NY Times: BuzzFeed Regroups as Media Turns Video-Centric

BuzzFeed announced recently that it will split its entertainment and news divisions.  

While Buzzfeed has recieved praise for its news and journalism, it is its entertainment sections that drive most of its traffic and revenue.  Particularly important to that revenue, and what Buzzfeed indicates will be the centerpiece of both newly seperate divisions is video. While Buzzfeed is well known for its listicles and quizzes, it is the video that drives traffic and therefore revenue.  

This is not only true for BuzzFeed, but for news outlets all across the web.  

Video is very much the driving force on the Internet and platforms are rushing to take advantage and cash in for themselves.  We have seen this at HuffPost, the Washington Post, and many other outlets.  Video is no longer the afterthought, but the centerpiece.

The tightrope that BuzzFeed now has ahead of it is how to capitalize on the popularity of its video, something that many on the web have been unable to do as well.  

SYDNEY EMBER of The New York Times reports:

Staff meetings at BuzzFeed are not uncommon. Jonah H. Peretti, the site’s founder and chief executive, who is based in Los Angeles, travels to the New York offices regularly and often meets with employees to answer questions or outline strategy.

But two recent meetings took on greater import, after BuzzFeed told employees two weeks ago that it was formally dividing its news and entertainment divisions. The day the reorganization was announced, Ben Smith, the editor in chief, met with the news staff to reassure them that the company was committed to its news operations. And last Wednesday, Mr. Peretti held a question-and-answer session and vowed that the company was not planning to sell its news division.

Staff members at BuzzFeed said the overhaul provoked curiosity rather than deep anxiety. Still, BuzzFeed’s reorganization seemed a transformative moment for a company staking a big bet on the future of video and entertainment.

Already, video represents more than 50 percent of BuzzFeed’s total revenue, compared with 15 percent at the end of 2014. In the next two years, BuzzFeed expects that video will generate up to 75 percent of its advertising revenue, according to a person briefed on the company’s operations.

The move also reflects a broader shift at media companies that are increasingly turning to video and entertainment news to lure a younger generation and attract online advertising dollars. In April, the website Mashable made a round of job cuts as it moved away from covering world and political news, and Mic, a site aimed at a young audience, hopes to have 60 percent of the company focused on video by year’s end.

Traditional news organizations like The New York Times and Tronc, formerly called Tribune Publishing, are investing heavily in video as well.

As video moves from an ancillary pursuit to a more important source of revenue, the shifts in structure and emphasis are causing major changes and some uncertainty in newsrooms. “In any company, especially one that’s going through rapid scale and one that has geographical disbursement, there are disconnects that come up,” said Ze Frank, who until the recent reorganization was president of BuzzFeed Motion Pictures, the company’s video division.Under the new structure, Mr. Smith, who is based in New York, will lead BuzzFeed News, and Mr. Frank, who is based in Los Angeles, will oversee a new division called BuzzFeed Entertainment Group. It no longer made sense, Mr. Peretti said in a memo to employees, for BuzzFeed to have “a single ‘video department.’”

Instead, Mr. Smith’s department will have its own news video team, and Mr. Frank’s division will oversee non-news video, like Tasty food videos, as well as the lists and quizzes that are BuzzFeed’s bread and butter.

“As digital video becomes ubiquitous,” Mr. Peretti wrote in the memo announcing the change, “every major initiative at BuzzFeed around the world will find an expression as video.”

For years, BuzzFeed has been viewed as a digital success story. Its viral content has been the envy of the media industry and its business model, built on so-called native advertising rather than display ads, enticed brands that wanted to reach younger demographics.

It has expanded internationally, with offices in cities including London, São Paulo and Tokyo. Last year, the company received a $200 million investment from NBCUniversal.

But BuzzFeed is facing challenges similar to those faced by both traditional and start-up media companies. In July, BuzzFeed drew 72 million unique visitors in the United States, the lowest number since August 2014, according to the measurement firm comScore. (Mr. Peretti pointed out that comScore’s data did not accurately reflect how many people viewed BuzzFeed’s content across the web and on mobile platforms.)

Read the full article.