Business Insider is slashing 21% of its staff as it focuses on “fully embracing AI” and reducing its reliance on “traffic-sensitive businesses.”
In what could be a sinister precursor to similar actions by cash-strapped publishers, the news site strongly indicated it intends to rely more on generative artificial intelligence (AI) for search traffic and beef up its live events business. Earlier this month, the organization hired a newsroom AI lead. (On Thursday, the New York Times Co. said it agreed to license its editorial content to Amazon.com Inc. for use on its AI platforms under a multiyear deal. It is the Times’ first licensing arrangement with a focus on GenAI.)
“In the past year, we’ve launched multiple AI-driven products to better serve our audience — from GenAI onsite search to our AI-powered paywall — with new products set to launch in the coming months,” Business Insider CEO Barbara Peng said in a memo to staff on Thursday. Business Insider is also “exploring how AI can boost operations across shared services, helping us scale and operate more efficiently,” she wrote.
“Over 70% of Business Insider employees are already using Enterprise ChatGPT regularly (our goal is 100%), and we’re building prompt libraries and sharing everyday use cases that help us work faster, smarter, and better,” Peng said in a memo to staff.
“We’re at the start of a major shift in how people find and consume information, which is driving ongoing volatility in traffic and distribution for all publishers. The impact on our industry has been profound, with many publications shuttering in recent years,” Peng said in the memo.
“Our business is diversified, which has helped insulate us. We’ve also significantly improved how we monetize traffic — each visit to our site now generates twice as much revenue as it did just two years ago,” she wrote. “Still, 70% of our business has some degree of traffic sensitivity. We must be structured to endure extreme traffic drops outside of our control, so we’re reducing our overall company to a size where we can absorb that volatility.”
The Insider Union and the NewsGuild of New York issued a joint statement condemning BI management and its parent company, Axel Springer.
“Shockingly, in the same email announcing the layoffs, management also says it’s ‘going all-in on AI,’ patting themselves on the back about AI use in our newsroom,” the statement said. “To say this was tone-deaf to include in an email on layoffs would be an understatement.”
Steve Hirsch, CEO of strategic communications firm Hirsch Leatherwood, expects more of the same — and soon. “This trend will continue and the power of media awareness and influence will increasingly live on new media (podcasts, substacks) but it’s not the end of journalism either,” he said in an email. “The AI slop we’ve become familiar with will actually make legacy publications (New York Times, Wall Street Journal, Bloomberg) more influential and still require a lot of sophisticated journalists if they’re trusted to be the source of human-generated content vs. the entire rest of the internet.”
In January 2024, Business Insider trimmed 8% of its employees, after reducing its workforce by 10% in April 2023.
Added Scott Samson, CEO of SamsonPR: “Newsrooms are shrinking but content isn’t. As more media outlets downsize and turn to AI for content creation or to make newsrooms more efficient, the industry is undeniably shifting. The traditional newsroom model is evolving, fast.”
