Source: Canadian Press

TORONTO — Canada's biggest newspaper publisher, Sun Media, is cutting 600 jobs in Western Canada, Ontario and Quebec as it restructures in the face of harsh economic conditions.

The chain, owned by Montreal-based media giant Quebecor Inc. (TSX:QBR.B), said Tuesday the cuts will trim about 10 per cent of its workforce and most will fall by the end of the year.

"The news industry is being revolutionized and we have to adapt if we want to remain an industry leader," CEO Pierre Karl Peladeau said in a release.

"We need to build a presence and build our brand in the digital universe and we need to do it as quickly as possible. We have to let customers get the information they want on the platform of their choice."

Peladeau said the economic environment is deteriorating quickly, which forced the publisher to make "difficult decisions" at this time of year. The move is expected to result in restructuring costs of about $14 million.

Company spokeswoman Isabelle Dessureault said that expected savings from the staff reduction will be revealed when the company releases its annual report in April.

The company declined to specify how the layoffs would be divided amongst its operations but Dessureaultsaid "everyone is touched" by the changes, which include Sun-branded newspapers across the country and other local papers.

Mail room operations, for which staff count fluctuates based on volume, will not be directly affected by the cuts.

"We believe that the remaining staff will be able to be totally committed to the product," said Dessureault.

"Of course, we'll have to do things differently," she said, adding that the newspaper industry "has to adapt."

Changes at the dailies have not been fully drafted yet, but the plan is expected to include more shared content between the local papers, which means fewer reporters covering national and international stories and in other sections, such as sports.

Quebecor said the cuts are a needed response to a major shift in the print media industry, including the growing popularity of the Internet. The economic slowdown, rising costs and falling advertising revenues were also major factors behind the cuts.

Other major Canadian media companies have been making similar reductions at their operations.

Rogers Communications Inc. (TSX:RCI.B) laid off an unspecified number of employees in its media division, which includes television, publishing and digital operations as well as employees of the Toronto Blue Jays.

Last month, CTV cut about 105 positions, mostly at its "music and youth" channels MuchMusic, MuchMoreMusic and MTV Canada, as well as the CTV News division.

And Canwest Global Communications Corp. (TSX:CGS) slashed 560 positions, or about five per cent of its workforce.

On Tuesday, Detroit's two newspapers - the Detroit Free Press and The Detroit News - announced plans to cut nine per cent of their staff and reduce the number of days of home delivery.

"With an economy in crisis, we need solid, diverse reportage and points of view," said Peter Murdoch of the Communications, Energy and Paperworkers union.

"As media corporations slash their workforce that information flow is being seriously eroded."

Brad Honywill, local president of the Southern Ontario Newspaper Guild, which represents more than 700 Sun Media staff, says he's worried that job cuts will cripple the local media.

"These cutbacks mean there will be more and more shared stories and, consequently, less local news," he said in a release.

"It's our hope, and Sun Media's responsibility, to restore these jobs when the economy improves."

Despite the layoffs at Sun Media, Peladeau said investments will continue to be made into the business.

"We have a responsibility to offer Canadians the type of news coverage they are entitled to expect from the country's largest newspaper publisher, which is to say high-quality journalism focused on local news and exclusive features that meets changing consumer needs and habits," he said.

"We need to build a presence and build our brand in the digital universe and we need to do it as quickly as possible. We have to let customers get the information they want on the platform of their choice."

Last month, Peladeau stepped into the lead position of Sun Media Corp. and the Canoe online operation following what the company called a "disappointing" third quarter.

Quebecor reported that its newspaper operating income fell 13.3 per cent to $52.1 million.

With Peladeau at the helm of both print and Internet media it's expected that he'll encourage a melding of both media over the coming months - though Dessureault said such a move is"not for now."

She also downplayed the chance of future cuts, saying that the company is doing what's necessary at this time.

"We do not think that it will be required to take these decisions later on in addition, but we don't know what the future holds in terms of economic slowdown," Dessureault said.

Sun Media publishes 43 paid-circulation and free dailies under the Sun, Osprey Media and 24 Hours banners and more than 200 community newspapers, shopping guides and other speciality publications.

It is also involved in the operation of SUN TV, a general-interest television station in Toronto.

Parent company Quebecor's shares fell 14 cents, just over one per cent, to $14.99 in morning trading at the Toronto stock market.

© Canadian Press