Economic crisis hits Berlusconi’s television empire

Since it was founded in 1970, Berlusconi’s media conglomerate Mediaset has played a key role in the businessman’s rise as a political figure. Through television, Berlusconi established his leadership of the Italian center-right-wing electorate, using the media both as a means of spreading his political views and as a source of immense income.

But now the economic crisis has violently hit Mediaset. On the stock exchange it has lost 60% of its value in just one year, its advertising revenue has dropped by 10%, its launch of pay-per-view television has been disastrous, and even its viewership numbers are in decline. It seems that the second-largest private television empire in Europe has lost most of its strength.

Indeed, yesterday all of its headquarters were blocked by a four-hour-long strike, initiated after management decided to make enormous cuts to the budget in order to save 400 million euros over the span of the next three years. For the workers, this means outsourcing, with most of the production sector hired out to another media society. This is not the first time that Mediaset’s management has decided to outsource; this time, however, media giant’s unions are particularly alarmed. Advertising revenue began to fall in November 2011, just after Berlusconi lost his position as Prime Minister, and the presence of a correlation between Berlusconi’s political power and the fortune of his companies comes as no surprise. Furthermore, Spain is a key country for Mediaset, and the Spanish crisis has only helped to make the situation worse.

Sources and more information here