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Wednesday, June 12, 2013
65 comments:
Jim says: "Proceed with caution; this is a free-for-all comment zone. I try to correct or clarify incorrect information. But I can't catch everything. Please keep your posts focused on Gannett and media-related subjects. Note that I occasionally review comments in advance, to reject inappropriate ones. And I ignore hostile posters, and recommend you do, too."
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So I read that USA Today lost a lot of experienced employees through its "early retirement" program recently. And I presume the motivation of a lot of the people who took the offer was driven by fear -- fear that if they didn't take the buyout, they'd eventually be laid off with a much less generous severance package.
ReplyDeleteMy question is this. What happens next to the people who gambled and stayed? Are they on someone's radar screen? Will they indeed be laid off in the coming months? Or did USA Today's bean counters get enough elderly volunteers to satisfy corporate's appetite for blood?
Would love to hear from some of the older folks at USAT who refused to go and what they expect will happen to them, if anything, in the next year or two. Also would like to hear from some of those who left, but who have no plans to retire.
What happens next to the people who gambled and stayed?
ReplyDelete>>They will be laid off by the end of the year - mostly by Q3.
Are they on someone's radar screen?
>>Yes, of course they are. They wouldn't have initially received a notice if they weren't.
Will they indeed be laid off in the coming months?
>>Yes.
Or did USA Today's bean counters get enough elderly volunteers to satisfy corporate's appetite for blood?
>> There will never been enough of 55+ volunteers to satisfy Gannett. This is why they have this program. These people are worth more to the company to pay them to leave than to keep them until they retire. That's the way the game goes. It's, but that's how it is.
This is the way of life at Gannett now and for the foreseeable future. There's no ways around it. Gannett cannot afford to keep this headcount. The revenue from digital has never and will never keep pace with the loss in print revenue. So, it will be a steady decline over the next 3-5 years.
And since the company has no strategic vision for how to develop additional revenue streams other than advertising, the prospects of growing "the business" is slim to none. This is a short term thinking company. Today it's video. But, no one is thinking about what the company should look like in 2017 and beyond. Day traders on Wallstreet love a short term thinking company because it gives investors money now. But, those in the game for the long haul know this party is over and will be leaning it very soon with whatever take they can get. In 2013 the party will be over by mid-Q3 and definitely by the beginning of Q4.
Heh 12:43 you are about to discover exactly how wrong you are.
DeleteOk 6:33, which part of what I said is wrong, and more importantly, when will it be revealed that it is wrong?
DeleteGannett will continue to reduce its workforce over the next 2-3 years. There's no way they will be able to afford the headcount to support their costs. What evidence do you have to support your argument?
I would be happy to share why I took the early retirement offer and specifically why it was offered. Unfortunately, there are so many sad people lurking here that it's difficult to hold reasoned, mature discussions about important issues. Despite this, here goes: I took it because I am close enough to a time when I planned to take a hard look at cashing in my chips anyway. So, for me, the offer was propitious. The offer was made because USAT management had a ceiling on its payroll budget, kind of like an NFL salary cap. There is a need for some seasoned outside people to supplement the home-grown talent in various online areas. The management did obtain money from another pot to finance the buyouts. I asked one of the top people your question: If I stayed would people like me be at the head of the line should layoffs ensue? The answer was no, that there were no targets on people's backs and that the management was not looking to lay off anybody. Obviously, the corporate gods always have the last word. But life goes on at USAT and the current leadership is a refreshing change from the stodgy suits that came before. OK, time for the blowhards to now follow up this post with the usual conspiracy theories and gripes about Gannett. But, really, this is how the buyout went down and why. Sometimes simple facts can be inconvenient.
ReplyDeleteI decided to stay, but agree with 1:02's assessment.
DeleteThey did buyouts because firing all the old people is illegal. That won't be happening in the future.
