Murdoch Dumps Klein's Amplify: Stock Worth Minus 42 Cents Per Share

After Rupert hired NYC's former chancellor and education profiteer, Joel Klein, News Corps spent a billion dollars to promote Amplify's digital education solution, which amounts to cheap laptops loaded with an endless supply digital worksheets for schoolchildren of the poor.  

This week Murdoch fired Klein and sold what remains of a busted company, taking a beating in the process. That's what I call a serious feedback issue.

From the Sydney Morning Herald:

Max Mason
Published: October 1, 2015 - 4:02PM

News Corporation has sold its digital education play Amplify for an undisclosed sum after the loss-making business laid off 500 employees, or about 50 per cent of its workforce.

The sale was flagged at News Corp's financial results in August, where Amplify was the driving force behind the media conglomerate's $US149 million full-year loss, thanks to a $US371 million write-down in the digital education business.

News Corp said Amplify had been sold to a management team supported by a group of private investors.

Amplify was born from the purchase of Wireless Generation for around $US390 million in 2010.

News Corp originally bought Wireless Generation, expanded and relaunched the business as Amplify with the former chancellor of the New York City Department of Education, Joel Klein, as chief executive.

Larry Berger, the co-founder of Wireless Generation, who was president of Amplify Learning, will reportedly become chief executive of Amplify.

Mr Klein will remain on the board of News Corp.

Deutsche Bank estimated that Amplify would have made a $US117 million loss in earnings before interest, tax, depreciation and amortisation in the 2016 financial year, with a valuation of negative $US235 million, or negative US42¢ per share.

News Corp has invested more than $US1 billion in Amplify and chief financial officer Bedi Singh told investors at the briefing in August that results had been disappointing. At the time, News Corp said it had stopping selling products to new customers and was in the final phase of talks to sell Amplify.

The majority of the 500 job cuts, a mix of full- and part-time employees, took place on Tuesday, US time, with the remainder of affected staff staying through the transition period.

News Corp chief executive Robert Thomson said the company was extremely proud of Amplify's work.

"It is tragic that so many children are digitally literate but functionally illiterate, and it has been the cherished vision of all at Amplify to ensure that students, regardless of their background, have access to a contemporary curriculum delivered on a contemporary platform," Mr Thomson said.

"There is no doubt that the foundations laid by the creative team at Amplify will be profoundly influential in coming years as both curriculum and classroom evolve. All who have been involved in the Amplify business at News Corp should be conscious of their contribution to education in the US and beyond."

This story was found at: http://www.smh.com.au/business/media-and-marketing/news-corp-exits-digital-education-business-amplify-20151001-gjyp19.html