2022-23. The company’s cash reserves have also dwindled by about 25 percent over the same period. This gradual decline was followed by a recent failed merger deal with Sony in January earlier this year, where the Japanese company cited Zee’s failure to meet financial terms and demanded a termination fee of $90 million. This has led to an ongoing legal battle between the two companies. ZEEL is trying to prune and restructure its resources with a focus on its core ethos and DNA to target greater profitability and efficiency in daily operations.
