Yesterday Ziff Davis Media Inc. filed Chapter 11 petitions with the U.S. Bankruptcy Court for the Southern District of New York. The move was the first stage in a major restructuring for the company, as it has failed to deal with declining revenue from its print media subscriptions and associated advertising.
Ziff Davis manages to reach 26 million individuals by way of 16 websites, including 1UP.com and FileFront.com, and three magazines–PC Magazine, Electronic Gaming Monthly (EGM), and Games for Windows: The Official Magazine.
Before going into bankruptcy, Ziff Davies created a pre-arranged plan for re-organization of the company. That plan will now come into effect with the approval of the Courts, and the company is hoping to come back out on bankruptcy by the summer.
Under the terms of the pre-arranged deal, the US$225 million owed to creditors will be replaced with a $57.5 million debt to those same creditors. On top of that, 88.8% of the restructured company will be shared between them. What happens to the remaining 11.2% is up in the air, but it’s likely it will be offered to other creditors not covered under the first offer.
According to Jason Young, chief executive of Ziff Davis, the focus is now turning to business online for the company.
Read more at the Associated Press article and the Ziff Davis press release.
Matthew’s Opinion
Print media has certainly been in decline for a number of reasons; two of which are prominent. The first is obviously the growing popularity of the Internet as a source of information. You can’t beat its immediacy, and there is such a huge range of information to be found that magazines can look really dated.
The other factor is cost. The cost of producing magazines has risen significantly over the past few years, and therefore people are less likely to buy a magazine. Subscriptions offer discounts and/or free items, but this isn’t that much of an incentive unless it is a really useful offer.
I’m sure Ziff Davis will bounce back, and I’d hate to see EGM magazine disappear off the shelves.
MPIO’s many PMPs may not always turn heads, but it looks like the company has done alright for itself with its new V10 player, which boasts a 3-inch WQVGA touch screen display and some all around decent specs. That includes 8GB of storage (with an SD card slot for expansion), an FM tuner, TV output, and support for just about every audio and video format you could ask for, with Windows CE 5.0 serving as the basis for it all. No word on pricing or availability just yet, but you can catch a glimpse of it in video form by hitting up the link below.
