More layoffs and other changes at the downsizing United Media p. 39

By: David Astor THE DOWNSIZING OF United Media continued last week with the announcement that about 20 more people are being laid off.
UM, which has reduced its staff by over 20% since last fall, also announced that it will cut its roster of features by 5% to 8%.
In addition, UM is closing its European office (after having given up ownership of its 16-person Canadian division earlier this year) and may be reducing its involvement in the audiotex business. And UM, of course, is selling back the massive "Garfield" property to cartoonist Jim Davis.
Several industry observers interviewed last week wondered if the E.W. Scripps Co. is selling UM "piecemeal" after almost selling it in one big chunk to Time Warner last year.
But UM president and CEO Douglas Stern said all the downsizing has been part of a restructuring effort that now is basically complete. "We're very much in business for the future," he stated.
When asked if he believes Scripps will still own UM in five or 10 years, Stern replied, "I do." He did add that it's hard to predict what will happen with anything in life over that span of time.
Stern also stated that UM is not just cutting back. He said the company will continue to hire new people, introduce new features, and increase its licensing, retailing, and international efforts.
"We just signed a TV deal in Russia for 'Peanuts,' " Stern said, referring to the Charles Schulz property. Also, UM reported that it is starting a new retailing division and expanding licensing activity based on the "Dilbert" comic by Scott Adams.
In addition, Stern said, UM will consider making acquisitions in the future.
So why were 20 more staffers cut on May 5? Stern said one reason for the layoffs, which came after what he described as a "very extensive" three-month review of all syndicate operations, is UM's smaller size. In addition to losing "Garfield," UM no longer owns TV Data (sold in 1992) and Pharos Books (sold in 1993).
Stern remarked that UM now is mainly a syndication and licensing company rather than a "mini-conglomerate."
The latest layoffs were across the board, affecting managers and staffers in such departments as editorial, art, production, licensing and sales. Southeast salesman Mike Pearson and Southwest salesman Tom Counce were among those losing their jobs, which means that UM now has four fewer field reps than it did in 1993. Four field reps remain, including one who mostly sells Scripps Howard News Service.
One UM comic cartoonist requesting anonymity expressed concern about this reduction. "For years the syndicate has had a powerful road sales force to get comics in the newspapers," he said. "It's the department that most contributes to our success."
Stern said the sales department has been restructured and now will be "stronger." He and UM senior vice president, general manager of syndication Sid Goldberg reported that UM will expand the territories of the remaining road reps, use more telemarketing, have different people concentrate on larger and smaller papers, change the way accounts are managed, and more.
Goldberg added that fax machines, computers and other new technologies have made it less important for syndicates to have large sales forces driving around the country.
Messages were left on Pearson's and Counce's answering machines, but they could not be reached for comment.
One of the laid-off people from a department other than sales expressed anger at UM's latest workforce reductions. The former staffer, who requested anonymity, said UM did not have to let so many people go because "it has been profitable for years."
Stern responded, "United Media is a very profitable company but over the years has not been building profitability."
Another former UM staffer said, "There are a lot of good people getting caught in this. Their lives are being turned upside down."
One syndicate executive reported that several laid-off UM staffers called him last week seeking jobs, but he couldn't offer any. He noted that the callers expressed "hurt" and "anger" about losing their UM positions.
Stern said laying off people was "the most difficult thing I've done this year," and added that no more layoffs are planned. He emphasized that the 20 staffers were offered "generous" severance packages, but declined to discuss details.
A number of the departing staffers were longtime employees, meaning UM is jettisoning a number of higher salaries. Is UM worried about the loss of all this syndication experience and institutional memory?
Goldberg responded that he and a number of other longtime employees still remain at UM.
What about a replacement for UM executive Sarah Gillespie? Goldberg said Gillespie, who is stepping down this month as vice president and director of comic art, will continue to work part time for UM as acquisitions editor and "Peanuts" editor.
Also, Amy Lago has been promoted from associate editor to managing editor for comics, according to UM director of public relations and creative services Nancy Nicolelis. She added that Pat Redding, another associate editor in the comics art department, has been promoted to special projects editor.
Speaking of comics, sources said they heard rumors that UM may ask cartoonists to pay more of their expenses. Stern said this is not true.
Comics will be among the features dropped when UM makes the 5% to 8% reduction in its roster of about 150 properties. Goldberg declined to name the features, but did note that a number of them are older and none have significant client lists.
"Every syndicate drops features from time to time," he said. "We're doing several at once."
It also is possible that some creators may leave UM on their own volition if and when their contracts allow it. One syndicate executive reported that two UM creators recently asked him about switching to his company because of their uncertainty about UM's future.
But a Pulitzer Prize-winning editorial cartoonist who switched this winter from another syndicate to UM expressed optimism about UM's future.
"I'm happy to be on board," Steve Benson commented. "I believe United is positioning itself to become more competitive and more aggressive."
The Arizona Republic staffer added that when he was deciding whether or not to join UM, Stern told him additional changes were coming at the company.
"I don't see this as something surprising," he said. "I was aware that there was going to be some significant restructuring, but I got the clear impression that they remained completely committed to the enterprise. They wanted to do some streamlining and tightening up. Given the economy and the nature of the newspaper business, one would expect to see some course corrections to make United a better organization."
But the anonymous comic cartoonist said that no matter what UM does, the loss of "Garfield" has to hurt the company. He acknowledged that UM is receiving a huge sum of money for the property ? estimates range from $15 million to $40 million ? but added that UM will no longer have the yearly "Garfield" income. He also wondered whether Scripps will keep the "Garfield" money or reinvest it in UM.
There are reports that UM also is selling back part of the rights to the "Fido Dido" licensing property to its creators. Is this, along with the selling of "Garfield," the shape of things to come at UM?
No, said Stern, who described these as "isolated" developments that do not signify a trend to sell off more UM features.
Stern declined to comment about reports that UM may be trying to reduce its involvement in audiotex. Two sources said UM was in negotiations that might lead to Zimmers Voice Publishing taking more control over the "Personally Speaking" service, which combines print personal ads with a 900-number system. Zimmers has been the service bureau since UM began offering "Personally Speaking" to newspapers in 1991.
As for the seven-person European office in Amsterdam, Stern said it was closed to "eliminate another layer" at UM. He added that all international operations now will be handled out of the company's New York City headquarters.
There may be one more change coming at UM. With a smaller staff and a lease due to expire in 10 months, Stern reported that UM is considering a move to different office space in Manhattan.
?( Douglas Stern) [Photo]


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