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The digital media rollup dream is dead for the moment — now it’s all about core brand strength

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BuzzFeed CEO Jonah Peretti stands in front of the Nasdaq market site in Times Square as the company goes public through a merger with a special-purpose acquisition company on December 06, 2021 in New York City.
Spencer Platt | Getty Images

When a marriage or an engagement fails, it’s common for the participants to take time to work on themselves.

That’s where the digital media industry finds itself today.

After years of focusing on consolidating to better compete with Google and Facebook for digital advertising dollars, many of the most well-known digital media companies have abandoned consolidation efforts to concentrate on differentiation.

“What you’re finding is companies are trying to find a non-substitutable core,” said Jonathan Miller, the CEO of Integrated Media, which specializes in digital media investments. “The era of trying to put these companies together is over, and I don’t think it’s coming back.”

A 90% decline in BuzzFeed shares since the company went public in 2021, a failed sales process from Vice, the collapse of special purpose acquisition companies, and a choppy advertising market have made digital media executives rethink their companies’ futures. For the moment, executives have decided that more concentrated investment is better than attempts to gain scale.

“Right now, everyone’s trying to get through a tougher market by focusing on their strengths,” BuzzFeed CEO Jonah Peretti said in an interview with CNBC. “We’re in this period now where we should just focus on innovating for the future and building more efficient, stronger, better companies.”

What’s happening in the digital media space echoes trends from the biggest media companies, including Netflix, Disney and Warner Bros. Discovery. After losing nearly half their market values, or more, in 2022, those companies have emphasized what makes them different, whether it be distribution, brand or quality of programming, after years of global expansion and mega-mergers. Disney CEO Bob Iger said the word “brand” more than 25 times at a Morgan Stanley media conference this month.

“I think brands matter,” Iger said. “The more choice people have, the more important brands become because of what they convey to consumers.”

Making strategic decisions based on consumer demand rather than investor pressure is a pivot for the industry, said Bryan Goldberg, CEO of Bustle Digital Group, which has acquired and developed a number of brands and sites aimed at women, including Nylon, Scary Mommy, Romper and Elite Daily.

“Too many of the mergers were driven by investor needs as opposed to consumer needs,” Goldberg said in an interview.

The rollup dream’s rise and fall

From late 2018 to early 2022, the digital media industry had a shared goal. Pushed by venture capitalist and private equity investors who had made sizeable investments in the industry during the 2010s, companies such as BuzzFeed, Vice, Vox Media, Group Nine, and Bustle Digital Group, or BDG, were talking to each other, in various combinations, about merging to gain scale.

“If BuzzFeed and five of the other biggest companies were combined into a bigger digital media company, you would probably be able to get paid more money,” Peretti told The New York Times in November 2018, kicking off a multiyear effort to consolidate.

The rationale was twofold. First, digital media companies needed more scale to compete with Facebook and Google for digital advertising dollars. Adding sites and brands under one corporate umbrella would boost overall eyeballs for advertisers. Cost-cutting from M&A synergies was an added benefit for investors.

Second, longtime shareholders wanted to exit their investments. Large legacy media companies such as Disney and Comcast‘s NBCUniversal invested hundreds of millions in digital media in the early and mid-2010s. Disney invested more than $400 million in Vice. NBCUniversal put a similar amount into BuzzFeed. By the end of the decade, after seeing the value of those investments fall, legacy media companies made it clear to digital media executives that they weren’t interested in being acquirers.

With no strategic buyer available, merging with each other using publicly traded stock could give VC and PE shareholders a chance to cash out of investments that were well past the standard hold time of seven years. Digital media companies eyed special purpose acquisition companies — also known as SPACs or blank-check companies — as a way to go public quickly. The popularity of SPACs picked up steam in 2020 and peaked in 2021.

Deal flow accelerated. Vox acquired New York Magazine in September 2019. About a week later, Vice announced it had acquired Refinery29, a digital media company focused on younger women. BuzzFeed bought news aggregator and blog HuffPost in 2020 and then acquired digital publisher Complex Networks in 2021 as part of a SPAC transaction to go public. Vox and Group Nine agreed to a merger later that year.

BuzzFeed, generally thought by industry executives at the time to have the strongest balance sheet with the best growth narrative, successfully went public via SPAC in December 2021. Shares immediately tanked, falling 24% in their first week of trading. The coming weeks and months were even worse. BuzzFeed opened at $10 per share. The stock currently trades at about $1 — a 90% loss of value.

BuzzFeed’s underwhelming performance coincided with the implosion of the SPAC market in early 2022 as interest rates rose. Other companies that planned to follow BuzzFeed shut down their efforts to go public completely. Vice tried and failed. Now it’s trying for the second time in two years to find a buyer. BDG and Vox, meanwhile, abandoned considerations to go public. Vox instead sold a 20% stake in itself in February to Penske Media, which owns Rolling Stone and Variety.

