Journalists at The New York Daily News and Forbes walked off the job Thursday amid contentious contract talks with management and a difficult few weeks in the news industry.
Both strikes are historic: It’s the first-ever at the business-focused magazine in more than a century, and the first at the storied newspaper in more than three decades, according to the NewsGuild of New York.
The one-day strike at the Daily News coincides with the Forbes walkout, which runs through Monday.
In midtown Manhattan, dozens of Daily News staffers and their supporters picketed Thursday outside a small co-working space — the newspaper’s office since its lower Manhattan newsroom was shuttered in 2020 during the coronavirus pandemic.
Founded in 1919, it was once the largest circulating newspaper in the country.
Strikers marched around the building holding signs that read “New York Needs Its Hometown Paper” and “Alden to News: Drop Dead,” a reference to the tabloid’s famous 1975 headline. They also put up a large inflatable rat that has become increasingly familiar at other union protests.
The labor union’s actions come at a tumultuous time for media outlets, an increasing number of which are owned by billionaires. This week, Time magazine and Condé Nast, the publisher of Vogue, Vanity Fair, GQ, and other marquee magazines, both announced significant job cuts. Staffers at Condé Nast publications went on a one-day strike.
Then the Los Angeles Times laid off more than 100 employees, or more than 20% of its newsroom, with staffers walking out last week in protest.
Meanwhile, more than 200 workers at The Washington Post, owned by billionaire Amazon founder Jeff Bezos, accepted buyouts in the waning days of 2023. And potentially the entire staff at Sports Illustrated could be laid off as the publisher of the iconic magazine faces money troubles.
The Daily News union says their walkout is in protest of cost-cutting moves by owners Alden Global Capital, an investment firm that purchased the storied paper in 2021. The union was formed in 2021 and is negotiating its first contract with the company.
“We are fed up with Alden Global Capital’s constant cuts and apparent commitment to shrinking the paper,” Michael Gartland, a reporter and the union’s steward, wrote on X, formerly Twitter. He cited efforts to curb overtime pay, among other problems.
Unionized journalists at Forbes, who also organized in 2021, said they’re similarly protesting stalled contract negotiations that have lasted more than two years, among other workplace issues.
“Management’s only interest is to delay, stall, and obstruct, as well as try to block our members from protected union action,” Andrea Murphy, an editor and the union’s chair, said in a statement. “We are taking this unprecedented step to show that we will not allow such disrespectful behavior towards our negotiations to continue.”
Spokespeople for The Daily News and Alden Global Capital, which has acquired scores of newspapers across the country and proceeded to impose layoffs and other cost-cutting measures, didn’t immediately respond to emails seeking comment Thursday.
Forbes spokesperson Laura Brusca said the company is “working diligently” to reach a contract with the union. She also confirmed the company told employees Thursday it would lay off less than 3% of its staff.
“We are disappointed by the Union’s decision to stage a walk-out, but respect their right to take this action,” she wrote in an email.
The union called the layoffs another example of the company’s “union-busting” efforts. “We want the company to know, despite their efforts to intimidate us, that we are 100% not backing down,” Murphy said in a statement.
New York Daily News staffers walked off the job Thursday — the paper’s first work stoppage in three decades — to protest “chronic cuts” by its hedge fund owners that “shrink the budget to fill their pockets.”
About 40 members of the Daily News union walked a picket line in the rain around a Midtown Manhattan office building where the News maintains a co-working space that can fit only six people, according to union leaders.
The News — which bills itself as “New York’s Hometown Newspaper” — has been without a home since giving up its Lower Manhattan headquarters at the start of the COVID pandemic in 2020.
The 104-year-old tabloid was scooped up by notorious vulture hedge fund Alden Global Capital, which owns more than 200 newspapers, as part of a $633 million acquisition of Tribune Publishing in May 2021.
Under Alden’s thumb, Daily News workers have “quit in droves” — while new policies require the skeleton staff to get pre-approved for overtime pay.
“Alden wants to act as if we are not being chiseled,” said union steward and Daily News reporter Michael Gartland in the union’s notice.
“We’re not going to engage in that intellectual dishonesty. In reality, we’re being crushed for cash. As a result, staff is diminished, which means our ability to cover the city is diminished. We believe this is bad for New York,” he added.
To make matters worse, there have been no pay raises in six years.
In fact, salaries were slashed by as much as 15% during COVID — partly attributed to reduced expenses for workers because they did not have to come to an office — and were never restored after the pandemic ended.
The paper has 54 union workers and a handful of editors as circulation has fallen to less than 60,000.
Its website had a smattering of updated stories during the day written by the few non-union staffers, who also scrambled to put out a print edition.
Daily News journalists participating in the walkout asked passersby to sign a letter campaign to Daily News executive editor Andrew Julien, saying “that it’s time to stop draining resources and fighting its workers on overtime.”
