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Online Media Companies Heading Nowhere, Chasing Cash

Online Media Companies Heading Nowhere, Chasing Cash

oOh! Media still has the up for sale sign up at Junkee Media where sales slumped last year to just $4.1M a decrease on the prior 2020 year. The sale comes as BuzzFeed also looks for a financial rescue.

ASX-listed billboard advertising company oOh! Media paid $11.1 million for 85% of the Junkee business, before buying the remaining 15 per cent several years later.

Questions are now being asked as to who will buy a niche online operation that is struggling to reach an audience that gets news from Tik Toc Instagram & and Facebook today.

The demise of niche sites has seen investors pull 94 percent of their money out of BuzzFeed another niche online publishing site that is struggling to find an audience.

Last year tech web site CNet was sold by Viacom CBS for a cut down price of $500M to Red Ventures. CBS acquired CNET Networks in 2008 for $1.8 billion. The Australian operation which struggled to generate revenue was closed down.

BuzzFeed claims that they will press on with plans to build an online media company despite the exodus of nearly all investors from its Spac fund as it prepares to go public.

BuzzFeed founder Jonah Peretti told the FT. “Digital media still has a little bit of a hangover from the bursting of the hype five years ago”.

Self promotion and influencer media struggling as fringe online sites struggle to sell.

Niche media sites are struggling, Roma Christian who worked at 4Square Media left to set up her own media Company Aestology, the site has little traffic limited if any advertisers, and many of the stories are old, also missing is any sense of direction with advertisers getting tired of self-promotion by people and web sites that are desperately clinging to an audience that is going back to main stream media.

Media companies including Nine Entertainment and Seven West Media have experienced a major bounce back in advertising spend as the economy recovers from COVID-19.

Peretti created BuzzFeed 15 years ago as a laboratory to see what kind of content would become popular on the internet.

The website grew quickly, winning over younger audiences with stunt videos, such as exploding a watermelon with rubber bands, and viral posts like “The Dress.”

In Australia, the online media sector has struggled financially, site like Junkee, Aestology and BuzzFeed are not seen as mainstream, and a lot of their journalism is based on press releases of self-promotion stunts claims observers.

oOh! Media announced the sale of Junkee, which also runs publications Punkee and AWOL, in July, several interested buyers such as Rolling Stone publisher Brag Media and The Latch publisher Val Morgan withdrew after looking at the books

According to Nine Media site SMH industry sources, who spoke on the condition of anonymity, said several outlets, including the UK-owned Guardian, remain in talks to buy the company.

There was also speculation that Mamamia, the website owned by Mia Freedom and her husband Jason Lavigne may also be in the mix. oOh! Media declined to comment.

The sources suggest a transaction could be done before the end of the year if oOh! Media and its advisor Jacanda Capital are willing to compromise on price.

oOh! Media wanted the deal done by October 29.

The Australian Financial Review said last month oOh! Media was expecting $20 million for the publication which some claim is “wishful thinking”.

The content marketing studio which does make money is not included in the sale.