AOL to cut 20% of jobs

AOL has confirmed that it is cutting 2,000 jobs worldwide, some 20% of its workforce. This week’s cuts follow a 5,000 headcount reduction last year.

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The cuts will be made across the board. "We're in the midst of significant transformation of our business from dial-up ISP to an advertising-supported Web company, so we've looked across the organisation, and we're looking at making the organisation operate as efficiently as possible."
said an AOL representative.

The company has pledged to increase investment in "high-growth" areas of the bsuiness, including its advertising network and in publishing.

"This realignment will allow us to increase investment in high-growth areas of the company - as an example, we added hundreds of people this year through acquisitions - while scaling back in areas with less growth potential or those that aren't core to our business, as we did with the sale of Tegic," AOL chief executive Randy Falco told employees in an internal memo seen by Computerworld.

In the memo, Falco said AOL recently expanded its advertising capabilities, which included the acquisition of three advertising companies, AdTech, Third Screen Media and Tacoda, and launched a new advertising initiative called Platform-A.

"AOL now has one of the largest and most sophisticated ad networks in the world, and we're well positioned to compete where the ad market is heading," Falco said in the memo. "We refocused the business around three core areas -- Platform-A, publishing and access -- and are now managing these as three distinct but related components."

Falco said the job cuts were needed to help the company operate as efficiently and as effectively as possible.

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