The Post has sought comment from Alden Capital and Julien.
Editorial staff voted to form a union, part of the NewsGuild of New York, in 2021, but Alden has yet to hold any bargaining for a first contract.
A Daily News reporter confirmed to The Post that more than 94% of the union is participating in the walkout — roughly 50 workers.
“The hedge fund has made changes to overtime policies without bargaining, and now refuses to pay unless the new policies are followed,” said a letter from the union announcing the walkout.
“News breaks around the clock. Hedge fund owners not only don’t understand that but don’t care.”
Alden, following a similar playbook as it has at its other publications, has outsourced the Daily News’ printing operations and sold off the state-of-the-art presses at its former plant in Bayonne, NJ.
It wasn’t all that long ago that a billionaire buying a storied news publication was a sign of hope and optimism. After all, they had money to lose, and they earned their fortunes by creating something new. Maybe they could figure out how to make media work?
And what about private equity? It’s an industry premised on turnarounds: acquiring underperforming companies, reimagining them, and making them succeed.
Or the classic family-owned publication: Keeping a business in the family with no goal of excessive profits, just a certain amount of stability to keep the legacy alive.
Unfortunately, it seems, no category of owner appears able to salvage a media business in decline, with business models still stuck in the past (programmatic, anyone?) and editorial models built for a world before Facebook, TikTok, and artificial intelligence.
The media sector is facing a crisis unlike anything seen since the 2008 financial mess, with layoffs and cost-cutting at every turn. The cuts have all occurred in the backdrop of declining web readership at many major publishers over the past year, as tech giants like Meta (Instagram, Facebook) and Google try to keep consumers on their own platforms while old standby referrers like Twitter/X no longer deliver as many readers and the social media landscape fractures.
The Washington Post, Los Angeles Times, Time, Condé Nast, Sports Illustrated, Business Insider, New York Daily News, National Geographic, and The Baltimore Sun have all been in the news just this month for layoffs, cost-cutting, labor walkouts or bleak prognosticating.
While a sale to private equity has never been greeted by welcome banners from any newsroom, the emergence of wealthy buyers a decade ago largely was, premised on the idea that with a bottomless bank account, the news business would have time — and funding — to figure out its future.
The most notable deal, of course, involved the world’s richest man: Jeff Bezos’ $250 million acquisition of The Washington Post in 2013. But it was far from the only one of that era.
Remember when Facebook co-founder Chris Hughes acquired The New Republic? Or when eBay founder Pierre Omidyar pumped millions into a new venture called First Look Media? Or when BuzzFeed turned down a $1 billion offer from Disney? Or when The New York Times was worried about HuffPost?
Those early deals are largely a distant memory, with Hughes dumping TNR in 2016, First Look Media shedding staff at its businesses like The Intercept and Topic Studios, and BuzzFeed trading at 22 cents a share after shutting down its news division and acquiring HuffPost.
And of course, Bezos’ Washington Post cut hundreds of jobs last month, achieving it through staff buyouts to avoid layoffs.
Of course, a decade ago may as well be a lifetime ago, as far as the media business is concerned. But even more recent deals have shown signs of stress, or in some cases collapse.
Just look at the Los Angeles Times, owned by Dr. Patrick Soon-Shiong, the biotech billionaire who acquired the Times from Tronc (remember it?) for $500 million in 2018.
But Soon-Shiong’s fortune has come under stress, with reports indicating that the value of his stock holdings has fallen by billions of dollars in the past few years.
Soon-Shiong’s flagship hire, ESPN and Washington Post veteran Kevin Merida, resigned this month ahead of substantial and painful job cuts (and amid clashes with the billionaire’s daughter). “Today’s decision is painful for all, but we must act urgently and take steps to build a sustainable and thriving paper for the next generation. We are committed to doing so,” Soon-Shiong told the Times as the layoffs began.
The Times on Thursday said that Terry Tang would become interim executive editor. Staffers at the outlet found out about the hire not from Soon-Shiong, but from TheWrap, according to sources.
And then there’s Time magazine, the flagship publication of the late Time Inc., which was sold to Salesforce founder Marc Benioff in 2018 for $190 million. The company has made progress, with its Time Studios division now accounting for more than $100 million in revenue, about one-quarter of the company’s business, per CEO Jess Sibley.
But as Sibley told staff in a memo Tuesday announcing layoffs at the company: “Over the last 12 months, we have diligently reduced our expenses. There is still more work to be done.” Time, she noted, is not yet profitable.
Forbes, now owned by a Hong Kong-based investment group, announced plans to cut 3 percent of its workforce Thursday. And even rival Bloomberg Businessweek, with its deep-pocketed owners that make money by selling terminals for tens of thousands to Wall Street firms, is going monthly.
