AOL Cuts 900 Jobs In Huffington Restructure

AOL, the Internet giant from America (AOL was previously called America Online).

In 2010 AOL’s revenue was US$ 2.417 billion however its net loss was US$783 which was partly due to the purchase of the Huffington Post (a popular online news and celebrity newspaper) which it paid £196 million for.

Some of the jobs will be lost from the web content and web development offices in America. Many jobs are likely to be lost in its overseas offices in India, with a reported 700 positions being lost, although 300 jobs will be transfered to AOL outsourcing partners. The main reason for the loss of jobs is the duplication of work from the AOL web teams and the Huffington Post content teams.

AOL’s CEO Tim Armstrong said that “our strategy remains clear: create high quality content experiences for consumers, at scale”.

Their plan is to use more in house editors and fewer web content freelancers to save money.

AOL is a web content provider and this part of the Internet has recently been hit hard by an update by Google to its search engine ranking methods (in project Panda / the farmer update). Many websites that were receiving a lot of traffic from Google are now receiving much fewer customers each day which has resulted in falling advertising revenues.

Huffington Post was founded by Arianna Huffington who is now one of America’s richest women and a very influential blogger.

Over the last decade subscribers to AOL’s Internet services has fallen sharply due to increased competition in the ISP market. Its client base by around 75%.

In 2006 AOL sold its UK ISP business to Carphone Warehouse for £370 million. It seems that AOL is moving away from direct services and trying to become a key web content provider, much in the way that Demand Media has started to dominate the market.

  1 comment for “AOL Cuts 900 Jobs In Huffington Restructure

  1. Jon
    May 16, 2011 at 7:54 pm

    Before this news I never knew that Huffington Post was such as big site with so many people working for it. It is amazing how an individuals blogs can turn into a hugely successful company.

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