About a year ago, BuzzFeed CEO Jonah Peretti fired 70 employees, including 47 US-based HuffPost staff, to “promote long-term sustainability.” Today he announced that he would “reduce” the company’s workforce again to “accelerate profitability.” Peretti oversaw the layoffs several times during his tenure at BuzzFeed, each explaining the necessary steps towards profitability. But BuzzFeed, a large digital media conglomerate released through SPAC earlier this year, is now steadily profitable. Revenues of nearly $ 400 million from last year were still well below the borderline fraudulent forecasts they set themselves, which the company cannot deny, but is sound. Last year it was green for the second consecutive year. It reached a profit of $ 25.9 million, up 132% year-on-year. But, as you see, it could be even more beneficial if you simply hack the financially slumping part of the company.
BuzzFeed News, the research arm of a company that does great work around the world, is not a BuzzFeed moneymaker. Thanks to the broken online advertising economy, relentless media integration, the distrustful masses, and the common illness of late capitalism, it is generally not very beneficial to produce good journalism.
At a full-fledged meeting this afternoon, Peretti said it would cut back on BuzzFeed News following the announcement of resignations from BuzzFeed News Editor-in-Chief Mark Schoofs and two other top editors Tom Namako and Ariel Kaminer. .. “There are plans to accelerate BuzzFeed News’ profitability, including leadership changes, the addition of a dedicated business development group, and planned headcount reductions,” he said. Shortly thereafter, Peretti handed things over to a provisional member of the company’s leadership and hung up.
“People are angry that he didn’t ask follow-up questions,” said a BuzzFeed News employee who attended the meeting and characterized the phone as “severe.” Some BuzzFeed staff said publicly as well.
I’m currently attending a conference across the newsroom, and Jonah Peretti left shortly after the Q & A part of the conference began. https://t.co/SYel6UHkwV
— Clarissa-Jan Lim (@clarissajanlim) March 22, 2022
I’ve been working for this company for nearly seven years and have never been so despised as to see the CEO log off without answering a question as to why he wants to destroy my newsroom. https://t.co/oCxLEq1Szk
— Juliareinstein 🚡 (@juliareinstein) March 22, 2022
A BuzzFeed News employee who spoke with Defector said Peretti had done a “faster investigation” and talked about a news team that needed higher metabolism. In other words, more work and faster, but fewer people. In a farewell email, Schoofs emphasized that Cut had nothing to do with the work of the staff. “This isn’t your fault,” he wrote in his email obtained by The Wrap. “You did everything we asked for and created a world-changing incandescent journalism,” Schoofs also said, at least avoiding layoffs due to voluntary takeovers that the company negotiated with the union. He said he wanted.
Reducing and dismissing people who are good at work is only part of the media executive’s business model of setting up a company with the goal of scaling up more than ever. Criminal optimistic Revenue forecasts are inevitably inadequate, and while overall profits are rising, we must engage in some ritualistic bloodshed to appease investors. But targeting BuzzFeed News for the cut was a change for Peretti, and he admitted it at today’s conference. “We no longer subsidize news with revenue from other departments,” BuzzFeed News employees said. For years, Peretti has argued that “news is at the heart of every great media company.” In 2015, he said that BuzzFeed’s work on the news is “good for the world, for the business, and for our culture.” In 2020, after editor and future media mogul Ben Smith left BuzzFeed News, Peretti reiterated his previous stance, saying Smith’s resignation would not change the company’s identity. ..
“We want to do everything we can to continue Ben’s legacy,” Peretti told The New York Times. “We’re breaking news, fearless, and trying to confront the power to do everything that defines what BuzzFeed News is.”
So what has changed? CNBC has one possible explanation. The report released today quoted people who were “familiar with the issue” and said that “several major shareholders urged Peretti to stop the entire news operation.” It also included some incredible stock markets-Man’s Mathematics:
One shareholder said CNBC’s closure of the newsroom could add up to $ 300 million in market capitalization to its struggling stock. The digital media company was released in December through a special purpose acquisition company. Stocks fell nearly 40% immediately in the first week of trading and have not recovered.
Seeing BuzzFeed News become a financial stumbling block to the company and Peretti becoming a hero standing between a roaring investor and the newsroom makes me wonder which anonymous people leaked this bite to the press. Is interesting.As The reporter who wrote the story said it: “The decision by BuzzFeed CEO Jonah Peretti to offer a voluntary acquisition to less than 30 newsroom staff is actually a compromise for some key shareholders who want to abolish the entire BuzzFeed newsroom. It’s an olive branch. ”
After all, even if Peretti was once interested in producing great journalism, it’s no longer really important except for profit margins. BuzzFeed is a public company and exists to make money for investors. Peretti exists to ensure that the company makes the most money for its investors. And that’s how the award-winning newsroom will burn down for no good reason.
Update 7:20 pm ET: BuzzFeed News Union responds
The BuzzFeed News Union Negotiations Committee sent an email to the entire unit, basically saying “not so fast”. The email retrieved by Defector is partly as follows:
Management may not (i) implement layoffs or buyouts unless it is part of a complete collective bargaining agreement (read: Have a ratified union agreement with a power reduction clause .. As you know, we have been working on it for over two years!) Or (ii) there is an economic emergency (more on this below). The company today confirmed that there are no financial emergencies. I’ve heard a lot about “losing money” in the news, but the truth is that we all know. — The news is always at a loss. What’s wild is that you’re doing it with less loss than ever before.
So: What is an emergency? Well, we have passed one. In 2020, there was a financial emergency caused by COVID. So we negotiated a one-time agreement on a slight reduction in power, saved a lot of employment through the proposed worksharing arrangement, and the company finally agreed. But, again, at both meetings with Brew and management’s negotiating committee this afternoon, management confirmed that this was not an economic emergency. Therefore, if a buyout occurs, it must be negotiated as part of a complete collective bargaining agreement.
BuzzFeed did not immediately respond to Defector’s request for comment.