As many media observers have noted, journalism is in crisis. With some media outlets severely slashing staff to others like Sports Illustrated last month, laying off its entire staff, the media industry seems to be in a freefall. Now comes word that G/O Media, the digital media company behind popular websites like Deadspin, Quartz, Kotaku, its African-American culture outlet The Root, and The Onion, has begun a major shake-up in its operations by putting several of its website properties up for sale.
Here are five things to know.
G/O Media, owned by private equity firm Great Hill Partners, has decided to sell off individual editorial assets within its portfolio. This marks a departure from its initial strategy of seeking a buyer for the entire collection of brands.
“It’s fair to say they’re looking to divest,” a source told Ad Week. “I think it speaks to the broader market. There is not that much positivity about the future of publishing, so they’re trying to extract as much value as possible.”
The move to divest comes amidst a challenging environment for the media industry, characterized by declining referral traffic from search and social platforms, as well as emerging technological disruptions, Ad Week reported.
Traffic has dropped from 33 million unique visitors in December 2019 to 21 million in December 2023, according to Comscore.
The decision to sell individual properties is driven, in part, by the company’s efforts to extract maximum value from its assets. Satire publication The Onion, one of the company’s properties, is highlighted as a target for divestment due to its lack of profitability, Awful Announcing reported.
“As with many multi-title media properties, we are always entertaining opportunities,” a company representative told Ad Week. “We have sold sites and purchased sites. Having said that, we do not comment on transaction rumors and speculation.”
The company has faced internal challenges and cultural clashes, including controversies surrounding its return-to-office policy and high turnover rates among editorial leadership. Ongoing criticisms of CEO Jim Spanfeller have contributed to an environment of instability within the company, Ad Week reported.
The union contract protecting The Onion’s workforce is an important factor in the sales process. G/O Media’s previous experience with selling Jezebel in November 2023, which involved working around union contracts, underscores the complexities involved in divesting editorial properties.
Prior to the sell of Jezebel, in March 2023, G/O Media sold Lifehacker, to media company Ziff Davis for an unspecified amount.
For sale sign: Photo by MART PRODUCTION: https://www.pexels.com/photo/a-person-holding-a-placard-7414922/various logos