CNET Board Has “Tense, Uncomfortable” Meeting With Jana Consortium
Michael Arrington
26 comments »
Last Thursday, March 6, multiple sources say, the CNET board of directors and CEO Neil Ashe met with representative from the Jana Partners investor consortium that has amassed a 21% ownership stake in the troubled company. The goal of the meeting was to negotiate a settlement that would avoid a proxy fight and a potential hostile takeover attempt.
Jana Partners’ founder Barry Rosenstein was the lead representative from the consortium’s side, which also includes investments from Sandell Asset Management, Spark Capital, and entrepreneur Paul Gardi.
From what we hear the meeting didn’t go so well. “It was tense and uncomfortable,” said one source. The CNET board “is in a state of denial” about the seriousness of the situation, said another. The consortium wants the company to focus on technology, including an overhaul of the dated CNET content management system and ad serving platform. The CNET board instead wants to “aggressively expand” their business internationally and focus less on infrastructure improvements.
For now the two groups are mostly talking about high level company strategy. But at some point the consortium, which is the largest CNET stockholder, will want a significant board presence. That might mean as many as 3-4 board seats out of the 8 that exist now.
CNET stock continues to slump - it’s worth about half as much as it was two years ago. The company has recently made a few high profile management changes (all for the better, in my opinion) and has sold off assets. But deeper changes are clearly needed.
Expand internationally is definitely the way to go!
I have to chuckle at the inclusion of Paul Gardi in all of this. Does anyone know Paul? He really killed it at Ask.com:)
“CNET stock continues to slump - it’s worth about half as much as it was two years ago..”
And (Our HO) it will continue a downward path until they catch up a little bit, clean up their bloggers mistakes and grab some new content..
The Team
http://iserviceshop.blogspot.com
CNET Networks is fast! I like it!oh…
mike, you sure do hate on cnet and it reflects poorly.
Timing is everything as they say.
You keep this stuff in queue just in case?
I assume you guys are talking about my twitter criticisms of the CNET/Sarah Lacy drive by? These are unrelated. CNET just bugs me sometimes. Their writers seem to want NYTimes type respect but resort to valleywag type articles to get page views. Can’t have it both ways. Or maybe they can. Everyone seems to think its fun. Except Sarah.
un.valley - that’s because I’ve been around long enough to remember when CNET was so great, a must read every day. Now it’s like an accident scene.
I’m not familiar with their current problems, but I feel CNET is fixable. But in terms of the stock market, now is not a good time to be a company like CNET (or any company with exposure to the US consumer).
WTF? first, go check techmeme - there are lots of others taking even harder shots at sara lacy for that interview. .
as far as your obsession with cnet, get over it, dude. it reflects badly
yes, the witch burning has drawn quite a crowd.
I have to agree with Jana Partners on this. I’ve been thinking CNET Networks needs to regroup, focus on what they do best and that’s providing tech news & reviews, software downloads and resources for IT professionals. They can expand by purchasing large tech blogs and other news sites (such as the InternetNews.com and EarthWeb.com properties from Jupitermediap; SourceForge Inc.; TechTarget Inc.; or the assets of bankrupt Ziff Davis Media Inc.) but should immediately sell their non-core assets, such as TV.com, mp3.com, Search.com, to raise capital for the acquisitions as well as a revamping of their infrastructure. Their content management system is outdated and the Jive Software they use for forums and blogs is horrible.
Cheers,
Doug
CNET s****. There are hundreds of irreleveant of links on every page, multitude of flashing banners, comment system from hell. They provide the same news as other IT news outlets. What’s their USP? I think there is no fixing this monster. It’ll ultimately join the deadpool after selling the domain names it owns.
Just curious to hear from people what precisely is outdated about the CNET CMS. Choosing a CMS is something I assume 90% of TechCrunch readers face at least once, if not multiple times, in their careers so it would be interesting to hear how CNET is limited by their CMS.
I actually tend to side with the “consortium” here. What’s wrong with focusing on international business…. and growing the brand? A lot of people still do not know who they are.
BTW what does “CNET” stand for? Not a very consumer freindly name (I am sure I could Wikipedia it and find out).
They have the Crave blog (among others), lots of odd Podcasts and content. I am not sure they know who they even are. Some of their blog posts are pretty unprofessional, and I do agree that they demand NY Times type respect, but dig up dirt for easy pageviews.
But still….with Ziff Davis filing for bankruptcy, Cnet is the only large place for good reviews and tech news. There is no reason to blacklist them. I hope they are able to work things out.
What kind of board recommends overhauling a CMS and ad serving platform? That’s kinda odd.
I completely agree with the Jana folks as well. (And Doug up there - good ideas!) The board’s current plan sounds like “If we just do as much of the same as possible in as many places as possible, it will all work out.” That doesn’t make any sense.
Also, I’ve had to spend a lot of time on download.com recently (reason why? Kind of like comparing download sites for my job; long story), and it is by far the least user-friendly. It’s like someone decided that having actual content was a conflict of interest with their advertising, so they try to push the content out of the way as much as possible so they can fill every page with ads. God forbid I’d actually want to use the site (which I do not do under normal circumstances unless someone links to a specific article).
Err, just noticed a mistake. I meant to say that I agree with the Cnet board about focusing on building the business internationally.
Revamping the CMS, and ad server will not help create immediate results or revenue, and takes time to redo.
Dumb dumb dumb. CNET clearly know how to publish online. If their systems need updating, well that’s something all online businesses need to do every few years but no reason for a change of board.
As for getting rid of TV.com - madness - that is growing fast and making money faster. MP3.com is a dead duck and should either be binned or reworked to offer something new.
CNET’s fault is their size makes for a lack of nimbleness, and there is uncertainty due to lots of people leaving in the past. They have a great management team now, they should balance the workforce and get them focused.
As for the reputations of some of the members of the consortium. I know more than most, and I wouldn’t give any of them a board role.
CNET clearly know how to publish online. You are right “90’s dotcommer”.
Thanks for the information…
As a CNET employee, I have to say that comment #19 is right on. Nobody else gets it, including Arrington.
i stopped reading news.com once i found techcrunch.com
i never analysed why.. . i guess it just seemed logical for me to move on….
maybe i loved reading/finding/experiencing innovation and stopped finding much of that in news.com as much as i found in techcrunch.
no criticisms but just stating what i experienced…
i and many others want to experience and be a “fan”… thats what every product /service should try (my opinion)…and “make enough fans”.
cnet maybe could try to figure out why their “old fans” are moving on…. (rather than going internationally)..
or they may want to read seth godin first …. concentrate on your core competitencies and improve on them…you just need “enough fans” than more user bases…
((recommeding seth godin, cause i have become a fan of him….link here: http://sethgodin.typepad.com/seths_blog/ ))
and bla bla bla
enjoy,
Ujw