1:18 p.m.: I could not have said it better myself. A buyout program is the way to go. It's better than firing everyone 55 and over and risking litigation and a public relations nightmare. Not that Gannett cares much about public relations!!!!!!!!! Who knows? Gannett may lower the buyout age!!! I am 53 so I would love to see Gannett lower the buyouts to my age. I would leave in a split second.
DeleteThey did buyouts because USAT management is unable to actually make the difficult decisions about which jobs and which people should be let go. They also are completely unable to manage out bad performers, which contributes to the ongoing problem.
DeleteSo true. Bubbleheads at the top. Absentee management passing for leaders above that motley crew. Is anyone actually in charge?
DeleteGet ready for something really stupid in the weeks ahead. Callaway just makes one mistake after another and is too oblivious to know better. Glad I took the buyout, because it's not going to be pretty.
Actually 8:41 am, it is Maryam Banikarim who is boring.
ReplyDeleteOh snap! Is that your comeback? So much for answering my question
DeleteUSAT is the largest employer within Gannett and the early retirement acceptances did not meet the goal of staff reduction. The consistent and steady decline in circulation and digital revenue is also continuing its steady decline.
ReplyDeleteDo the math.
If USAT is the company's single-largest employer, I suspect a very close second is The Arizona Republic combined with KPNX-TV in Phoenix.
DeleteThere is a basic lack of understanding by most employees about where USAT fits in terms of number of employees, revenue and profitability. The Arizona Republic on its own, without KPNX, has more employees than USAT. It also generates more revenue and is more profitable. At the highest revenue point in its history, USAT was at best third, behind Phoenix and Detroit. When it comes to profitability, USAT is much, much further down the list, even at its most profitable. Of course, the largest Gannett unit in terms of employees is now GPS.
DeleteMany Gannett properties -- not just the Arizona Republic -- may now be more profitable than USAT, for one simple reason: It's entirely possible that USAT is still losing money, years after the end of the Great Recession.
DeleteA bum selling pencils on a street corner is more profitable than Jim's blog.
DeleteUnfortunately, many of the peoplemwho should have taken the buyouts (especially high salaries, little actually work, no knowledge of webcentric product) remain. Callaway ignores them. But they could have freed up salary space to pay the youngsters a decent bump and reward the people who actually deserve it.
ReplyDeleteReward the people who deserve it. This company? Bwah ha ha ha ha ha ha.
DeleteIf one retires from a Gannett property, does that person qualify to receive health benefits for as long as he/she wants? At the total cost (company paid plus employee of course)?
ReplyDeleteNo you can't. If you qualify for retirement coverage it ends at 65
DeleteIf you receive the buyout you have to pay the Cobra costs of $799 per month for a family - (In Louisiana)
ReplyDeleteJust as a point of order, the USAT buyout does cover medical and dental costs for up to a year, depending on how many years of service. People who took the 55-and-over buyout received two weeks pay for each year worked, up to a max of one year's pay.
DeleteIt was actually a VERY good offer, and no wonder that something like 35+ people took it.
ReplyDeleteThe powers that be do seem satisfied with the resulting budget savings, but the impact on news gathering and production seems more than they expected.
Some of those who left were not vital at all, but many were, despite all the nonsense talk here about over-staffing.
Lots of scrambling at USA TODAY now just to do the most basic things.
And, this problem will continue. Job functions and tasks will merge across employees and departments. People will be asked to take on more tasks and tasks that might be out of their skill set.
DeleteSince they will be asked to do more and do it quicker, people will not have time to be properly trained. Therefore, many many many mistakes will happen (if they haven't been already).
This is what happens to companies who try to do "more with less" without thinking about the long term impact on productivity. But, that's the Gannett way. The company is thinking about cutting costs at all costs to improve their bottomline.
Watch how this will all unfold over the next year or so. They will reap all of what they are currently sowing.
Scooped again Jimbo!! That must sting!!!!
ReplyDelete^^ Ignore. Refuse to feed.
