5 things to know about Univision’s $135m bid for Gawker
It’s confirmed: Univision is the winning bidder for Gawker Media. The largest Spanish-language broadcaster is paying $135 million for the 14-year-old blog network, which co-founder Nick Denton was forced to put up for sale after it went bankrupt fighting a lawsuit against Hulk Hogan (legal name: Terry Bollea). Ziff Davis was the only other bidder. Denton will be leaving the company and its controversial flagship Gawker.com will be shutting down. Here are five things to know about Univision and what the Gawker acquisition means for it.
Univision is trying to diversify
Univision has been trying to expand its reach beyond its Hispanic audience, and adding Gawker Media fits in with that strategy. Earlier this year, Univision took full control of Fusion, the web and cable network it had co-launched with Disney. After starting with a Hispanic-targeted strategy, Fusion decided to go after millennials writ large. Univision’s portfolio also includes satirical news site The Onion, in which it took a 40 percent stake earlier this year; and black-interest site The Root, which it acquired last year.
New revenue streams are a draw
Publishers have found branded content and e-commerce revenue hard to crack. Gawker has an established native ad and e-commerce business that together add up to about one third of its revenue, which would have made it a draw to Univision. Fusion has only lately built a branded content unit, while the Onion has scaled back its work in this area in part because of competition (also there’s a limit to the number of advertisers that are comfortable being associated with ads in the Onion’s satirical voice).
Univision needs scale
Media outlets that want to reach millennials can’t afford not to distribute their content widely. Bonus: It helps to have a direct audience that they can fully monetize. Univision’s sites are small, though Fusion’s traffic has more than doubled in the past year, to 11.5 million uniques in July. It has gotten some attention for investigative coverage, but it’s still puny by internet standards, which Gawker itself has mocked it for (see article titled: “More People Work at Fusion Than Are Reading Its Most Popular Post.” Awkward!) Gawker Media will contribute more than 50 million monthly uniques across all seven of its verticals, including the soon-to-be defunct Gawker. Just over half of its audience (52.4 percent) is 18-34, the age group advertisers obsess over.
It knows from distribution
Univision recognizes if it wants to reach young people, it has to meet them where they are. Last year, it built a multi-channel network for YouTube stars, Vine “influencers” and other video personalities, extending the work of its online video site Flama. It has a partnership with Snapchat that involves creating live stories around Univision events, live sports and the election; and a new Discover channel that the Onion launched earlier this year. As for Fusion, it created a 12-person social news team, and has even experimented with delivering news on messenger bots. Gawker has done little in the way of video production, but Univision could provide the shot in the arm Gawker needs to create more video to live on different social platforms, as it’s done with the Onion and The Root.
“We could not have picked an acquirer more devoted to vibrant journalism,” Denton wrote in a statement when the deal was announced. Last year, before the Hogan trial, Denton estimated his company to be worth something in the $250 million to $300 million range.
As far as cultural fit, a risk is that Gawker could become neglected as a small fish in a big pond, and Gawker might have had a more spiritual home in another publishing company known for hard-hitting journalism, such as New York Media, which was considered a likely bidder. Univision seems to be a better home for Gawker than other interested parties like LittleThings or Ziff Davis, though, whose interest would have been limited to Gawker’s lifestyle or tech-focused verticals.
Will Gawker have to find something nice to say about Fusion now? Maybe it doesn’t matter, now that Gawker is ceasing operations.
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