(The Industry Standard)

Earlier this year, AOL Time Warner execs told the Wall Street Journal that its February layoffs would be the last merger-related job cuts. It didn't say anything about job cuts to impress investors. That may be an exaggeration, but media reports of possible sackings didn't offer any better reasons.

The now-ubiquitous "ad slowdown" has hit AOL's online unit as is has every other media company, but observers insist the behemoth is healthy. If AOL is so robust, why the pink slips? "To meet its aggressive financial goals," said News.com, including a bold prediction of $40 billion in revenue. Reuters sources agreed that AOL Time Warner is "trying to ensure it will meet its 2001 financial targets," and the Los Angeles Times said AOL is "struggling to please Wall Street in a slowing economy." Wall Street wasn't pleased by the layoff rumors, however, and sent shares of AOL Time Warner down 3 percent on Monday. How's that for gratitude?

Anonymous sources predicted several hundred to 1,000 lost jobs, this month or this week, in unknown AOL divisions. Besides citing nameless insiders, outlets also gave plenty of ink to analysts. (Note that when the media aren't questioning analysts' integrity, we're quoting them.) "Analysts said AOL executives began telling investors earlier this month to expect additional cost-cutting and layoffs in the near future," said the L.A. Times. At least the investors are well informed, unlike nail-biting AOL employees. Reporters' attempts to clear the air were consistently rebuffed by AOL spokespeople. The New York Post's Joe Gallivan, who was shot down by "three separate spokespeople at the well-oiled media machine," might hold the record.

The Washington Post, a local paper of Virginia-based America Online, said 1,000 layoffs would be almost 7 percent of AOL's workforce (though only a bit more than 1 percent AOL Time Warner's total employees). Seven percent? Are you sure that's just some minor belt-tightening to help AOL reach its ambitious financial targets? Right, we forgot: no comment.

AOL set to lay off hundreds from online arm
CNET.com

AOL shares hit by layoff talk
CBS MarketWatch

AOL mum as layoff talk mounts
CBS MarketWatch

AOL Time Warner to lay off online workers
USA Today (Reuters)

Up To 1,000 Job Cuts Are Expected At AOL
New York Post

AOL online unit to see more layoffs
MSNBC

AOL to Lay Off Up to 1,000 Workers
Washington Post

AOL preparing for more job cuts
Los Angeles Times

Copyright (c)2001 The Industry Standard