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22 Aug 2001
Long rumoured job cuts at AOL Time Warner were finally confirmed on Tuesday when the company said a total of 1700 employees would be laid off.
About 1200 jobs will be eliminated at the America Online division, or about 1.4 per cent of AOL Time Warner employees. Another 500 jobs are to go at iPlanet Ecommerce Solutions, the AOL/Netscape/Sun Microsystems joint venture.
Analysts have been expecting the job losses as AOL Time Warner wants to prove the merger is a success by hitting financial targets. The deteriorating online advertising market forced management's hand.
"You don't like to cut jobs if you don't have to. My feeling is they're stretching to make their numbers," said Walter Price, an investment fund manager.
AOL chief executive Barry Schuler said that no more cuts are planned and that employees have not yet been told who will go and who will stay.
The company previously cut 6200 jobs, or seven per cent of its workforce, as part of a restructuring following the $124bn takeover in January. AOL currently has 16,000 employees and iPlanet has more than 2000.
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