DeleteStill think that 9:25? The guy hasn't had a scoop in years. But he is making $10 a day with this blog.
DeleteThis just in:
ReplyDeleteMcLEAN, VA and DALLAS, TX – JUNE 13, 2013 – Gannett Co., Inc. (NYSE: GCI) and Belo Corp. (NYSE: BLC) jointly announced today that they have entered into a definitive merger agreement under which Gannett will acquire all outstanding shares of Belo for $13.75 per share in cash, or approximately $1.5 billion, plus the assumption of $715 million in existing debt for an enterprise value of approximately $2.2 billion. The transaction, which has been unanimously approved by the boards of directors of both companies, represents a 28.1 percent premium to the closing price of Belo common stock on June 12, 2013.
The combination creates a broadcast “Super Group,” catapulting Gannett into the nation’s fourth-largest owner of major network affiliates reaching nearly a third of all U.S. households. The acquisition nearly doubles Gannett’s current broadcast portfolio from 23 to 43 stations, including stations to be serviced by Gannett through shared services or similar sharing arrangements. Upon completion of the transaction, Gannett’s Broadcast segment will have greater geographic and revenue diversity, with 21 stations in the top 25 markets and will become the #1 CBS affiliate group, the #4 ABC affiliate group, and will expand its already #1 NBC affiliate group position. Following the transaction, Gannett’s Broadcast segment is expected to contribute more than half of the Company’s pro forma total EBITDA, and the Digital and Broadcast segments combined are expected to contribute nearly two-thirds.
The Company anticipates that the transaction will generate approximately $175 million in annual run-rate synergies within three years after closing. The transaction is expected to generate significant free cash flow and be accretive to non-GAAP earnings per share by approximately $0.50 within the first 12 months. The transaction valuation implies a 9.4x average 2011/2012 EBITDA multiple prior to synergies, and a 5.4x multiple assuming expected synergies.
Gracia Martore, President and Chief Executive Officer of Gannett, said, “We are thrilled to bring together two highly respected media companies with rich histories of award-winning journalism, operational excellence and strong brand leadership. We have been successfully transforming Gannett into a diversified multi-media company with broadcast, digital and publishing components across high-growth markets nationwide, and this is another important step in the process. It will significantly improve our cash flow and financial strength, enabling us to quickly pay down debt while remaining committed to disciplined capital allocation. By enhancing our portfolio with one of the largest, most geographically diverse and network-balanced TV station groups in the country, the new Gannett will be well positioned to lead innovation, bolster our existing growth initiatives and take advantage of new opportunities in the emerging digital media landscape.”
Commenting on the transaction, Dunia A. Shive, Belo’s President and Chief Executive Officer, said, “This is an outstanding and financially compelling transaction for our shareholders. It is also a testament to the tremendous value our employees have created over Belo’s long history and to the strength of our brand in the media industry. I am confident that we have found an excellent partner in Gannett – they are a leading media company that shares our commitment to the highest levels of journalistic integrity and embraces an active approach to community involvement. Together, this portfolio of media assets will be well-positioned to capitalize on substantial growth opportunities in the years ahead.”
When your revenue is solely based on advertising, this is what you get. People do not like online ads, mobile ads, tv ads, print ads or any kind of ads.
ReplyDeleteRead carefully how they conducted this study. ComScore counts an online ad as viewable if at least 50% of pixels are in view for at least half a second for a site visitor. That's it! And, that's pretty darn generous. So of these "viewable" ads, how many are actually read, consumed, and understood? Of these "viewable" ads, how many actually compel people to buy something? Online advertising (including the measurement of it) is a complete mess and if your business is dependent on it, your business is a mess.
---
Worse Than You Thought: Nearly Half of Online Ads Aren't Viewed
Tracking Non-Premium Sites Finds Even Fewer Ads Delivered
ComScore raised eyebrows with research last year showing 31% of online display ads are never actually viewed, but upon further review, things are even worse: its latest data indicate 46% of ads are never seen by website visitors.