And then there’s Sports Illustrated, Time founder Henry Luce’s other big bet. The storied publication is now in the middle of a tug-of-war between 5-Hour Energy drink founder Manoj Bhargava, who controls publisher Arena Group, and Authentic Brands Group founder Jamie Salter, who controls the SI brand and licensed it to Arena.
The staff of SI is stuck in the middle, with Arena laying them off as it talks to ABG about a deal and as ABG simultaneously seeks a new licensor.
The premise of wealth providing an off-ramp to media decline appears to be falling apart.
But private equity has not fared much better. At the New York Daily News, staffers walked out this week to protest owner Alden Global Capital’s cost cuts. And Alden sold The Baltimore Sun to David Smith, the chairman of Sinclair Broadcast Group. “What is left to say about American newspapering?” former Sun reporter and The Wire creator David Simon said in response.
Recurrent Ventures, the owner of brands like Popular Science and Field & Stream (which it has just sold, per AdWeek), raised $300 million from Blackstone and has since laid off some 80 people. And at Business Insider, which is owned by KKR-backed Axel Springer, the news organization laid off 8 percent of its staff Thursday.
At Condé Nast, the esteemed owner of Vogue and The New Yorker controlled by the Newhouse family, executives have been laying off about 5 percent of its workforce and folded Pitchfork into GQ, though the union representing editorial staffers has pushed back on some of the proposed cuts.
The media business has been battered on the business side, where programmatic advertising and legacy brand deals still make up a disproportionate amount of revenue, and on the consumer side, with people who used to get their news from legacy outlets choosing instead to get their news from TikTok, Apple News or more niche digital publications.
Marketers need to be well-served to have a functioning advertising business, and consumers need to be served to have a functioning subscription business, and it seems the moment is meeting neither of them.
And the looming threat of generative AI still hasn’t taken its toll on the business, though executives at every company see what’s coming, as The New York Times’ lawsuit against Microsoft and OpenAI demonstrates.
That may be the key: In 2008, the ad market was battered by the market crash, and new platforms like Facebook, Twitter, and YouTube posed a novel threat to legacy media businesses. It’s just that those traditional businesses didn’t see what was coming at the time.
In 2024, we are in another ad recession, but everyone is more clear-eyed about the state of affairs. And, unlike in the past when it was buoyed by lucrative carriage deals, the TV news industry won’t be immune from the revenue misses that have plagued newspapers and websites. As CNN CEO Mark Thompson wrote to staff on Jan. 17: “The traditional TV universe is shrinking steadily. The shift from linear broadcast to digital means that the audience for all news channels on US cable has fallen by roughly a fifth in just the past two years.”
It just seems like no one, not the billionaires, not the private equity turnaround experts, not the family legacies, have a sure sense of how to make it work.
Ross Levinsohn blasted The Arena Group's board of directors in a resignation letter, citing the recent layoffs at Sports Illustrated and accusing other board members of illegal and negligent behavior.
Levinsohn is the former CEO of The Arena Group — which publishes Sports Illustrated, Men's Journal, and other media brands. He was ousted as CEO in December, weeks after Sports Illustrated was accused of publishing AI-generated articles under fake author names, but remained chairman of the board.
Sports Illustrated laid off most of its staff last week, leaving the future of the iconic magazine up in the air.
He initially posted about his resignation on LinkedIn last week, but leveled new accusations in his outgoing letter, which is undated.
In the letter, Levinsohn cited the layoffs and "union-busting tactics" as reasons for his resignation. He also accused the board of acting illegally and negligently. He did not provide details on his accusations but said he anticipates shareholder lawsuits.
Levinsohn declined to comment to Business Insider.
In a statement, The Arena Group said: "The Company disagrees with the comments in the Resignation Email. The Company believes that Mr. Levinsohn's comments are reflective of a disgruntled former executive who was terminated on December 11, 2023."
"The members of the Board take their fiduciary duties and responsibilities seriously," the company continued in its statement. "The Company's decisions regarding operating expenses, strategic transactions, or otherwise, followed thoughtful process and deliberation and were determined to be in the best interest of the Company and its stockholders."
Read Levinsohn's resignation letter below:
To The Arena Group and the Board of Directors thereof: Effective immediately, I am resigning my position as a board member of The Arena Group. The abhorrent actions of this board over the past six weeks leave me no choice but to resign, despite the years of my life I have put into this company and my fear that the actions which have been taken over the past several months have put this company, its employees, and shareholders at significant risk. The feckless actions and boards inability to stand up to the demands of a minority shareholder and his two board representatives has placed the company in severe distress, and watching what is transpiring in real time makes it impossible to continue to serve. Today's obliteration of Sports Illustrated's storied newsroom and the union busting tactics is the last straw. These actions and the inaction of this board are illegal, riddled with self-dealing, and will almost certainly lead to shareholder lawsuits. In my more than 30 years inside of public and private companies, I've never witnessed more negligence in my career. Ross Levinsohn