A Bad Day for BuzzFeed News
After the investigations, politics, science, and inequality teams were offered buyouts, CEO Jonah Peretti says BuzzFeed News going forward will concentrate on “the biggest news of the day, culture and entertainment, celebrity, and life on the internet.”
The lingering questions about the future of BuzzFeed News since the company went public last December turned into existential dread on Tuesday with the announcement that its current top editorial leadership was resigning and staff cuts are coming. Editor-in-chief Mark Schoofs informed the newsroom that he was stepping down and that a corporate mandate for profitability “will require BuzzFeed News to once again shrink in size.” He also announced the departures of deputy editor-in-chief Tom Namako, who is going to be the executive editor of NBC News Digital, and executive editor of investigations Ariel Kaminer. About 30 people in the 100-person newsroom — primarily reporters and editors on the investigations, science, inequality, and politics teams — are being offered voluntary buyouts.
BuzzFeed News has been getting smaller in recent years — under founding editor-in-chief Ben Smith, who left in 2020 following a previous round of layoffs, its headcount was once as high as 250 people — and there has been a steady stream of high-level departures. Last week, managing editor Sara Yasin was named the managing editor of the Los Angeles Times. And there’s been signs that BuzzFeed Inc., whose stock has traded lower than hoped following its stock offering, is putting less emphasis on the BuzzFeed News brand, which was spun out to its own site in 2018. Last week, it said it was shutting down the dedicated BuzzFeed News app. “We’ve found that most of our audience lives on the main BuzzFeed app,” read the announcement. “That’s where our journalism reaches the most people, so that’s why we’ve decided to redirect our resources there.”
Though the news came as a surprise to BuzzFeed News science reporter Dan Vergano, it was far from unprecedented in his career. “We’re all busy calling our ex-editors and asking them to be references if we have to leave and that sort of thing. So it’s the usual routine,” he told The Fine Print. “I don’t know if you’ve seen the language that they put out. It was we’re offering buyouts, we don’t want to do layoffs. That sounds a lot like 2008 language,” said Vergano, who was at the time a science reporter at USA Today, “like take the buyout, or we’ll fire you, which is what happened at Gannett.”
Vergano’s desk is one that was offered buyouts, but he was unsure if he would take one. However, he was sure that this was yet more indication that news industry business models are failing to sustain journalism. “Who can say anything about the news business? What’s going to happen? I’ve been doing it for 30 years. It’s bullshit from beginning to end, crazy bullshit,” he said. “It’s an economic vise that we’re all in. I just want to do good news. It seems like there should be an avenue to deliver that to people. This is just more evidence that it ain’t easy.”
Alex Sherman of CNBC reported that the current cutbacks are the response to “several large shareholders” that the public company now answers to who “have urged BuzzFeed founder and CEO Jonah Peretti to shut down the entire news operation.” One of those shareholders told Sherman that eliminating BuzzFeed News’s $10 million in annual losses “could add up to $300 million” to the company’s total value. When markets closed on Tuesday, the market capitalization of BuzzFeed was $679 million, up 6.5 percent for the day.
But the push for profitability is nothing new. Peretti has set that as a goal for BuzzFeed News for several years now, warning that the company could not subsidize a money-losing newsroom indefinitely. The path to profitability has never been clear, though, as there’s no obvious way for the news unit to contribute to the revenues generated by BuzzFeed’s main businesses around content marketing, video production, and merchandising.
During an earnings call for investors on Tuesday morning, Peretti said, “We are committed to making Buzzfeed News a stronger financial contributor to the larger business.” He added, “This morning, we announced plans to accelerate profitability for BuzzFeed News, including leadership changes, the addition of a dedicated business development group, and a planned reduction in force. We will prioritize investments around coverage of the biggest news of the day, culture and entertainment, celebrity, and life on the internet.”
“I don’t think anyone really understands what’s happening at the moment,” technology reporter Katie Notopoulos told The Fine Print, “other than that Tom Namako was extremely beloved and people are very sad he’s leaving.”
The details of the buyouts have still not been finalized. According to the BuzzFeed News Union, management’s buyout proposal includes a minimum of ten weeks severance with increased payouts based on time spent at the company. “They have to hammer it out with the union,” Vergano said. Addy Baird, the unit chair, declined an interview request, saying she might be able to speak in a few days. “There’s a lot going on and there will be lots to say down the line. Don’t believe everything the bosses tell you,” she tweeted and added, “I am supposed to be on vacation.”
Late on Tuesday, she sent an email to the union and shared it with The Fine Print. “The fact that they aren’t just hitting us with layoffs right off the bat isn’t an act of benevolence, as they’ve implied, but actually because they can’t just decide to do layoffs on a whim anymore,” she wrote, noting that without a collective bargaining agreement, which has been in negotiations for more than two years, management can’t unilaterally lay people off or buy them out. “Spending a year bargaining over economics only to drop a proposal at the very end saying ‘we are going to need to reduce the size of our workforce’ is both fundamentally bad faith and straight up regressive bargaining.”
The future of BuzzFeed News as a standalone group within the company is uncertain. “The language is that they intend to keep doing news, which is great. It’s a great place to do news, I hope that that continues to be the case,” Vergano said. “Conceivably I could still be working for them if they don’t get rid of me.” But he also sees that his work might not fit into the current business model. “Whatever benefit the news division gives to the wider enterprise, they’ve decided they can make do with, it sounds like, less of it,” he said. “So maybe if the point is just to get to the break-even point where it still offers those economic benefits, those intangible benefits in terms of boosting the search engine algorithms, in terms of delivering the non-news content to people, that’s a decision they have to make.”
The departures might also point to a change in the sort of work BuzzFeed News’s reporters produce. “Mark [Schoofs] is very involved in investigations,” said Vergano. “I’ve done a lot of really good work, I have to say, involving public records requests, FOIA lawsuits. I’m involved in lawsuits with a couple of agencies on behalf of the company, which is something Gannett was never generous enough to do, never tough enough to do, and that they did here. Jonah funded that, I appreciate that. Tom [Namako] is a breaking news guy. He’s just a newsman, through and through. And so him leaving, makes you concerned about that direction.”
For Vergano, it felt like the end of an era. “They really cared and it was a lot of fun here,” he said. “I’m sorry to see this turn, whatever it leads to. It’s nice that they are still thinking about doing news in some fashion, but it’s another unfortunate moment in our business.”