Deepgroup Closes, Some Units Remain
Sources close to London-based Deepgroup say that the award-winning interactive agency holding company is shutting down and selling off its assets to pay creditors.
The company, highly regarded for its creativity and design expertise, simply ran out of cash as clients cut internal marketing budgets, say the sources. More than 150 workers are expected to be laid off as a result.
While Deepgroup itself is no more, there’s a possibility that some of its agencies will survive, potentially through management buyouts.
The Alley-based office of company’s Deepend design unit, for instance, still has several paying clients — such as New York’s Fashion Institute of Technology, Bacardi and Salomon Smith Barney.
Additionally, Deepgroup’s ad agency, gluemedia, is likely going to continue under current management, as could PoolSide, which handles Web site maintenance. Relish, a public relations agency jointly operated with London-based communications firm WhiteOaks Consultancy, also could stay open through an agreement with Deepgroup’s partner.
Modem Media Reduces Staff, Leaves New York
Interactive shop Modem Media
said that it would reduce staff and close its New York offices, but still plans to make earlier estimates of a before-charges breakeven quarter.
Overall, the company is trimming about 7 percent of its workforce, which amounts to 40 people.
New York staffers remaining with the Interpublic-owned
company will be relocated to the firm’s headquarters in Norwalk, Conn.
According to Modem, those efforts will save it about $2 million next quarter, and about $11 million annually. But the cost-cutting will necessitate a $8 million charge, half of which will be recorded during this quarter.
“We are taking the necessary steps to adjust the structure and mix of our internal operations in light of the dramatic economic slowdown,” said Modem Media chief executive Marc Particelli. “For the balance of this year, we will take the necessary actions to ensure that we maintain our financial health and leading industry position.”
Modem also reaffirmed earlier guidance of a breakeven third quarter before one-time charges, with revenue down about $2 million to $3 million from the previous quarter.
The company also said that fourth-quarter revenues would be down an additional $4 million to $5 million, with cash earnings, again excluding one-time items, at about breakeven or “slightly below.”
Mediapassage Shuts Down
Just months after acquiring its nearest rival, Seattle-based Mediapassage has closed its doors.
The firm sought to become a clearinghouse for ad inventory, automating and simplifying the buying and selling of advertising using the Web. In March, it finalized the acquisition of OneMediaPlace, in a merger designed to combine OneMediaPlace’s front-end planning and purchasing functions — and strength in Web and outdoor media — with Mediapassage’s back-end systems for print and broadcast media.
Now, the situation looks dire for the company. A notice posted on its Web site says that the company cannot fulfill any ad placement requests posted after Sept. 21st.
The note also says that Mediapassage’s Media Buying System application would continue running until the end of the week, although it could only be used as a planning tool, since it would lack its buy-execution feature. The company’s creative submission tool, ArtSend, also would be supported through the end of the week.
Calls to executives and media spokespeople were not returned by press time.
Interep’s Winstar Interactive Media and Perfect Circle Add Clients
New York-based Winstar Interactive Media and Perfect Circle Media are adding a host of new sites to their roster of ad representation clients.
Both firms are units of radio ad sales giant Interep,
which is one of the largest radio rep firms nationally. The company represents more than 2,000 stations nationwide, including stations operated by Disney-owned
ABC Radio, Viacom-owned
Infinity Broadcasting, and others.
Through their new agreements, WIM will handle sales for Education.com, The Cool Quiz Network, and AskMen.com, while Perfect Circle Media became the exclusive ad rep for Mydiscountbroker.com — the subsidiary of Southwest Securities Group
— and financial news network ON24.com.
Los Angeles-based Education.com, a unit of Vivendi Universal’s
publishing unit, is a portal for educational news, tips, features and communities, which is geared for teachers, parents and students. The Cool Quiz Network, located at coolquiz.com, focuses on polls, quizzes and community features aimed at teenagers and young adults. According to WIM, the Jamison, Penn.-based firm attracts about 1.1 million unique visitors monthly.
Alley-based AskMen.com, meanwhile, is one of the Web’s most popular men’s lifestyle sites, based on figures from Nieslen//NetRatings.
As with its other ad rep clients — which include uBid.com, Entrepreneur.com and Fodors.com — WIM said it chose to represent the sites because of their high visibility and established brands.
“As other Web rep firms and networks struggle or founder, Winstar Interactive Media is only growing stronger,” said WIM president John Durham. “Our philosophy of selling a variety of marketing programs customized to the individual site brand is enabling WIM to avoid being caught in the downward banner CPM spiral.”
Meanwhile, PCM executives said the new clients continue efforts to build a critical mass of impressions. The company said it now handles sites with an aggregated total of 150 million monthly page views.
“PCM founders Jim Henderson and John Abraham are fulfilling their vision of helping advertisers reach the biggest and best of the online financial and business categories by signing rep agreements with Mydiscountbroker.com and On24.com,” said Adam Guild, who is president of Interep’s interactive unit. “Both publishers have the creditability and reach to add to PCM’s reputation as the single best source of online marketing solutions for advertisers seeking to reach serious investors with high net incomes.”
Slate.com, Space.com Among new OPA Members
Online news magazine Slate.com and New York-based Space.com are among four new charter members of the Online Publishers Association (OPA), the advocacy group created to represent the Internet publishing industry.
The group, which is headed up by New York Times Digital (NYTD) head honcho Martin Nisenholtz, said Slate.com, Space.com, Bankrate.com and weather.com were the newest members to hop aboard.
Slate.com, founded and edited by well-known political commentator Michael Kinsley, is published by Microsoft Corp.
Slate’s publisher Scott Moore will serve as a representative on the OPA board.
John Ferrara, president and CEO of multimedia site Space.com, is also among the newest representatives, along with weather.com’s Debora Wilson and Elizabeth DeMarse, president and CEO of Bankrate.com.
Space.com, headquartered in New York City targets space enthusiasts and provides space business news, information, education, and entertainment. The company also publishes Starry Night and Space News, publications dedicated entirely to space business.
The four new members are the first to join since the OPA announced in June that twelve of the biggest names in the Web publishing had created the group to deal with the advertising community, the media, the government and the public.
The founding members of the OPA New York Times Digital (NYTD), the Wall Street Journal Online (WSJ), CBS MarketWatch, MSNBC.com, CNET Networks, Inc., Conde Net, ESPN.com, The Industry Standard, KnightRidder.com/Real Cities, Salon Media Group, Inc., USATODAY.com and the Washingtonpost.Newsweek Interactive.
Michael Zimbalist, acting executive director of OPA said, “Each new member brings a unique perspective to the group and helps strengthen our mission of advancing the online publishing industry.”