Newspaper industry begins 2015 where it left off last year, with notices of job reductions
Digital First Media, The Washington Post and Crain’s among the first to report new staff reductions, following a year that ended with both USA Today and The New York Times announcing layoffs
The end of newsroom layoffs is, sadly, not at hand. As the new year progresses, several media companies have begun new rounds of reductions. The latest is Digital First Media, which Crain’s Detroit Business reports is asking for volunteers from its group of non-union employees at The Oakland Press and Macomb Daily. Just a week ago DFM named Jeannie Parent publisher for the Michigan Region.
Digital First Media is the company formed by the private equity firm Alden Global Capital that combined the assets of the Journal Register Company with Dean Singleton’s MediaNews Group. Just two weeks ago, Ken Doctor, writing in Capital New York, reported that two PEs, Cerberus Capital Management and Apollo Global Management, had made bids on the properties.
It used to be the case that companies would make an acquisition based on headcount reductions and implement the reductions themselves following the sale. But today many companies like to force the seller to do the dirty work themselves. If this is the case here it might be a sign that a sale announcement is imminent. If not, it means DFM is still trying to clean up its books.
Crain’s New York recently reported that AOL was laying off 150 staffers and folding two tech websites, Joystiq and TUAW, into its larger property, Engadget.
A week later another website announced that it was Crain’s New York that would be laying off a large portion of its editorial staff. Talking Biz News reported that Crain’s publisher Jill Kaplan said the business paper need to “re-align the brand’s costs with its revenues.”
Both Gannett and The New York Times went through rounds of layoffs near the end of last year, with the cuts at USA Today called a bloodbath.
The new year has not started out well. The Washington Post was among the first papers to admit that it was cutting staff.
“In recent weeks the Post has moved to trim staff amid rumors about lower-than-expected revenue and budget shortfalls,” Guild News co-chair Fredrick Kunkle wrote to members in a memo posted by the Washingtonian.
“We can’t speak to the budgetary rumors but we can tell you that we’ve heard about the staff reductions. So far, they appear to be small in number. But, as you might expect, they are of enormous importance to the people who are facing dismissal.”
The news of job reductions is particularly disheartening because one sees no end to it. Newspaper executives have determined that the only way forward to survival is either 1) adopting the paid content strategy that deemphasizes the role of the ad sales department, or 2) giving up and divesting print properties. Despite a complete lack of evidence that strategy number one is succeeding, the industry continues onward.
The third way, diversifying revenue streams, creating new products (both digital and print), and making sure the news side of the business maintains its credibility and reliability, appears to not be considered. Only a handful of major papers, such as The Boston Globe, have attempted to diversify their offering by creating eBook lines, new digital magazines, or new web properties.