Upday is one of the international success stories of German media group Axel Springer. In cooperation with tech giant Samsung, the news aggregator has expanded into 34 markets in recent years. Now, a large part of the staff has to go. It is the second job cut in a short time.
Global job cuts: One in three employees has to go
► 51 of the roughly 150 employees worldwide are affected. This is around one third of the workforce. Layoffs are being made across all departments. In Germany, Upday’s largest hub, the most employees will go, with 30. The editorial team will also shrink dramatically at all locations from around ten jobs to three to four.
► At the end of last year, Upday’s workforce still numbered around 200 people. This means that half of the employees have now been laid off within half a year.
► CEO Thomas Hirsch informed employees of the measures last week in a memo obtained by Medieninsider.com, saying, „it has become necessary for us to undergo some changes to maintain our competitive edge and overall health as an organization.“ And, „It’s crucial to note that this reorganization is a response to evolving market circumstances, not a reflection of the quality of our products or performance.“
► The reason for the job cuts: Upday’s overall advertisement sales have slumped. The advertising business is by far the largest revenue pillar of the news aggregator.
► Affected employees received another mailing after the memo, according to which they were immediately released. An exception applies to employees in France and Sweden, who will be addressed personally.
► Management personnel are also affected by the job cuts. Germany‘s editorial director Hans Evert has been let go, and current editor Lena Zimmermann is to take over . Cross-country editor-in-chief Henrik Lundvall (Upday Scandinavia) is also said to have been let go. He took over international coordination from his Polish colleague Michal Wodzinski only at the turn of the year. A spokesperson for Springer said: „The job cuts affect all areas and all locations. We do not comment on specific personnel.“
► As part of the restructuring, Upday will close offices in individual markets, but plans to maintain operations everywhere. Employees are to work remotely, different hubs could be merged. Still open is the question of what role artificial intelligence might play in curation in the future.
► Axel Springer tells Medieninsider: „The media and technology industry has been under considerable pressure for more than a year. The economic headwinds that many of our customers and partners are facing are also impacting Upday.“ And: „In addition, we have largely exhausted the growth potential in our existing markets and the overall market environment has become very competitive.“
The extensive job cuts are also a bitter setback for one of the Axel Springer Group’s digital success stories.
► The Group had launched the news aggregator in spring 2016 in cooperation with Samsung. Because it was preinstalled on the manufacturer’s new smartphones, the app spread rapidly.
► After initially being available in Germany, France, Poland and the UK, the app expanded to 30 other markets. According to the company, Upday is available in 26 languages and reaches 25 million monthly users.
► When the exclusive partnership with Samsung expired, Upday launched an iOS version for Apple devices in 2021. Nevertheless, growth has become difficult recently.
► This year, Samsung launched its own news app, Samsung News, rolling it out initially in the US. I’s content is curated by Upday, though.
► Further the business as a service provider shows itself to be difficult. In Germany, Upday lost a contract to curate Facebook News in 2022 after a dispute broke out among German publishers. In other markets (Upday also curates for Facebook in the UK), the situation is likely to be made more difficult by the fact that Facebook has down-prioritized news content.
► It is not yet known how things will continue at Upday after the job cuts and what will develop in the aggregator product or, for example, in the podcast segment. CEO Hirsch sets the mood for more difficult times in his memo:
“It is a testing time for all of us, and as we navigate this transition, we anticipate there may be moments of discomfort, affecting both those who are departing and those who will continue with us.”
This text was translated by Deepl from German into English and slightly edited
