The turnover on the Gale side started 18-24 months ago and does not seem to be slowing down. Is there any intel about where this side of the business is going?
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Library budgets (public, K12 and academic) rely heavily on grants for obscure programs. With Elon and DOGE taking a wrecking ball to these spending programs there will be direct and indirect consequences in terms of content spending. That may finally deliver the de@th blow to Gale.
Twenty years ago Gale generated about $400 million in revenue. It's now at ~$150 million and shrinking rapidly every year. They are just managing the decline of the business.
The Gale unit is an albatross within the Cengage portfolio. Far too much money, time and resources are being spent to keep this dying company on life support. Gale is a financial burden and liability to Cengage. It drags down the entire company. With Federal education budgets being cut, there will be less of a demand for these tax payer subsidized services as there will be less money available to pay for this content. It is best to just cut losses and liquidate this division or sell off assets to another buyer, if even at a loss, as the losses will continue to multiply if resources continue to be allocated to this failing division. This is sunk cost fallacy in action.
Gale has been a problem child for corporate going back to the Thomson days. They're an odd fit in that they produce reference/library content that isn't typically used in a course or curriculum. Every year there were rumors of a sale, but the library market has been in slow decline for decades making it an unattractive acqusition target. But they're just profitable enough with their subscription base to prevent private equity from winding the business down. They tried integrating Gale into higher ed once in the early 2010s thinking they could use Gale content in MindTap. That was an unmitigated disaster. It seems that they are now just slowly squeezing cost out of the business to get as much juice as they can out of the reference market as it continues its slow decline into irrelevancy.
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It should be obvious at this point that Gale is on the chopping block, sort of. Everything seems to be going in the direction of consolidation with Gale employees being transitioned under the Cengage umbrella. Many of the Gale teams have already been realigned with a final push to be completed this year. Project Horizon is not over yet.
It's the same with Cengage Academic. They keep telling us that we're near the end of Project Horizon, but I am quite certain that they still get rid of the remaining 20-30 CMs & DPMs. Also, a lot of people from the Technical Content team are being let go.