US-based collection society BMI (Broadcast Music, Inc) is laying off “just under 10%” of its total workforce.
The news was first reported by Billboard, which obtained an email sent by President and CEO Mike O’Neill announcing the layoffs.
According to Billboard’s report, published Monday (August 22), and citing a source familiar with the situation, around 30 members of staff are being let go.
Within the note to staff obtained by Billboard, O’Neill told them that he’s “writing to let you know about some difficult actions we took today”.
The email continued: “After a careful and comprehensive review process, we are reducing BMI’s total workforce by just under 10% through a combination of headcount reduction and not filling a number of current open positions. This impacted most departments and is effective immediately.”
BMI had been gearing up for the potential sale months earlier, hiring Goldman Sachs as an advisor in March to explore strategic opportunities., but Bloomberg News reported that BMI said the transaction “is no longer an avenue we are considering.” BMI executives had hoped to sell the firm for at least $1.5 billion.
Elsewhere in O’Neill’s letter, he wrote that the cuts “are necessary for us to ensure that we are best positioned for continued success in the future”.
According to Billboard’s article, O’Neill’s letter stated further that, “I appreciate that you may wonder why, when we regularly highlight how we continue to outperform the competition, this year included, we need to take these difficult steps.”
He added: “It’s a fair question, but our success does not mean that we shouldn’t also take a critical look at our business and ensure we are operating in the most efficient and effective way possible, particularly as we head into uncertain economic times.”
BMI’s annual collections for the 12-month period ending June 30, 2021, reached $1.361 billion.
From its FY 2021 collections ($1.361bn), BMI paid out $1.335 billion to its members; ASCAP’s payout in calendar 2021 stood at $1.254bn.Music Business Worldwide