Monday, March 05, 2012

USAT | Beusse marshals team of digital outsiders; after 30 years, ‘founders’ begin losing their hold

To appreciate the jaw-dropping expectations Corporate has set for the USA Today Sports Media Group, answer this question: How many individual Gannett properties generate more than $300 million in annual revenue?

I can think of only three: USA Today itself; The Arizona Republic, and CareerBuilder. (And that’s counting all CareerBuilder’s revenue, even though Gannett only owns 53% of the company.)

Beusse
Gannett now wants to add another one to that list: the Sports Media Group, a start-up launched a year ago that Corporate forecasts will gross more than $300 million annually by 2015, according to a Wall Street presentation this month.

Considering GCI’s overall revenue fell again last year, to $5.2 billion, and amid forecasts of anemic growth at least until 2015, a lot is riding on Group President Tom Beusse and his digital team.

How he'll get there over the next three years isn’t clear. Sports Media’s plan is to combine all of GCI’s sports content -- from USAT, the 80 community dailies, plus newly acquired sites like MMAjunkie -- into a single network that can be marketed to advertisers and sponsors.

But that won't be easy. Beusse will need the cooperation of hundreds of other employees in far-flung divisions that often operate as independent silos: USAT; the community papers, broadcasting's 23 TV stations -- plus Gannett Digital, now planning a relaunch of all the company's news websites.

Beusse, who is about 46, was hired in January 2011 after working in magazine publishing and advertising. His last stint, in radio, was as lucrative as it was short-lived: He walked away with a $2.2 million severance package after just 10 months as CEO of Westwood One.

Outsiders taking charge
Last week, he announced a USAT sports department reorganization that put his own digital team firmly in charge. In doing so, he swept aside existing managers with decades of print experience at the paper, which marks its 30th anniversary this year. Critics pounced.

“When you start a staff meeting by telling us the next 10 minutes are more important than the past 30 years,’’ said Anonymous@1:43, “it makes me think you’ll step over anyone to get ahead.”

Beusse's supporters push back. “Someone tries to change things and you immediately call it a disaster,’’ wrote Anonymous@10:08. “Call it what you want but by doing the exact same thing for 30 years, you've ruined a once great product.”

In fact, Beusse isn’t the only newcomer wresting control from a group of aging USAT employees, a select group of whom are called the “founders,” for having been with the paper since its 1982 launch.

Just three days before Beusse’s sports department meeting, Gannett’s chief marketing officer, Maryam Banikarim, announced she had hired a Rodale magazine ad executive for a new position: president of sales, responsible for all Gannett-wide national advertising. (Beusse, too, once worked at Rodale.)

Murcko
This is a major change for USAT, which relies almost entirely on national brands like Chrysler and Verizon for virtually all its ad revenue. The new sales president, Mary Murcko, reports directly to Banikarim, rather than to the newspaper's publisher, Dave Hunke.

Murcko arrives amid weak ad sales, and after a November shake-up in USAT's top ad sales ranks. Across GCI's domestic publishing segment, which includes USAT and the community dailies, fourth-quarter national advertising sales fell 10.1% from a year before vs. a smaller 7.3% decline in overall ad sales.

Banikarim, 43, joined GCI a year ago this month from NBCUniversal. She’s the youngest member of the 12-person Gannett Management Committee, which oversees all GCI operations.

Payne, Gelman over USAT.com
Meanwhile, David Payne took over USAT’s website technology just five months after he was hired as GCI’s chief technology officer. He’s leading a redesign of the site with Mitch Gelman, his second in command at Gannett Digital. Gelman has a journalism background that will undoubtedly steer some of the site’s content.

Payne
Payne, 49, was hired a year ago, also this month, from a tech start-up. Both he and Gelman, hired in August from Examiner.com, worked together at CNN.com.

In USAT’s site relaunch, they're joined by a third newcomer: Augusta Duffey arrived in November for a new position, executive creative director, after nearly 16 years working in the advertising industry.

Looming ahead is the possibility that USAT’s deputy publisher, Susie Ellwood, could fill an opening for the paper's top editor with someone from outside Gannett. John Hillkirk stepped down from that job in November to run the daily’s investigative team; he’s been with the paper since its 1982 launch. Executive Editor Susan Weiss holds the job on an interim basis; she joined the paper in 1983.

Gelman
Hunke arrived as USAT's publisher in 2009, just as the entire newspaper industry convulsed in the Great Recession. The paper’s print ad revenue alone fell by $90 million in 2009, to around $200 million for the full year.

The paper lost 500,000 in circulation as its bread-and-butter hotel buyers changed gears. USAT is now the industry’s No. 2 paper, with 1.8 million copies sold. Counting online-only subscribers, The Wall Street Journal moved to No. 1 with 2.1 million.

Responding, Hunke ordered a reorganization in summer 2010 that included cutting dozens of jobs through layoffs and attrition, and focusing more on digital and mobile delivery to the web, smartphones, and tablets. On its website, the paper says it has 1,400 employees. But that figure’s outdated; the actual number is almost certainly lower.

