Consolidation among players in the digital-media is looming as an inevitable outcome — and BuzzFeed CEO Jonah Peretti said he’s interested in joining forces with other companies through potential mergers and acquisitions.
Peretti’s theory is that if BuzzFeed were combined with other media companies, they would be able to get better economic terms for advertising from internet giants Facebook and Google, he said in an interview with the New York Times published Monday.
“If BuzzFeed and five of the other biggest companies were combined into a bigger digital media company, you would probably be able to get paid more money,” he said of the ad revenue that Facebook and Google share with publishers.
“You have Vice and Vox Media and Group Nine and Refinery,” Peretti added. “There’s tons of them that are doing interesting work.”
Peretti declined to identify which companies BuzzFeed has approached about a possible merger. A BuzzFeed rep did not respond to a request for comment.
BuzzFeed — along with other companies in the space reliant on internet ad revenue — have been struggling with stagnating or declining sales over the last two years. BuzzFeed laid off about 100 employees a year ago, and has subsequently made additional cuts including shutting down its podcast team. Meanwhile, other companies are going belly-up: Earlier this month, without warning, Defy Media shuttered operations, leaving the YouTube-centric company’s creator partners in the lurch.
According to the Times, preliminary M&A talks among “a few” digital media companies have taken place, including BuzzFeed.
BuzzFeed is on track to generate over $300 million in revenue for 2018, up from $260 million last year (when the company missed its target of $350 million), the Times reported, citing anonymous sources.
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