Sky is planning to cut 1,000 jobs, representing around 4 percent of the pay-TV company’s 27,000 employees in the UK.
The redundancies will mainly affect technicians who install Sky equipment in homes, reflecting an ongoing shift away from satellite TV to streaming. Sky has been pushing into IPTV (TV delivered via internet) and connected TV (CTV), having launched a range of CTV products over the last three years.
The company released Sky Glass in 2021, a smart TV that aims to replace satellite dishes and set-top boxes; and Sky Stream in 2022, a plug-in device which brings the Sky Glass platform onto third-party TVs.
The news follows Channel 4’s plans to cut 200 jobs as it transitions into a digital-first streaming business. And while Channel 4 is not a pay-TV operation, both announcements indicate a fundamental change in viewing habits. Sky estimates that its internet-based products represent around three-quarters of consumer purchases.
“The launch of Sky Glass and Sky Stream represents a shift in our business to deliver TV over IP rather than satellite,” said a Sky spokesperson. “Increasingly, customers are choosing Sky Glass and Sky Stream which don’t require specialist installation, and that has led us to change the number of roles we need to deliver our services.”
Through the looking Glass
Sky’s pay-TV, broadband and hardware operations make the firm less reliant on advertising than the likes of Channel 4 and ITV, but it has also been impacted by a slowdown in TV ad sales. The broadcaster’s ad revenues dropped 2 percent YoY in 2022, and its parent company recorded an $8.6 billion writedown on the business.
Comcast no longer breaks out specific figures for Sky, but reported losing 111,000 customers across its pay-TV and internet business during Q4 2023. Sky’s UK CEO Stephen van Rooyen also stepped down last week, after almost 20 years at the company.
Ongoing rumours also suggest that Comcast could be looking to sell Sky’s German and Italian operations. Last year, reports revealed that Serie A, Italy’s top-flight football league, was interested in acquiring Sky Italia.
Meanwhile in the UK, Sky is aiming to keep hold of Warner Bros. Discovery (WBD) content currently licensed to Sky. The deal runs until 2025, raising questions over when WBD will launch its Max service in the UK, and whether titles such as House of the Dragon and The Last of Us could pose a flight risk.
But Sky also remains invested in its own original content, trebling its output between 2019 and 2022, when the company spent £500 million on original content. Sky also opened a new film and TV studio at Elstree in 2022, and reportedly remains committed to creating 2,000 roles at the new studios.