Richard Gingras is stepping down as CEO of Salon, left-leaning news and cultural site he helped round up seed funding for back in 1995. After steering Salon through several areas of focus, from long-form journalism to broadening the site beyond politics, Gringas considered a sale of the company earlier this year. But as the NYT reports, deal talks with news aggregator Newser fell apart over the past few months.
Updated: Gingras is leaving the company to oversee Google (NSDQ: GOOG) News. (Read more here.)
Although traffic has generally improved over the years, Salon has struggled where early rivals like Huffington Post, Slate and the still independent Talking Points Memo have thrived in terms of both traffic and revenue.
One of the key differences between Salon and its close competitors was that Salon tended to model itself on longer, narrative newspaper and magazine style of reporting, as opposed to the quick, sharp blog formats of HuffPo, Slate, TPM and others. Still, the content business is a tough one, as the combined Newsweek and The Daily Beast is still expected to lose many millions for parent IAC (NSDQ: IACI) this year despite strong online ad market.
While the company did achieve higher traffic and improved its ad revenues thanks to expanding into content areas such as food and the introduction of more e-commerce. But there was not much Gingras could do beyond that aside from continuing to cut costs. Slashing expenses is a defensive measure, with the underlying idea being that Salon would live through its troubles, thanks mostly to the deep and forgiving pockets of backers like board chairman (and Adobe Systems (NSDQ: ADBE) co-founder) John Warnock and investment backer William Hambrecht to help alleviate shortfalls. But that’s about it; there was never really enough investment to provide real growth.
That’s not to say that Salon, which made it through the first dot-com crash, is toast. “Scale matters,” Gingras told the NYT. “Salon is not there yet with that scale, but I expect it will be.” If that sounds like wishful thinking, it is. But right now, the best possibility is for Salon to find some larger media company willing to not only absorb its losses, but provide the investment to grow the business. At the moment, there doesn’t seem to be any easy fit with any other entity and there aren’t too many visionary CEOs waiting to take their turn at taking over and rebuilding the brand. But if it can somehow balance the cuts without losing its value to readers, Salon might just might continue going and living up to its early promise as a web-only news site.