The industry turns inward

Consolidation was always a flawed strategy because digital media could never become big enough to compete with Facebook and Google, said Integrated Media’s Miller.

“You have to have sufficient amount of scale to matter, but that’s not a winning formula by itself,” Miller said.

Vice’s deal for Refinery29 is a prime example of a deal motivated by scale that lacked consumer rationale, said BDG’s Goldberg.

“The digital media rollup has proven successful only when assets are thoughtfully combined with an eye toward consumers,” Goldberg said. “In what world did Vice and Refinery29 make sense in combination?”

Vice is engaged in sale talks with a number of buyers that fall outside the digital media landscape, CNBC previously reported. It’s also considering selling itself in pieces if there’s more interest in parts of the company, such as its TV production assets and its ad agency, Virtue.

Vice is a cautionary tale of what happens to a digital media company when its brand loses luster, Miller said. Valued at $5.7 billion in 2017, Vice is now considering selling itself for around $500 million, according to people familiar with the matter, who asked not to be named because the sale discussions are private.

A Vice spokesperson declined to comment.

“In the old days of media, with TV networks, if you were down, you could revive yourself with a hit,” said Miller. “In the internet age, everything is so easily substitutable. If Vice goes down, the audience just moves on to something else.”

Companies such as BuzzFeed, Vox and BDG are now trying to find an enduring relevancy amid a myriad of information and entertainment options. BuzzFeed has chosen to lean in to artificial intelligence, touting new AI-generated quizzes and other content that fuses the work of staff writers with AI databases.

BDG has chosen to primarily target female audiences across lifestyle categories.

Vox has focused on journalism and information across a number of different verticals. That’s a strategy that hasn’t really changed even as the market has turned against digital media, allowing Vox CEO Jim Bankoff the opportunity to continue to hunt for deals. Just don’t expect the partners to be Vice, BDG or BuzzFeed.

“We want to be the leading modern media company with the strongest portfolio of brands that serve their audiences on modern platforms — websites, podcasts, streaming services — while building franchises through multiple revenue streams,” Bankoff said. “There’s no doubt M&A is part of our playbook, and we expect it will continue to be in the future.”

Finding an exit

While executives may be making strategy decisions with a sharper eye toward the consumer, the problem of finding an exit for investors remains. Differentiation may open up the pool of potential buyers beyond the media industry. BuzzFeed’s emphasis on artificial intelligence could attract interest from technology platforms, for instance.

It’s also possible that there will be an eventual second wave of peer-to-peer mergers. While Integrated Media’s Miller doesn’t expect a future industry rollup, BuzzFeed’s Peretti hasn’t closed the door on the concept if market conditions improve. As executives invest in fewer ideas and verticals, the end result could be healthier companies that are more attractive merger partners, he said.

“If everyone invests in what they’re best at, if you put them back together, you’d have that diversified digital media company with real scale,” Peretti said. “That helps drive commerce for all parts of a unified company. I think it’s still possible.”

Disclosure: Comcast’s NBCUniversal is the parent company of CNBC.

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WNBA Commissioner Cathy Engelbert excited about league’s new media rights deal – Sportsnet.ca

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WNBA Commissioner Cathy Engelbert excited about league’s new media rights deal  Sportsnet.ca

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Ryan Reynolds BLEEDS for Deadpool! Sacrificed Salary to Keep Franchise Alive!

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Marvel fans, rejoice! After a whirlwind journey filled with setbacks and triumphs, Deadpool & Wolverine is finally clawing its way onto the silver screen. This highly anticipated pairing of Ryan Reynolds and Hugh Jackman has had its fair share of challenges, from production delays due to Hollywood strikes to struggling to solidify a cohesive storyline. But through it all, Reynolds’ unwavering dedication to the project has shone through, proving that sometimes, the biggest victories come from the most unexpected sacrifices.

The road to Deadpool & Wolverine began in May 2023 with a triumphant start to filming. However, that momentum was abruptly halted by a wave of strikes that swept through Hollywood, forcing a hiatus until late winter. This wasn’t the only obstacle the project faced. The creative team, including Reynolds himself, wrestled with crafting a narrative that lived up to the outrageous charm of the Deadpool character while seamlessly integrating Wolverine into the fold. There were even whispers of the entire project being shelved altogether, leaving fans anxious about the fate of this dream team.