The latest data comes after more than a year of additional tracking by the company’s Validated Campaign Essentials service, said comScore Chairman Gian Fulgoni in a presentation at the Advertising Research Foundation Audience Measurement 8.0 conference in New York on Monday.
ComScore counts 22 of the top 25 U.S. advertisers as VCE clients, including Procter & Gamble Co. and Kellogg Co. But the new data, suggesting that fewer people see online ads than previously thought, likely owe to the fact the service has branched out beyond premium publishers and blue-chip advertisers in the past year, Mr. Fulgoni said. At many "lower tier" sites, in-view rates are well under 50%, he said.
http://adage.com/article/digital/viewability-half-online-ads/242026/
Gannett to acquire Belo in $2.2 billion deal thanks to everyone over 55 who lost their jobs and all other major layoffs from Gannett
ReplyDeleteA great company gobbled up. What will become of the DMN?
ReplyDeleteUh, they dumped print long ago.
DeleteThe DMN and other newspaper properties have been spun off into a separate company since 2007. They're not part of today's GCI-BLC broadcast acquisition.
ReplyDeleteGannett doubles down on the next legacy media business headed for collapse.
ReplyDeleteSad. So much hate from you and other posters this morning about the Gannett-Belo deal. For you folks, the glass isn't just half empty; it's cracked and chipped. The litany from you and from other blowhards is so predictable and so tiresome: "Gannett is so evil ... blah, blah, blah" ... "Print is dead ... blah, blah, blah" ... "This means more layoffs ... blah, blah, blah" ... "Anybody working at Gannett is a loser ... blah, blah, blah" ... "I am doing so much better after Gannett, but I'm not going to give you any specifics ... blah, blah, blah." You guys definitely need your own blog, so you can sit around in a circle online and go round and round and round with your nattering. Have a good day.
DeleteI forgot to add: "Anybody who disagrees with me/us is a corporate executive ... blah, blah, blah." I am not. I am just a worker bee.
DeleteSo much cheerleading from you. Everything Gannett does is great, Gannett serves the greater good, #gannettcares, blah, blah, blah. Truth is that during the last three years Gannett looked very seriously at selling its own TV division as part of its strategic plan. They couldn't get the price they wanted. This is the next defensive move they could make. How does this actually make them a better digital company?
DeleteI rest my case. Please proceed to your circle now, and natter with your pals who can only be negative. Give the rest of us a break from the whining. Thank you.
DeleteIf you want a break from the "whining" you should not visit this site. But you can't resist, can you Gracia?
DeleteThat's right 9:05 is just a lowly pressman in the Midwest. They cheer on Gannett probably due to company stock and the fact that they still have a job. I only read one non positive comment about the merger on this blog and you respond right away complaining that every who comments about it is hateful. You are not worth anymore of my time and I am not 8:53.
DeleteWhiners should form their own site. Many of of us agree with 9:05 a.m. The tiniest shred of even potentially positive news just sets you guys off. Why you seem to get any joy from hoping that your fellow employees (and I wonder how many of you still even work here) get fired or laid off is puzzling and depressing.
Delete10:23 any criticism here of Gannett and the blog gets attacked by people who either work their and think they are the cats meow or maintain a large stock position. The biggest whiners are the few like yourself that whine about any criticism.
DeleteI disagree with you. I agree with 10:23. Criticism is fine and useful when there is a mature discussion of Gannett matters of interest to blog readers. This is not to be confused with the bitter, Pavlovian posts from a thankfully few readers about anything remotely positive. Those people contribute nothing but noise. And their sometimes unhinged screeds say more about them than about what they hate to read here.
DeleteI completely agree with 10:30 and disagree with 10:46. I believe many if not most visitors to this blog come here to vent or read others criticism and positive comments but not the attacks made on Jim and this blog.
DeleteThis comment has been removed by a blog administrator.
Delete11:07, did you have to break the circle to come and make that post?