To be sure, managers who've come from outside have had problems. Rudd Davis left unexpectedly in January just two months after being promoted to president of a new unit, the Travel Media Group. He had come to the paper four years before when USAT bought his action sports side, BNQT.

Another executive brought in, Heather Frank, led an expansion into specialty websites called verticals. She joined the paper in 2010 from a business consultancy and, earlier, AOL. With the verticals struggling, Ellwood in January replaced her with a long-time USAT journalist, Mindy Fetterman.

Hunke’s reorganization brought one of the most radical changes in the paper’s structure, the creation of a separate business that became the Sports Media Group. With Beusse in charge, Gannett’s board of directors gave the expansion a green light last July.

High as the stakes are, the potential rewards for Beusse are likely even greater if he hits that $300 million-plus target by 2015.

A $1M Westwood paycheck
Under U.S. securities law, GCI must report annual compensation for at least the five highest-paid officers. Figures for last year will be disclosed later this month. It’s unlikely Beusse will land in that group, however.

Hunke
Beusse reports to Hunke, who got paid $2.5 million in 2010, including the estimated future value of stock awards.

In his previous job, at Westwood One, Beusse was paid a $700,000 salary and a guaranteed bonus of $300,000.

His plan for USAT’s reorganization requires all the approximately 90 employees to reapply for jobs, with a deadline for completion in 90 days, according to Gannett Blog readers. It’s unclear how many will make the cut.

Dave Morgan, Sports Media Group’s editor in chief since October, is now already in charge of all content -- a radical switch for a paper that’s been led mainly by print people since its start. Morgan came to the group last fall from Yahoo.

Beusse’s supporters are often vocal on this blog.

“I think Beusse is the only one in senior management that actually know what the hell he's doing,’’ says Anonymous@5:54 p.m. “He's the only one who seems to get the fact that as a digitally focused company we should be hiring digital people. . . . That's just good sense.”

But this supporter is cautious, too: “I hope he handles whatever change is coming with dignity and class. If he does, he will once again separate himself from the management riff-raff currently employed at USAT.”

41 comments:

  1. Takes a lot of "Smiling Bob" ads to reach $300 million.

    As for the rest of USAT . . . most national magazines have national ads with local dealers seamlessly included. Don't know why USAT can't custom print papers the same way, especially for hotels that take thousands of copies a day.

    (If they already do this - say with car dealers - never mind.) I used to deliver USAT when it was 25 cents. Can't say I've read it regularly since the TV show died a quick death. Remember what a "sure thing" that was going to be?

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  2. So Doctor ZZZZZ how are you doing with that RD story. Oh thst's right you are waaaay too experienced to be sucked I to doing that. By the way you forgot to mention Gellman has won a Pulitzer. Just a small fact to leave out

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  3. Wonder how much of the 300 million is riding on fantasy sports? Good luck making a move in that already crowded field.

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  4. DECK CHAIRS! Seriously, while Gannett is busy "redesigning" an already failed product, most companies are "reinventing"!

    Gracia do you really believe another "redesign" is going to work? How many publishers have successfully "redesigned" their sites and grew from barely anything to $300mm in revenues?

    STOP redesigning and START innovating! Or you will be dead.

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    1. Jim did a poster just make a threat?

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  5. Well said "My Boss is a Corporate Suit"!!! Between this joke of a re-org and Pointroll stealing personally identifiable information, Gannett is going down the tubes.

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  6. Hunke....Have another single malt baby...no one will notice!

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  7. Beusse, Murcko, Payne, Gelman, Hunke...NOW THAT SOUNDS LIKE A WINNING TEAM"

    They just taste like the real thing, but more expensive. "No-Frills" with a higher price tag.

    Excellent recruiting over there. So glad Gannett attracts the D team. Maryam? What has she ever accomplished? We have a team of "nobodies" going "no where".

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  8. 9:29, if you're referring to 8:42's kicker line, then you really, really need to get help. Obviously to 99.9999 percent of the population, the reference to "dead" was in a figurative, business-related sense.

    As for other properties making that much in revenue: Sure, USAW is on that list with CB, USAT and Ariz Republic, right Jim? Or did the brilliant reorganization there cause those once-lofty revenues to go away?

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    1. How can you be sure?

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  9. There's this juggernaut sports property called....ESPN, you may have heard of it.

    Anyway, yea, Gannett, you're about 30 years late to the show. I don't see you making significant inroads into their territory. The more insulting part of all of this? The Worldwide Leader won't have to change a single shred of their business plan to fend you off. They blew your doors off in sports coverage decades ago.

    Good luck though!!!

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  10. You can rejigger and cry digital and mobile all you want but what used to be called editorial -- reporters and editors -- is what is providing most of the real content for those outlets. Without content that draws eyes and clicks, all you have is a framework with nothing there.

    This is the truth that none of those honchos dare speak.

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  11. In 1992, the Pulitzer Prize for spot news coverage of a fatal subway crash went to the STAFF of New York Newsday while Gelman was a reporter there.

    It wasn't awarded to Gelman or to any other individual, however.

