We will have another layoff at the end of May. 20% of the field base sales reps will be let go and that will trickle down to some of the DM’s and one more VP being let go. They will also announce the Pearson Higher Ed division is for sale within the next two years. Already feeling out the market now for a possible sale.
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@7bmx+1e5JCnj7. Enjoyed your post. The problem is that publishing (yes it is publishing, not ed tech as far as Pearson is concerned) has always been a short-termism business.
In the 1990s it was holding all returns on trailers in the warehouse parking lot till Jan 1 and raising prices with impunity.
In the 2000's it was stuffing channel partners (including used book dealers) to the gills with deeply...deeply discounted products, most of which would be returned.
Now, that the market has essentially embraced digital, there are no levers to pull and the products stink and no one wants to pay for them.
And look at the revolving doors of upper management. There is zero commitment, nor will there ever be, to a long-term view. A terrible existence.
I actually think Pearson tried to control the distribution channels with its $500mm purchase of eCollege but the "brilliant minds" who did that deal forgot that institutions either had their own LMS, or used a myriad of others...Blackboard, Angel, Moodle.
There was no way they were going move to a Pearson LMS or effectively use multiple systems just to get Pearson content.
Virtually all of those people somehow are still employed, either at Pearson or other companies. That should tell you all you need to know.
To add, all content/textbook publishers were beneficiaries of bloated enrollments after the financial crisis of 2008. For Pearson it falsely inflated the profits in the short term and the company “adopted” a Too Big to Fail attitude.
Now the market has changed dramatically. Channel partners hold all the leverage as they smartly invested in the institutional vertical and took up the gatekeeper mantle for all things Inclusive Access. Pearson has tremendous market share but zero innovation and is beholden to a sales model in which the decision-maker, buyers, and end-consumers are all actively trying to find ways to not pay for Pearson products.
The only silver lining is that the pandemic fired a warning shot to the bow of institutions that they better transform or they will be irrelevant. There is BILLIONS to be had with partnering with higher Ed colleges but I’m not sure Pearson will have the appetite to acknowledge their position and be willing to truly be bold and add to their revenue streams with viable campus services. If they somehow can it would be game-changing to have a content provider compete with Oracle, Ellucian, etc. If not— I’m not certain there will be a Pearson in a few years.
The chickens of all the acquisitions of the 1990s and 2000s have come home to roost. The company is too big and slow to really innovate. And the real problem is that it's hard to innovate when customers (students) hate your product and don't want to pay for it.
The only place to be in education is a small, well-funded disrupter. Pearson and Cengage will die by 1,000 cuts. It won't happen tomorrow, but the end is very clear.
I have even less respect for our CEO’s after Reading through this thread and seeing all the businesses they have sold and how very little was reinvested into our core online products! Revel was a huge miss! Pearson eTexts another miss. Not sure what happened with our new platform? Pearson will continue to lose because our products aren’t as easy to use as other companies and they are stale.
I’m sure Mr. Bird has quickly figured out that no one gives a cr-p about educational materials like they care about the latest Disney movie.
He will fall into the long line of failures who were brought in from the outside to revolutionize the business.
The business is what it is. No one wants to pay for stuff they can mostly get for free.
When you continue to have management in place with no experience or common sense, the ship will continue to sink. This ship is close to hitting the bottom, good thing a CEO was hired with no experience in this industry. The minority of shareholders never wanted him hired.
The blueprint is cut everything to the core then raise prices. It will be back to the days of 6-8% price increases yearly. That's the only option. There is no real growth, no innovation. There is no market share to take that really moves the needle. I have no idea why anyone would want to buy a dinosaur business, but private equity views the world differently than normal people.
I'm sure there are people at Pearson who always are looking to sell the business. Why would they not? The question is can they find someone d-mb enough or willing to leverage everything (see Apax-Cengage) to warrant a sale. I guarantee you that shareholders would ok a deal that gave them a decent reason to dump all of that dog of a stock.
Pearson has sold their K-12 business, The Economist, The Financial Times, Penguin and several smaller companies. Why did they sell off those other businesses? Because they didn’t think the future looked bright.
McGraw has been sold twice. Thompson (Cengage) was the smartest and sold at the top of the market. Bird mentioned a few times we needed a good year and to turn it around for our investor. It was “very important “.
Selling Pearson higher ed makes sense. 7 years ago would have been ideal. Textbooks and courseware are a dying market. It doesn’t take a rocket scientist to guess selling has to be on the table.
the old ceo started calling out USHiEd losses specifically during investor calls late 2018. The tone certainly was one which carved out courseware as a sinking ship, as if USHiEd wasn't part of the Pearson portfolio the stock would be up. AB's expertise with direct to consumer seems to echo that as well.
I'm hearing of some additional layoff's in marketing too, non-revenue generation position.. although with negative sales goals we're all in that spot together.
I believe it, the exact dates not withstanding. Higher Ed is blamed for the stock price but the price is low for more than higher ed. Sold might be good. Marketing is useless in general. No offense to those who do it but it's not a full time job.
Timing isn't exactly right. But this is true and there will be impacted employees next week. Mostly marketing and some recruitment as well.
Disgruntled employee
Source?