Republic turned out to be in financial crisis

Journalists are transferred to a new "efficiency system".
16.08.2018
Ouartz Media
Origin source
At the disposal of "Medusa" was a letter from Alexander Vinokurov, an investor and general director of the online publication Republic (part of a holding company with the television channel Dozhd) to the editorial board. It was posted on July 27. In the letter Vinokurov writes about the "financial crisis in the publication". "Significant amounts of arrears have been accumulated in respect of the authors' fees and insurance premiums to extra-budgetary funds," Vinokurov said. "This threatens us with sanctions, which, most likely, will lead to a halt to the economic activities of our company, which I would not like to admit."

In the letter, Vinokurov suggested that the company's executives and editorial staff (chief editor, two of his deputies and the chief accountant) agree on August 1 to cut salaries to 60,000 rubles a month. At the same time, the chief editor and deputies were promised a prize "for the performance of key indicators." As Vinokurov promised, the editors' income as a result will not decrease by more than 20%.

Writing journalists will measure effectiveness and pay royalties to them. Two editors resigned. Republic is one of the three Internet media in Russia, which sells most of its content by subscription (except for it is Vedomosti and the TV channel Dozhd). On this model, the edition was transferred in the summer of 2014; now the subscription costs 4800 rubles per year (excluding shares and discounts).

According to the publication itself, it managed to reach the level of 20 thousand concurrent subscriptions as early as in early 2016, after which sales stabilized. Subscriptions allowed to generate revenue of 4.5 million rubles a month.

As Josef Furman, who worked in the Republic as editor-in-chief and engaged in subscriptions in particular, told Medusa that in May 2018 there was a slight decline in sales, but then the shares passed, and the number of subscriptions returned to the usual level. Shares usually meant sales at a discount - they could be up to half the cost of a subscription.

Furman himself, on the eve of the announcement of the crisis, met with Vinokurov and preferred to resign - he was "offered another functional" of the work, with which he did not agree. According to Fuhrmann, by that time all employees engaged in the production of content had been detained in June and July of the salary part, which, according to the contract, was registered as a bonus.

"When hiring with all agreed salary, which was formalized as a salary plus a bonus, in proportion of about 60 to 40%. No one perceived these 40% as a bonus, no KPI (key performance indicators - "Medusa" note) was prescribed for its receipt, "the journalist says. - Simply [in the personnel department] they said that it is necessary to do so to simplify the work. "

According to one of the Republic employees who asked not to be named, "when Vinokurov was told that it was unfair to change the conditions offered by the employer from the very beginning," he was sent to an employment contract where it says that the award is issued not simply, but "for high qualification and achievements in labor, personal contribution to the results of the economic activities of the employer ". On August 1, the personnel department, which, as Vinokurov told employees, could "mislead them," was reduced in the edition.

With a fall in his own salary, the deputy editor-in-chief Roman Fedoseyev almost doubled. As he told "Medusa", after that Vinokurov forced him to quit, - however, the journalist says, the parties "dispersed without mutual claims": Fedoseev was paid the shortfall "premiums" and "small compensation".

According to Fedoseyev, he was not satisfied with not only lowering the salary, but also the proposed scheme for assessing the effectiveness of employees - according to the number of subscribers who read each article to the end. "That is, the success of the text in the outside world - scratches, views, [subscription] [from the page of this text] - all this has lost importance. The system of effectiveness was not liked by anyone in the editorial office, except [the editor-in-chief of the Republic Maxim] Kashulinsky, "Fedoseev explains. Kashulinsky in a conversation with "Medusa" said that nine out of ten employees of the publication who agreed to create content agreed to the system as a result.

Vinokurov told Medusa that he was going to present a new type of contract to the freelance writers of Republic. "If the authors want, they will be able to use the proposal: it will be similar to the one used in book publishing - [this is a scheme] of royalties," he explained. How they will be calculated, the Republic investor did not specify.

The editor-in-chief explains the crisis by saying that the publication went "in the wrong direction" Vinokurov and Kashulinsky do not tell the details of the "financial crisis" in the Republic. Vinokurov told Medusa that now the financial situation of the publication is "normal": the debts to the freelance writers have been paid, there has been a "small delay in fulfilling the obligations to the lessor and social contributions, but by the end of the month we will fix it all."

Alexander Vinokurov additionally commented on the crisis in the publication in an interview with Medusa, saying that it is largely related to the unskilled work of some employees. "Approximately at the end of 2017, we recruited several new employees with large salaries," the owner of the newspaper says. - We expected that this will help to produce more quality content for subscribers, will help significantly increase revenue from subscriptions. The effectiveness and qualifications of these employees turned out to be significantly lower than those announced for hiring. We were wrong. The error affected the financial result - expenses increased, and there was no return. For example, revenue (not profit) from the sale of subscriptions in Facebook for a month was half the salary of a specialist who did it. Now we are correcting mistakes. "

The reduction in expenses affected not only the salaries of full-time employees. Since August 1, the editors have moved to another office with a lower rent. In addition, according to Furman, since the spring of 2018, other expenses have also been reduced, for example, for advertising in social media. "Vinokurov himself was engaged in [promotion to] Facebook, which surprised me," says Furman. - Huge money was paid for [buying] traffic on social networks, but traffic was poorly converted into subscriptions. We set up metrics and saw that you can spend less and less efficiently and be more efficient at times. "

Kashulinsky says that since the transition to a subscription model of foreign investment and loans in the Republic almost was not - the publication could pay for itself (advertising was one of the sources of income - but, as Kashulinsky says, "advertising and subscriptions do not get along well; need coverage "). "Republic is one big experiment," the editor-in-chief adds. - We receive money from subscriptions, when they become a little more, we expand; sometimes we go in the wrong direction - we have to shrink. "

Kashulinsky is still confident that "the subscription model is the future of high-quality media." Reforms and a decrease in his own salary do not bother him. "There is a premium part," he says. "I am satisfied with the conditions."

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