For all the things the lengthy and often controversial process of the UK leaving the European Union (EU) has been blamed for, this one might be a first – a digital publishing giant says it’s Brexit that’s behind a significant downturn in its business.
Namely, Vice’s UK operation is pointing the finger at Brexit for the massive losses in that country, Press Gazette reports.
The media trade magazine writes that the American publishing brand catering to and targeting millennials has seen pre-tax loses in the UK increase by 75 percent in 2018, to reach £3.9 million.
Vice UK’s business includes not only the publisher’s own websites but also third-party partners distributing its content and selling ads. And this business is suffering with revenues down to £17.3 million in 2018 from £25.7 million the year before, according to the report.
The question then naturally becomes why – and the struggling publisher’s global senior advisor Matthew Elek, previously in charge of Europe, Middle East, and Africa during the times these losses accumulated – said that Vice sustained most financial damage in the European Union, “due to the uncertainty surrounding Brexit negotiations.”
The decrease in revenues happened in the digital and production sectors, Elek also reveals, adding that the drop was sharp – from £10.5 million in 2017 to £4.7 million in 2018, in this market.
But neither Elek nor the report go into how UK’s nearly 4-year negotiations and internal political crises linked to the process of leaving EU membership managed to reflect poorly on Vice UK’s business – much less so as allegedly “the driving factor” behind the significant decline.
Regardless of the business performance, it seems that the US-based parent company will continue to prop up Vice UK financially for at least another year.
However, jobs are being lost along with revenues, with Vice UK employing 186 people in 2018, down from 193 – and all this happening before Vice Media announcing in February 2019 it would cut its workforce by ten percent globally, including in the UK.
Vice is also looking for other ways to salvage its business, by making changes and mergers both content and administration-wise. All in all, it would seem the so-called “new media” continue to struggle in the digital era just like traditional publishers,