Some real numbers are now emerging from the Cannery Row outtake once considered monolithic news media. TIME Inc. is really taking a battering, dismissing 6 per cent of the work force in an effort to cut $100 million from the budget.
It’s just that the real deficit is more like $800 million for the quarter, and annual revenue is down by about $1.3 billion. Looks like the business models are harder to change than even the most skeptical critics imagined.
TIME itself currently has nothing to say on the subject, which is expected to be discussed at Wednesday’s third quarter report briefing.
On this one page of
The New York Times Media Decoder section, details are emerging of the majors’ retreat from Moscow, and it’s grim reading by any standards. The Wall Street Journal is closing its Boston office, and Canada’s National Post is rumored to be closing on Friday. Forbes is said to be deleting 60 editorial positions.
The human damage: The TIME cutbacks are expected to result in 600 layoffs. Some are covered by union severance provisions, but some aren’t. The layoff will also add even greater numbers to the labor force displaced by recent purges of practically every major news organization.
Another anomaly has arisen from this Scorched Worth policy: The spin merchants aren’t spinning at all on the subject of media downsizing. Nor is the usual pump-priming occurring. Apparently expectations are not being built up. There are no sage predictions of where this industry shakeout will end, or when. The standard business euphemism/wisdom for shakeouts is that the labor force simply redistributes itself across a sector, but that’s not an observed result in this case.
Business model inflexibility is the prime suspect in this rout. The monoliths aren't reacting well to time and tide, and the apparent lack of imagination in "solutions" which involve no more than "layoffs at the gas works" aren't exactly best practice, either. The general appearance is that job design, compensation, and revenue are incompatible, and nobody's trying too hard to change the mix.
Not everybody's being quite this slash-happy. The BBC recently announced a major carve up of senior executive jobs and salaries, equating to a 25% saving. It should be remembered that remuneration in media is just as grasping as Wall Street, and there's plenty of fat in the head of most media organizations, even if the emaciated products look lean and starving.
(I wish this was one of those feelgood "hate management" things, but really, all you need is a calculator and some vestige of business management training to figure out who's delivering what, in terms of revenue.)
The experienced news/magazine labor base looks like it’s dissolving, not redistributing. That is a serious loss, because it also means the training base is falling apart. Most people in media get as much training on the job as they do in college, or more. Losing large numbers of experienced people is generally considered not to be a good idea in most industries. Many employment industry analysts and consultants in the States are currently pushing employee retention schemes, because of the very obvious brain drain effect.
Any mainstreamers reading this: Suggest you get over on our side of the fence, ASAP. At least it’ll still be here in six months. We may not be great fans of your medium, but we can always use literate people on the net.
