[UPDATED] Hibu closes its hyperlocal print magazine unit and lays off hundreds of journalists

In 2012, the company that owned Yellow Pages Yellowbook changed its name to Hibu and retooled its operations. It started a community magazine unit and it grew fast – from 10 titles in fall of 2012 to more than 600 in 20 states by December of 2013. Nearly 200 journalists worked for the operation. (I don’t have a part-time vs. full-time breakdown.)

“The company hired dozens of Patch editors for this start-up effort,” an ex-employee tells me. “They tried to use an existing [Yellow Pages] sales force to sell ads to replace lost revenue from telephone directories that are no longer relevant.”
Another says: “The company’s goal was to have community magazines around the country, sticking with a hyperlocal news focus. …Readership studies [said] that people are interested in print products with an extremely local focus — my street, my school, my friends and neighbors.”

The 32-page full-color magazines were free and mailed to 5,000 of the highest income homes in each community.

Hibu hired mostly former newspaper people and Patch refugees to run the magazine operation — people like Maria Archangelo, a former editor at the Baltimore Sun, Rutland Herald and other publications; Susan Koomar, a former Patch regional editor and Times Shamrock Newspapers staffer; and ex-Keene Sentinel executive editor Tom Kearney, who got the title of senior manager for global editorial quality.

One of the Hibu magazines

One of the Hibu magazines

In early March, when Hibu hired a new CEO, the company’s journalists started getting nervous. One had a friend forward a message to me on March 6 — I was told “they’re afraid of getting caught talking to you” — that said in part: “Our fear is that the plug is about to be pulled on this project, and we want to fight a small rear-guard action.”

If there was any fight, it was unsuccessful.

On Monday, the Hibu community magazines division was closed and employees were fired in a 3 p.m. ET conference call led by Hibu product portfolio veep and former Patch regional director Ryan Cantor.

Email accounts and cell phones would be shut off immediately, Cantor said, and employees would get one month’s severance pay. Update: Journalists at the the main offices in King of Prussia, Pa., are scheduled to work until mid-May on the final two issues. Editors in the field were laid off on Monday. I’m told that 311 people were laid off, including editors, paginators, designers and support staff.

The company released this statement: “To protect the future of the digital business at a time of continuing decline in our directories’ revenue, we have initiated a program of cost efficienies and savings across the company.”

Hibu will now focus on the “still large and important print directory business,” as well as websites and digital directories, according to an email to employees.

I phoned Hibu to get exact layoff numbers and was told someone will call back. Update 2 — Hibu spokesman Andrew Spybey writes in an email: “Re your request for exact layoff numbers, I’m afraid we are not disclosing that detail, aside from via notices where necessary in compliance with the Worker Adjustment and Retraining Notification (WARN) Act.”

* CEO: No clear path to sustainable profitability with Hibu magazines (timesherald.com)