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Valence Media, which includes digital media brands like The Hollywood Reporter, Billboard and Vibe, is laying off 30% of its employees within its editorial division, according to a memo from co-CEOs Asif Satchu and Modi Wiczyk that went out to staff Tuesday night. In total, around 100 people will be laid off, according to a source familiar with the cuts.
Why it matters: It's the latest media company that's been been forced to take drastic measures to survive the economic fallout of the coronavirus.
- The Wrap reported last week that the Valence cuts could be coming.
- On Tuesday, The Los Angeles Times reportedly sent a letter to 40 employees indicated that they would be furloughed for 16 weeks, and that those furloughs could convert to layoffs.
Details: Around 25% of the Tuesday layoffs hit journalists at those 3 publications, according to a source familiar with the cuts.
- The rest of the editorial division jobs that were cut belonged to a wide array of functions including sales, marketing, technology, social media and events.
- According to a source familiar, both of the company's big magazines, Billboard and The Hollywood Reporter, will undergo reductions in its print frequency.
- Billboard will publish one issue per month throughout the summer and will then resume a more regular cadence in the fall. The Hollywood Reporter is expected to publish slightly less frequently than usual.
Outside of the media division, roughly a dozen employees across the rest of the company were laid off. The rest of the company includes Dick Clark Productions, a production company, as well as the films, television and data divisions of MRC, a Hollywood studio.
- In the memo, the co-CEOs say they provided severance packages to the employees impacted, which includes six months of extended health care.
Between the lines: Valence has taken additional measures to ensure economic stability during the crisis, including hiring freezes and salary reductions.
- The salary reductions "affect only those making more than one hundred thousand dollars per year and increase progressively," per the memo, "with the highest-paid shouldering the biggest percentages."
- The company has created a program that enables employees impacted by salary reductions to recoup their losses based on the future success of the company. The money obtained through the salary cuts will go to a collective pool that will be used to pull from to recoup those losses in the future, according to a source familiar. with the plans.
- The co-CEOs say they will forgo their full salaries and they will not participate in the recoupment program. A source says that the two co-CEOs haven't been taking their salaries for the past 3 weeks.
The big picture: The news comes just days after The Hollywood Reporter editor Matthew Belloni exited the company following reported disputes with company owners over editorial coverage.
- Last week, The Daily Beast reported on emails authored by senior executives at Valence that appear as though executives were pressuring editorial staff to report in a way that favored the parent company.
- According to spokesperson at Valence, the emails forwarded to The Daily Beast lacked context.
In response to that situation, a spokesperson from Valence Media tells Axios that the company is "committed to our publications and to journalistic integrity."
- Valence has been working with the Poynter Institute on creating guidelines on media ethics across the organization.
- "We are, and have been for the past 18 months, in the process of working with the Poynter Institute to follow modern best practices and maintain optimal editorial independence," they said.
- "We have implemented many of Poynter’s recommended changes and recently opened up the discussion beyond our leadership teams to all editorial staff."