BuzzFeed is shutting down what remains of its award-winning news department, signalling the end of an era for a website that once promised to upend the industry.
Founder Jonah Peretti told staff on Thursday that “the company can no longer continue to fund BuzzFeed News” and would be looking to make substantial redundancies across the company.
He said the whole company had been hit by the pandemic, a troubled stock market listing, a tough economy, a declining stock market, a slowdown in digital advertising, and changing audience habits.
Peretti suggested that there may not be a sustainable business model for high-quality online news. He wrote: “I made the decision to overinvest in BuzzFeed News because I love their work and mission so much. This made me slow to accept that the big platforms wouldn’t provide the distribution or financial support required to support premium, free journalism purpose-built for social media.”
BuzzFeed raised hundreds of millions of pounds from investors in the early 2010s as it surfed the explosion of social networks such as Facebook and Twitter to distribute content. In addition to producing viral content such as quizzes and lists it invested in original news reporting, in the belief this would attract a higher quality of advertiser.
This expensive process involved hiring hundreds of journalists around the world and culminated in the company winning a Pulitzer prize for its reporting.
Peretti said he regretted not holding the company to “higher standards for profitability” and said he “exhausted many other cost-saving measures to preserve as many jobs as possible” including cutting costs and closing physical offices.
Other similar online news sites – including Vox and Vice – that boomed during the 2010s have also struggled as audiences and advertisers moved away from social media and towards video services such as YouTube and TikTok. Insider – formerly known as Business Insider – also announced it was making substantial job cuts on Thursday.
BuzzFeed staff learned about the job losses after being invited to dial into a conference call hosted from a room called “Doomsday”, in line with the company’s tradition of having quirky names for its meeting rooms. When the company made redundancies to its former UK operation staff were invited to hear their fate in a room called “Black Mirror”.
In addition to closing BuzzFeed News, Peretti said there would be substantial job cuts across the rest of the business totalling about 180 redundancies – representing about 15% of the company’s workforce.
As part of the changes, Peretti announced that two leading executives have made the decision to leave the company.
BuzzFeed also owns HuffPost, which will continue to publish news but has also seen deep cutbacks to its coverage in recent years. Peretti said this site was profitable because it had a more loyal audience who visit its homepage directly, rather than relying on social media for distribution.
BuzzFeed’s financial challenges reflect the challenges of the online news industry. At one point in 2014 Disney considered buying the site for about $1bn but no deal could be agreed. The company eventually listed on the stock exchange seven years later, since when its share price has collapsed, with the business currently valued at less than $100m.
The announcement triggered a slew of reactions online, with many journalists mourning the closure of BuzzFeed News.
“Was just at the George Polk Award watching talented BuzzFeed journalists win an award for exposing how a private corporation treated people with severe disabilities and less than a week later BuzzFeed News is shutting down. Sometimes it feels like our industry is in shambles,” wrote Laila Al-Arian, a producer at Al Jazeera English.
Tom Namako, an executive editor at NBC News, tweeted: “BuzzFeed News deserved so much better, and has for a long time.”
“Absolutely devastated for @buzzfeednews. You have to understand that some of the most talented people in our industry were there fighting to keep it alive,” said Sara Yasin, a Los Angeles Times managing editor.
Meanwhile, Kat Tenbarge, a tech and culture reporter at NBC News, tweeted, “This shutdown … highlights the failings of the online information economy. People may *want* information that is newsworthy and accurate, but by design platforms don’t value it.”
Others took aim at Peretti himself, with Jon Christian, an editor at Futurism, writing: “Wild that Peretti doubles down on AI in the same memo where he kills the award-winning BuzzFeed News,” referring to Peretti’s pledge to “bring more innovation to clients in the form of creators, AI, and cultural moments …”
Kate Erbland, an executive editor at IndieWire, wrote: “So, is Jonah Peretti axing himself too, or …? Because in his memo he calls out about half a dozen ways in which he personally screwed BuzzFeed News.”