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  12. Jim, $300 million would be the total revenue of most, if not all, of the NT-32 properties combined. In other words, he would be making more in revenue than our 49 smallest USCP newspaper sites combined. If he can deliver those humbers, then we all need to bow down and get the hell out of his way. Our survival depends upon our ability to aggregate all of our platforms into a deliverable, marketable audience solution. To do this, however, we must continue our efforts to marginalize local market and platform leadership, so that McLean can control content (design studios), advertising (president of sales, ad centers), digital (comformity of site design and information delivery) and platform intergration (bringing broadcast/USA Today into the fold) without having to mess around with the publishers/GM/editors at a site. New Gannett, as said again and again on this blog, will be leaner, smaller, more consolidated, more coordinated and less concerned with local uniqueness.

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  13. $3OO million? $3O million is even pie in the sky. grand plans and dreams that will never be realized.

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  14. What? Does Gannett want to replace ESPN or Sports Illustrated? Um... does anyone else see a problem with that model?

    It seems to me that the best and indeed only unique product that USAT Sports potentially has is in its access to local sports information - high school, small college, and community sports teams coverage. Delivery mechanics (print or digital) are a lot less important to the user than the quality of what is delivered. At the same time that corporate is mounting this effort to razzle-dazzle the internets however, the company is shedding the reporters and editors which could write and consolidate that unique local information into marketable packages that would support the aim of the new division, and potentially attract lots of previously untapped ad revenue.

    Makes no practical sense to me.

    In fact, I ask this question seriously and without snark: Has anyone at corporate ever spent any time interviewing users of local information to actually see how they use it and what they expect to get from it? It's obvious that you can't continue to gut local reporting and then purport to be a source of local information. The users will find you out very soon.

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  15. In another example of USAT being chopped up, Banikarim's to-be hired corporate communications VP will also be responsible for the newspaper's PR.

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  16. 3:35 Corporate claims around 50 million unique visitors across all it's network, including, I think, all of CareerBuilders.

    We don't know how many are sports-specific. Apparently, though, there's a decent base to sell to.

    As for the $300 million, we'll likely never know whether that's been reached; Corporate doesn't break out dollar amounts for individual operating units, including USAT itself.

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  17. 2:49 For years now, Martore has been reducing disclosure of data -- including with USAT's.

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  18. First of all, GREAT Post Jim. Very well-done.

    Secondly, how much of that $300 Million includes wcurrent USAT sports revenue? USAT always had deals with the leagues (NFL, MLB, NBA, etc) so how much is new revenue?

    Thirdly, Murcko ONLY has print experience...what a lame hire. Should have been a digital media executive. Bad move Banikarim.

    This whole plan feels like a desperate last ditch effort....let's try something, anything! Good luck Gracia.

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    1. Bit what a negative outlook. Once again condemned before you get a chance to start. It's an incremental 300 million. As far as Mary goes, wait and see. She will run circles around the so called Founders. Don't you love it when a group of folks from Community papers forget their roots and give themselves their own self anointing? This is what they worry about while Rome has been burning.

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  20. 3:39 If that $300M isn't net new, then this is just a shell game.

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    1. It's incremental

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  21. Why is Hunke still employed? What does he do?

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  22. Heidi Zimmerman is doing a fine job, considering, and to allow that mean-spirited sexist comment to stand is completely unacceptable.

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  23. By incremental, you mean. . . ?

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    1. Really Jim? You don't know what that means?

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    2. It means in addition to existing business.

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  25. 6:41 Here's how Merriam defines sexism:

    "Prejudice or discrimination based on sex; especially : discrimination against women."

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  26. Heidi Zimmerman is nice enough and qualified to pump out repetitious and often unclear press posts as Banikarim dictates, but she's not cut out to be the PR powerhouse Martore demands.

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  27. 7:36 No.

    When I post definitions like that, it's for the benefit of readers who seem confused about the meaning of words or phrases.

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  30. There isn't enough to communicate about to have a flak for USA today AND a flak for corporate. Let's hope the new hire realizes that. Spend the money on a content provider or someone to keep Hunke in lone, for chrirsakes.

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  31. Why are there virtually no ads in the paper. Especially sports?

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  32. Heidi is a nice person, but out of her element with the new band of ruthless self promoting carpet baggers Gracia has assembled. The sad thing these people don't realize is bullshitting pie in the sky dreams only gets you so far. And no matter how much bloodletting you plan to rid The home office of alleged complainers and whiners, unless you produce, even the kook aid drinkers eventually turn on you.

    Focus on improving the content and the delivery. You'll get readers. Hire competent people who can sell ads, digital and print. Treat people with a modicum of respect and dignity. Don't rob the candy store while screwing your employees. That's what true leaders do. That is how you position and grow a company and establish an esprit de corps.

    Everything else is just a big waste of time.

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  33. It amazes me that there is no effort whatsoever to retrain Sports dept. people before they are canned. That no changes are implemented until after massive staff upheaval. The car crash that's being manufactured is totally unnecessary. Amazing that the powers that be see nothing wrong with fucking with the lives of 90 staffers and their families. By people who were out of work themselves before Gannett threw them a lifeline.

    Hang down your head Tom Beusse.
    At least for the next 10 minutes.

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  34. Gannett/USA TODAY. A cast-off's refuge from the cold.

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