DeleteLougee immediately moves to the front of the line in the future Martore succession war.
ReplyDeletehttp://dealbook.nytimes.com/2013/06/13/gannett-to-buy-belo-for-1-5-billion/?partner=rss&emc=rss
ReplyDeleteIt's a great deal....for Belo shareholders, though I'd have to wager those stations sold for a fraction of what they would have been worth even five years ago.
ReplyDeleteI'm a little pessimistic on the release's estimate of savings through synergy, which if not fully realized, will likely result in hits to other divisions that have already been decimated.
My sense is Gannett views itself as perhaps holding the line on ad revenue while extracting more money from cable operators for retransmission rights.
And maybe this could also presage the sale of print properties to help pay for this and reduce overhead. Buffett's a buyer. Maybe they could offer up papers like Indy, Cincy, Des Moines and Louisville in a nice package to the Omaha Oracle.
Quit talking so loudly — you'll wake up Jim.
ReplyDeleteThese are the Belo stations Gannett is acquiring:
ReplyDeleteWFAA (ABC) Dallas/Fort Worth, DMA 5
KHOU (CBS) Houston, DMA 10
KING5 (NBC) and KONG (indie) Seattle, DMA 12
KTVK (indie "3TV") and KASW (CW) Phoenix, DMA 13
KMOV (CBS) St. Louis, DMA 21
KGW (NBC) Portland OR, DMA 22
WCNC (NBC) Charlotte, DMA 25
KENS5 (CBS) San Antonio, DMA 36
WVEC (ABC) Norfolk/Virginia Beach, DMA 44
KVUE (ABC) Austin, DMA 45
WHAS11 (ABC) Louisville, DMA 48
WWL-TV (CBS) and WUPL ("My 38") New Orleans, DMA 51
KMSB (Fox) and KTTU (My Network) Tucson, DMA 70
KREM (CBS) and KSKN (CW) Spokane, DMA 73
KTVB (NBC) Boise, DMA 111
KTFT (NBC) Twin Falls, DMA 191
Most of those stations are strong on news, especially WFAA, KTVK and WWL-TV.
"Were" strong on news. Until today.
DeleteThe Phoenix and Louisville stations will be hard to keep. Should be fun to watch the FCC and Congress work that out.
DeleteMore likely that Gannett gets rid of the Courier-Journal, the Arizona Republic and KPNX. Louisville and Phoenix are two cities where TV newscasts are strong.
DeleteI'd also expect Gannett to spin off the Tucson stations and KMOV. The Tucson stations are owned by Belo but operated by a third party. KMOV goes head-to-head with Gannett's own KSDK.
No way that the AZ Republic is divested. Hundreds of millions of revenue there (shrinking margins, but still profitable). Also will be a challenge to pull KPNX out after all the integration.
DeleteLouisville another story. Once a crown jewel in the newspaper division, decline has been rapid there. Maybe Buffet will buy it.
Highly doubt that 9:53. But who knows Gannett management has shown time and time again their disdain for print.
Deletestock is up over $5 so far today.
ReplyDeleteWhen this levels off, SELL!
DeleteI wonder what the Chief Digital Officer thinks about this deal.
ReplyDeletePaging David Payne....
ReplyDeleteGuessing the next move will be to spin out print properties, like News Corp. Retain TV and digital products.
ReplyDeleteBuyouts, layoffs and hours cut to 35 per week in Atlanta for remaining staff.
ReplyDeleteGannett needed to ad revenues to make up for their failure to do so at GPS. This does add more debt at a time when broadcast revenues are going to shrink.
ReplyDeleteTHAT GIRL IS ON FIRE!
ReplyDeleteAND I AIN'T TALKIN' 'BOUT BLUE BALLS!
Like some of the other posters, I'm wondering how Gannett will support the Belo acquisition long-term if the stations don't generate enough revenue. I could see the company going to all or mostly broadcast.
ReplyDelete