 

Reynolds’ Pockets Take a Hit, But His Vision Persists

But amidst these uncertainties, a heartwarming detail recently emerged, shedding light on Reynolds’ incredible commitment to the Deadpool franchise. In a revealing interview with The New York Times, Reynolds opened up about the financial sacrifices he made to ensure the success of the original Deadpool film.

“Deadpool wasn’t just a movie; it was a decade-long passion project,” Reynolds confessed. “Honestly, when they finally greenlit it, I wasn’t thinking about box office numbers. I just wanted to see this crazy character come to life on screen. I even gave up my acting salary for the project just to get it off the ground.”

 

However, Reynolds’ generosity didn’t stop there. The studio, it seemed, wasn’t convinced of the importance of having the film’s screenwriters, Rhett Reese and Paul Wernick, readily available on set. “They wouldn’t allow my co-writers on set, which was a huge blow,” Reynolds continued. “So, I took what little money I had left after forgoing my salary and paid them myself to be there. We basically formed a makeshift writer’s room right there on set.”

This wasn’t the first instance of Reynolds’ financial commitment to the Deadpool universe. Writers Reese and Wernick had previously shared on the AMC show Geeking Out that Reynolds also personally financed aspects of Deadpool (2016) to ensure the film achieved the level of quality he envisioned.

 

A Commitment That Reaps Rewards

 

Looking back on the original film’s scrappy beginnings, Reynolds described it as a labor of love fueled by limited resources and boundless creativity. “There wasn’t a lot of money, but I poured my heart and soul into every detail,” he said. “That experience taught me a valuable lesson: the importance of having a strong creative team by your side, no matter the project.”

Reynolds’ unwavering dedication wasn’t just about financial backing; it was about safeguarding the film’s creative vision. His actions ensured that the core team behind Deadpool’s success – the writers, the director, and himself – remained on board to bring their vision to life. This commitment is sure to translate into Deadpool & Wolverine, a film that promises to be a landmark achievement in the wacky world of Deadpool. Mark your calendars, fans – Deadpool & Wolverine slashes into theaters on July 26th!

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Bob Newhart, deadpan comedy icon Dies at 94

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Bob Newhart, the deadpan accountant-turned-comedian who became one of the most popular TV stars of his time after striking gold with a classic comedy album, has died at 94.

Jerry Digney, Newhart’s publicist, says the actor died Thursday in Los Angeles after a series of short illnesses.

Newhart, best remembered now as the star of two hit television shows of the 1970s and 1980s that bore his name, launched his career as a standup comic in the late 1950s. He gained nationwide fame when his routine was captured on vinyl in 1960 as The Button-Down Mind of Bob Newhart, which went on to win a Grammy Award as Album of the Year.

While other comedians of the time, including Lenny Bruce, Mort Sahl, Alan King, and Mike Nichols and Elaine May, frequently got laughs with their aggressive attacks on modern mores, Newhart was an anomaly. His outlook was modern, but he rarely raised his voice above a hesitant, almost stammering delivery. His only prop was a telephone, used to pretend to hold a conversation with someone on the other end of the line.

In one memorable skit, he portrayed a Madison Avenue image-maker trying to instruct Abraham Lincoln on how to improve the Gettysburg Address: “Say 87 years ago instead of fourscore and seven,” he advised.

Another favorite was Merchandising the Wright Brothers, in which he tried to persuade the aviation pioneers to start an airline, although he acknowledged the distance of their maiden flight could limit them. “Well, see, that’s going to hurt our time to the Coast if we’ve got to land every 105 feet.”

Newhart was initially wary of signing on to a weekly TV series, fearing it would overexpose his material. Nevertheless, he accepted an attractive offer from NBC, and The Bob Newhart Show premiered on Oct. 11, 1961. Despite Emmy and Peabody awards, the half-hour variety show was canceled after one season, a source for jokes by Newhart for decades after.

He waited 10 years before undertaking another Bob Newhart Show in 1972. This one was a situation comedy with Newhart playing a Chicago psychologist living in a penthouse with his schoolteacher wife, Suzanne Pleshette. Their neighbors and his patients, notably Bill Daily as an airline navigator, were a wacky, neurotic bunch who provided an ideal counterpoint to Newhart’s deadpan commentary. The series, one of the most acclaimed of the 1970s, ran through 1978.

Four years later, the comedian launched another show, simply called Newhart. This time he was a successful New York writer who decides to reopen a long-closed Vermont inn. Again Newhart was the calm, reasonable man surrounded by a group of eccentric locals. Again the show was a huge hit, lasting eight seasons on CBS. It bowed out in memorable style in 1990 with Newhart — in his old Chicago psychologist character — waking up in bed with Pleshette, cringing as he tells her about the strange dream he had: “I was an innkeeper in this crazy little town in Vermont. … The handyman kept missing the point of things, and then there were these three woodsmen, but only one of them talked!” The stunt parodied a Dallas episode where a key character was killed off, then revived when the death was revealed to have been in a dream.

