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A Sign of the Times

February 8, 2009 05:28 | By

Quantel recently announced that it would not exhibit at NAB 2009.

In a statement released to the press, Quantel CEO Ray Cross said, “It’s not a decision that we’ve come to without a great deal of thought. However in the current general economic climate we quite simply can’t justify the $1 million+ investment that exhibiting at NAB would require. This year we’re being prudent; I’m sure our customers are too.”

“Not going to NAB in this challenging year will allow R&D to focus fully on delivering for our customers,” said Cross. “This year delivery, not marketing, comes first.”

FilmLight has also decided to sit out this year’s show for much the same reason.

Perhaps one small bright spot (for NAB Show organizers at least) is that Avid will be returning to the show this year, after sitting out last year. But all indications are that it will be a smaller, quieter show this year.

Organizers are reporting that in light of the sluggish economy, reduced tourism and higher inventory, the show’s official “partner hotels” in Las Vegas have lowered their rates by 20 to 40 percent below earlier offerings.

“Attending the NAB Show has not been this economical from a housing standpoint in decades,” said NAB executive vice president of conventions and business operations Chris Brown. “We encourage attendees to take advantage of these extraordinary rates and experience the tremendous value the NAB Show offers.”

Economic Crisis Hits Home

Meanwhile, a deepening worldwide economic crisis has caused huge layoffs and restructuring across the industry.

In the fall, Quantel went through a restructuring that involved an undisclosed number of layoffs. In October, Avid laid off 500 employees (some 20 percent of its workforce), after reporting net losses of $66.4 million in its third quarter. The company also sold its Softimage 3-D division to Autodesk as part of its restructuring. In December, Adobe laid off 600 employees. In January, Autodesk announced that it is laying off 750 people or 10 percent of its workforce. Meanwhile, Digital Vision has been under the European equivalent of Chapter 11 protection from creditors.

And of course, Sony announced in December that it was cutting 8,000 fulltime jobs worldwide plus another 8,000 temp and seasonal workers. Panasonic is cutting 15,000.

At press time, Thomson announced that, in an effort to improve its balance sheet, it was planning to divest its non-strategic operations—including Grass Valley and Premier Retail Networks (PRN), an in-store advertising network.

The company, which is seeking financial assistance from the French government, plans to focus on providing services to content creators, leveraging the Technicolor brand with film and television studios.

But the myth that Hollywood is somehow recession-proof is starting to wear a little thin.

I n January, Warner Bros. Entertainment announced plans to eliminate nearly 800 jobs, or 10 percent of its global work force. In October, NBC Universal announced 700 layoffs or 5 percent of its workforce. Viacom, which owns MTV Networks, BET Networks and Paramount Pictures, said it will slash about 850 jobs or 7 percent of its work force.

Also at press time, Disney-ABC TV announced it is eliminating 400 jobs.