This afternoon brought additional fodder for predictions of a tremulous bubble in digital media: VICE News, the edgy outlet that’s expanded to become a global presence, announced it’s axing 15 jobs in New York and Los Angeles.
Harriet Salem, a foreign correspondent at VICE News, indicated that the layoffs don’t stop at the U.S. border, tweeting that all of the outlet’s editorial team in the UK has been cut:
— Harriet Salem (@HarrietSalem) May 24, 2016
The announcement is good news for Josh Tyrangiel, who will now run VICE News after arriving in October from Bloomberg Businessweek, where he was the top editor.
In a statement, a VICE spokesperson said today’s cuts fit into a larger expansion plan that will ultimately see the company adding jobs and bolstering its daily video, documentary and text offerings. Nearly 20 employees have joined the company of late, new hires are slated to join in the coming weeks, and VICE is planning to announce new editorial and production bureaus in Hong Kong and San Francisco later this year.
“The plan in place will expand VICE’s news offerings across digital and TV, continue the recent of wave of newsroom hires, add additional foreign bureaus and marshal the company’s existing news divisions into one cohesive powerhouse,” the statement read.
VICE News becomes the latest in a line of venture-backed online media companies to announce layoffs or gloomy business news in the last year or so. In March, International Business Times laid off about 15 staffers, trimming headcount by the same amount VICE did today. In April, the Financial Times reported BuzzFeed missed its 2015 revenue goals and was adopting more conservative financial targets in 2016. In that same month, Mashable announced it was cutting about two dozen staffers in a sweeping reorganization that saw it do away with politics and world news coverage.
VICE Media, the parent company of VICE News, has a heavy emphasis on online video, a cable channel and a deal with HBO, which would seem to position it well among its competitors. In addition to Tyrangiel, it’s also lured some big names as of late: Ravi Somaiya and Ryan McCarthy from The New York Times and Madeleine Haeringer, who was recently an executive producer at NBC News.
The slew of layoffs throughout the industry has led some to speculate whether digital media companies can stay afloat solely by maximizing impressions for digital display ads. Venture-backed news startups, the argument goes, are facing serious financial headwinds as ad blockers proliferate and the rise of mobile readership makes banners and popups annoying to users at best, invisible at worst.
Rafat Ali, the founder of Skift and paidContent, proclaimed on his blog in April that 2016 is the year media companies will realize enormous online readership will “finally [get] exposed as a false proxy to actually building a real business.”
That same month, media analyst Ken Doctor offered a more measured outlook in an interview with Poynter, noting that, although digitally-native news wasn’t “cratering,” the cutbacks were an indicator that the companies didn’t have any financial silver bullet.
If anyone expected these new companies to have figured out how to navigate the new world and replace the legacy news companies, they’ve got to think again. There is no secret sauce in news publishing, though the emerging ingredients within it tantalize.
Note: This story has been updated to include comment from VICE.