Two later series were comparative duds: Bob, in 1992-93, and George & Leo, 1997-98. Though nominated several times, he never won an Emmy for his sitcom work. “I guess they think I’m not acting. That it’s just Bob being Bob,” he sighed.

Over the years, Newhart also appeared in several movies, usually in comedic roles. Among them: Catch 22, In & Out, Legally Blonde 2, and Elf, as the diminutive dad of adopted full-size son Will Ferrell. More recent work included Horrible Bosses and the TV series The Librarians, The Big Bang Theory, and Young Sheldon.

Newhart married Virginia Quinn, known to friends as Ginny, in 1964, and remained with her until her death in 2023. They had four children: Robert, Timothy, Jennifer, and Courtney. Newhart was a frequent guest of Johnny Carson’s and liked to tease the thrice-divorced Tonight host that at least some comedians enjoyed long-term marriages. He was especially close with fellow comedian and family man Don Rickles, whose raucous insult humor clashed memorably with Newhart’s droll understatement.

“We’re apples and oranges. I’m a Jew, he’s a Catholic. He’s low-key, I’m a yeller,” Rickles told Variety in 2012. A decade later, Judd Apatow would pay tribute to their friendship in the short documentary Bob and Don: A Love Story.

A master of the gently sarcastic remark, Newhart got into comedy after he became bored with his $5-an-hour accounting job in Chicago. To pass the time, he and a friend, Ed Gallagher, began making funny phone calls to each other. Eventually, they decided to record them as comedy routines and sell them to radio stations.

Their efforts failed, but the records came to the attention of Warner Bros., which signed Newhart to a record contract and booked him into a Houston club in February 1960. “A terrified 30-year-old man walked out on the stage and played his first nightclub,” he recalled in 2003.

Six of his routines were recorded during his two-week date, and the album, The Button-Down Mind of Bob Newhart, was released on April Fools’ Day 1960. It sold 750,000 copies and was followed by The Button-Down Mind Strikes Back!. At one point the albums ranked No. 1 and 2 on the sales charts. The New York Times in 1960 said he was “the first comedian in history to come to prominence through a recording.”

Besides winning Grammy’s Album of the Year for his debut, Newhart won as Best New Artist of 1960, and the sequel The Button-Down Mind Strikes Back! won as Best Comedy Spoken Word Album. Newhart was booked for several appearances on The Ed Sullivan Show and at nightclubs, concert halls, and college campuses across the country. He hated the clubs, however, because of the heckling drunks they attracted. “Every time I have to step out of a scene and put one of those birds in his place, it kills the routine,” he said in 1960.

In 2004, he received another Emmy nomination, this time as Guest Actor in a Drama Series, for a role in E.R. Another honor came his way in 2007, when the Library of Congress announced it had added The Button-Down Mind of Bob Newhart to its registry of historically significant sound recordings. Just 25 recordings are added each year to the registry, which was created in 2000.

Newhart made the best-seller lists in 2006 with his memoir, I Shouldn’t Even Be Doing This!. He was nominated for another Grammy for Best Spoken Word Album (a category that includes audio books) for his reading of the book.

“I’ve always likened what I do to the man who is convinced that he is the last sane man on Earth … the Paul Revere of psychotics running through the town and yelling `This is crazy.′ But no one pays attention to him,” Newhart wrote.

Born George Robert Newhart in Chicago to a German-Irish family, he was called Bob to avoid confusion with his father, who was also named George. At St. Ignatius High School and Loyola University in Chicago, he amused fellow students with imitations of James Cagney, Humphrey Bogart, Jimmy Durante, and other stars. After receiving a degree in commerce, Newhart served two years in the Army. Returning to Chicago after his military service, he entered law school at Loyola, but flunked out. He eventually landed a job as an accountant for the state unemployment department. Bored with the work, he spent his free hours acting at a stock company in suburban Oak Park, an experience that led to the phone bits.

“I wasn’t part of some comic cabal,” Newhart wrote in his memoir. “Mike (Nichols) and Elaine (May), Shelley (Berman), Lenny Bruce, Johnny Winters, Mort Sahl — we didn’t all get together and say, Let’s change comedy and slow it down.′ It was just our way of finding humor. The college kids would hear mother-in-law jokes and say, What the hell is a mother-in-law?′ What we did reflected our lives and related to theirs.”

Newhart continued appearing on television occasionally after his fourth sitcom ended and vowed in 2003 that he would work as long as he could. “It’s been so much, 43 years of my life; (to quit) would be like something was missing,” he said.

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