Penton Media and Reed Business Information are the two latest b-to-b media companies to implement major reorganizations. Both companies announced the moves in January, and RBI went a step further with a round of deep job cuts.
Industry observers said the moves were made to better focus the businesses, trim costs in the recession and make both companies more attractive to potential buyers.
Roland DeSilva, co-managing partner at media investment bank DeSilva & Phillips, applauded both restructurings. “They're looking at their strategies and moving toward digital media. They're trying to mine the wealth of information that each company has and focus the companies more on being information companies than on the print media model.”
Ed Fitzelle, managing director of media investment bank Whitestone Communications, said: “They need to find a way to start thinking about doing divestments, and they need to make sure they're on top of their markets.
“Penton is owned by a private equity player. They need to start paring down the portfolio and putting cash into the business. For Reed, the same sort of thing also applies for when they go back on the market.”
Reed said in a statement that it “reduced its work force by 7% in response to the impact tough economic conditions are having on its business. In addition, salary increases and hiring were frozen for the year.”
In tandem with the job cuts, Reed reorganized its operations into four divisions:
? The Business Media division, which includes Broadcasting & Cable
is headed by Jeff DeBalko, who has been named president of Business Media.
? The Construction Division, which includes Construction Equipment
and HousingZone.com, is headed by Reed Construction Data CEO Iain Melville.
? BuyerZone, which is headed by Mie-Yun Lee, president of the unit.
? The Entertainment Division, which is headed by Variety
President-publisher Neil Stiles.
Reed said that Jeff Greisch, president of the company's Chicago division, is leaving the company at the end of the quarter.
Penton's reorganization created 13 market-focused groups that fall under five larger umbrella divisions. The divisions include all media products devoted to the segment: magazines, Web sites, events, directories and data products.
“This will organize Penton logically for our customers (content users, advertisers and attendees), employees and partners,” Penton CEO Sharon Rowlands said in a statement.
Penton's five new umbrella divisions are:
? The industry group, which includes Design Engineering
and is headed by Senior VP Bob MacArthur.
? The agriculture, food and marketing group, which includes Supermarket News
and is headed by Senior VP Dan Bagan.
? The lifestyle group, which includes the Natural Products Expo trade shows and is headed by Senior VP Fred Linder.
? The technology group, which includes Windows ITPro
and is headed by Senior VP Kim Paulsen.
? The financial services group, which includes Registered Rep
and is headed by Warren Bimblick, senior VP-strategy and business development. Bimblick will also lead business development, focusing on strategy, audience development, custom solutions, acquisitions and communications across the company.
Fitzelle, noting that Rowlands was formerly an executive at Thomson Financial, said Penton's reorganization was designed to deliver results. “I think she's coming from an environment where it's get results or get out. She's really looking at bringing that kind of outlook to Penton.”
A key part of the reorganization was moving Penton's Internet division into each of the groups. “There is no cross-operational imperative greater than our digital strategy,” Rowlands said. The company said that digital capabilities will move directly into the market segments.
As a result of these moves, Shawn Etheridge, senior VP, and Jim L'Heureux, senior VP-digital, are leaving Penton. M