According to New York Times, a consortium of CNET investors, led by large investment funds such as Jana Partners, are seeking to take over CNET’s board of directors. The consortium has a 21% stake in CNET’s ownership, and they’ve sent a letter with their plan to the CNET board approximately two weeks ago, but CNET has been silent so far, supposedly preparing to put up a fight against this initiative.
Although CNET hasn’t commented on the proposal directly, they’ve issued a statement on Saturday, claiming that the company has “made significant strategic, financial, personnel and operational progress.” However, Wall Street analysts don’t seem to agree: their almost uniform prediction is that CNET shares will slump, continuing the trend that has been going on for the last three years, in which the shares have lost 19% of their value.
The problem with CNET is that it’s simply too big. They’re doing their best to follow the trends (mostly by acquiring smaller sites, such as Gamespot or MP3.com), but advertisers have found that advertising on smaller, niche sites is cheaper and more effective. The way the company is managed needs to change. However, the question is whether a bunch of investment funds - should they succeed in gaining control of the board of directors - will have the vision to make the necessary steps to put the company back on the right track again.
No comments:
Post a Comment