Infoseek has closed its push technology division with the lost of 15 employees, after announcing a loss of $11.9 million (#7.4 million).
The Internet search engine specialist said its loss included a $7.4 million restructuring charge related to the layoffs. For the firm's second quarter ending on 30 June, Infoseek reported revenues of $7.7 million, up 134% on revenues of $3.3 million for the same period a year earlier and up 25% on the firm's previous quarter. Without the restructuring charge, the company would have reported a net loss for the quarter of $4.6 million.
The push section, known as the corporate information division (CID), had only a brief operative life. Started in February, the division ran a corporate service to send out content to subscribers' desktops. It is believed the decision to axe the unit came from Harry Motro, the former CNN Interactive executive who took over as president of Infoseek in May.
"What Harry is trying to do is figure out our strategic direction for going forward," said Infoseek vice president Tom Browne, the company's acting chief financial officer. "Harry's about a month away from articulating that direction, but clearly the CID isn't part of it."
Browne said Infoseek has offered new positions to most of the staff made redundant. "I wouldn't call this a lay-off," Browne added. "I'd call it a refocusing of our strategy." Infoseek is now focusing on business-oriented Net users and relinquishing the general-interest directory business to search firms such as Yahoo and AltaVista.
Browne said the CID was originally intended to give the company a footing in the burgeoning market for push services, but "in the end, we just thought we didn't want to participate in it".
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