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BuzzFeed says clickbait revenue not enough to support news business

BuzzFeed's CEO admitted BuzzFeed News wasn't profitable, and apparently would never be.

BuzzFeed's CEO admitted BuzzFeed News wasn't profitable, and apparently would never be.

BuzzFeed is shutting down its news division and laying off around 180 workers after executives at the company determined it could no longer continue to fund the journalism brand as a standalone business.

The announcement was made in a company-wide memo sent by BuzzFeed co-founder and CEO Jonah Peretti on Thursday, which noted that the closure of BuzzFeed News and the associated layoffs were part of a broader reduction in workforce that would see the digital media firm reduce its headcount by 15 percent.

“While layoffs are occurring across nearly every division, we’ve determined that the company can no longer continue to fund BuzzFeed News as a standalone organization,” Peretti wrote.

BuzzFeed News employed around 60 full-time journalists. Some of those workers will be offered positions at HuffPost (formerly the Huffington Post), the digital news outlet BuzzFeed acquired from Verizon in 2020. But the vast majority of the brand’s newsroom workers will be laid off.

BuzzFeed News was launched in 2011 shortly after the hiring of former Politico correspondent Ben Smith. Under Smith’s guidance, BuzzFeed News grew into a scoop machine, publishing exclusive stories that were chased by legacy media outlets, some of whom would go on to poach the talent BuzzFeed cultivated over the years. Last year, the newsroom won a Pulitzer Prize for its coverage of China’s campaign against ethnic Uyghurs (the Pulitzer came after Smith departed for the New York Times; he’s since started his own news outlet called Semafor).

BuzzFeed News had few blemishes over its decade-plus existence. In 2020, the company fired pop culture reporter Ryan Broderick — one of its most-prominent rising stars — after a review of his work turned up numerous instances of blatant plagiarism. Broderick now operates his own newsletter.

BuzzFeed News was also criticized for removing two articles that were critical of high-profile advertisers. A review of the matter ultimately revealed BuzzFeed had deleted more than 1,100 articles from early 2012 to mid-2015, around 100 of which were due to advertiser complaints.

The decision to shutter BuzzFeed News now comes amid a downturn in the advertising market that has impacted traditional and digital media outlets alike. It also comes at a time when more young news consumers are getting information from outlets other than social media, which was a primary driver of traffic for BuzzFeed News.

In his memo on Thursday, Peretti admitted he “overinvested” in the news brand because he liked the high-quality journalism it produced, but said the balance sheet no longer justified operating it as a separate business unless it could turn a profit on its own. He apparently saw path for that to happen.

“The integration process of BuzzFeed and Complex, and the unification of our two business organizations, should have been executed faster and better,” Peretti said, referring to the pop culture brand BuzzFeed acquired in 2021.

Complex, HuffPost and food brand Tasty will also be affected by layoffs, but the precise number of workers impacted from each division wasn’t immediately available.

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About the Author:

Matthew Keys

Matthew Keys is a nationally-recognized, award-winning journalist who has covered the business of media, technology, radio and television for more than 10 years. He is the publisher of The Desk and contributes to Know Techie, Digital Content Next and StreamTV Insider. He previously worked for Thomson Reuters, the Walt Disney Company, McNaughton Newspapers and Tribune Broadcasting.
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