In forcing Ebony Media Holdings into a Chapter 7 filing, investment firm Parkview Capital Credit announced it planned to position the company for the longer term. It's not clear what that plan will involve, given that much of Ebony's value is in its storied brand rather than as a business.
The bankruptcy filing came a few weeks after Ebony Media's board ousted former CEO and principal owner Willard Jackson amid accusations of making unapproved financial transactions and trying take control of the company, The Wall Street Journal reported.
Ebony hasn't been profitable in the past decade and currently has five full-time employees, down from more than 300 in the early 1970s. The magazine is available in digital form after it stopped publishing a print version last year, while sister publication Jetbecame a digital-only property in 2014.
The company also has little ad revenue and no digital paywall to earn money from readers, giving it few financial resources to develop editorial content. Jet hasn't run a new story in more than a year, while Ebony has sporadic updates among a variety of topics.
The publications can't reverse their fortunes until owner Clear View Group, which acquired Ebony and Jet in 2017, and its creditors resolve their current disputes about how to manage the company. They need to work fast to develop a strategy to expand Ebony's editorial output, possibly by diversifying into growing areas like podcasting, to give readers a reason keep coming back to its website.
They also need to cultivate a following among younger readers, which is a challenge, considering the competition from other digital publications and social influencers capturing the attention of that key audience segment.
From there, it can work to rebuild ad sales and reader revenue from premium content and exclusive features. It's a daunting task that's going to require prolonged investment, especially to survive the recession in media spending during the pandemic.
Ebony faces the possibility of disappearing, which is a shame, as media companies examine how they can better promote racial equality and provide more opportunities for people of color to advance into more visible leadership roles.