More Massive Layoffs at AOL

dawnzer writes "It looks like AOL read the comments from Slashdotters saying that 950 employees do not constitute a 'massive' layoff. Several news sites are reporting that AOL is getting ready to cut 5,000 jobs, or roughly 26 percent of their global workforce. Now that's more like it."

Recent mass mailing from AOL

[QuantumFTL]

Here's AOL's most recent mailing to all of its customers:

Dear AOL Member,

I want to let you know about some exciting changes happening at AOL. Our service has always been an all-in-one solution for our members, consisting of:
      1. Connectivity - a way of connecting to the Internet (through a dial-up or high-speed connection), and
      2. Content and Services - bringing you useful tools and features like email, security and an entertaining online experience once you're connected.

Today we are announcing that AOL's software, email, and other compelling AOL features will be free to everyone who has an Internet connection -- including your Address Book, Screen Name, the Buddy List® feature and more. AOL will continue to provide a dial-up connection for you, and we will continue to offer several reliable and affordable options for getting online.

What Does This Mean for You?

Nothing about your service arrangement with us will change unless you want it to. Your current plan, which includes Internet connectivity, 24/7 customer support, unlimited email storage, your email addresses, and all the AOL content and services you rely on, will still be there for you.

If you do at some point choose another provider to connect you to the Internet:
        * You can keep your AOL Screen Name and email address for as long as you want to use it, completely free;
        * You can continue to use your AOL software, and you can still get all your favorite features and content, completely free;
        * You will still get AOL's comprehensive safety and security tools, protecting you from online hackers, spammers and identity thieves, completely free.

All of this is free, no matter who provides your Internet connection.

Why Is AOL Doing This?

We're simply changing with the times. There are many options for Internet access, whether it's dial-up or broadband. At the same time, a lot of online content and services are now available on the Web free of charge because they are supported by advertising. So, while your Internet connectivity needs may change over time, what you love about the Web does not. We are now able to ensure that the familiar AOL experience, your Screen Name, your Address Book, your Buddy List, your Favorite Places, and other content and features you enjoy, will always be available to you for free.

In September, you will be hearing more about changes at AOL. Until then, you can visit AOL Keyword: New AOL for more information and to sign up for informative email alerts.

Sincerely,

Jon Miller
Chairman and CEO
AOL LLC

Re:How Do companies make money off just ads?

[neo8750]

You have to remember how large of user base AOL has. Sure its not as big as it was a couple years back but its still pretty huge. My girlfriends mom had AOL for a long time till she got broadband. However she kept AOL even when they didn't offer free (5 dollars a month). The reason for this wasn't because she loved AOL but, since she didn't want to go through and change her emails over to another provider. Now if 1/2 to 3/4 of people who have AOL keep their emails accounts that is a lot of people viewing their ads every time they check there email. I'm sure they have some deal worked out that they get a flat rate for just showing the ads to there customer base. Add that to the ammount they make when people actually buy stuff and they get a commision for it. I think that it probly be possible. Maybe not for a smaller based company but I think they can pull it off.

Layoffs != AOL Going Away

[Anonymous Coward]

Most of the layoffs are expected to be in either Member Services, Marketing or the Access business. This is in line with the direction of where AOL wants to go. It really doesn't mean anything to AOL's future except that they are a) selling off the European business and b) they don't need to have the same marketing machine that they needed to before to sell access.

This does NOT mean that AOL is shutting down shop on the current customers. They will be supported as long as they want to pay for access. But the joke about the CDs is actually probably spot on. Yes, this move means the CDs pretty much go away and yes, the some of the people being let go are the people who sent the saucers.

So, ultimately, these layoffs are meaningless to the overall picture. If AOL had suddenly morphed into Google or Yahoo, the same thing would have happened. Google doesn't sell access and Yahoo doesn't sell dialup (although there are broadband deals they have been associated with). So, if AOL is to become successful in the same way, they would be shedding those very same employees in some manner.

What will be the real predictor of AOL's demise? Look to the new VideoSearch initiatives in particular. That initiative is being pushed from on-high, and there are some people's jobs at AOL which are quite safe because of that initiative. If VideoSearch works out, AOL will be hiring more people, not less, because the current staff working it is already overworked. Should success be apparent, the 5,000 jobs lost by October could be all rehired for Streaming and Video.

Do I think it *will* work? No idea. Needless to say, no one currently employed at AOL is naive about the possibility of failure. At the same time, Video and Streaming is pretty big and it's about the only place AOL seems to be in a position to lead in, so success is possible.

AOL employees are quite well aware that AOL isn't providing anything other than repackaged things that other people have done first, and usually better. And some of the senior management know that this is the case too. There has been more than one meeting where a VP was asked, "what are we doing that is original?", and the exec sort of stood there, thought for about a minute and eventually said "nothing I can think of other than Video". Scary, but at the same time, it's rather heartening that they didn't try to tell us that something like the new Netscape site (aka Digg) was going to propel us back to a leadership position. It won't.

Re:Sweet

[Heir Of The Mess]

Yeah the reply is acting like an AOLuser by adding a comment "ME TOO!!!". AOLusers are known for using excessive capitalisation and punctuation, as well as stupid replies like "Me too".

Re:Of what quality are the jobs?

[andy1307]

More details in the Washington Post [washingtonpost.com]

At least 45 people whose jobs involved ordering and distributing AOL's free promotional CDs were told last month to take paid leave and look for new jobs, according to one executive who spoke on condition of anonymity because he was not authorized to talk to the news media.
A larger portion of the cuts are expected to come from AOL's business in Europe, where AOL has said it is negotiating to sell its dial-up-related business to European telecommunications firms.
Since the beginning of the year, AOL has shed 1,300 positions, mostly in its call centers in Florida and Arizona. The majority of jobs expected to be eliminated in this round are in the marketing and other divisions related to recruiting new subscribers. AOL and Time Warner executives said they found those efforts were no longer profitable and said they plan to end them.

Re:Now that's more like it??

[dreamchaser]

No, because he didn't have the sense to file letters with the credit reporting agencies explaining the bankrupcy...trust me, dispute letters DO work.

The US has some of the lowest unemployment in the world. In fact, economists hate it when it gets much lower than it is now because labor costs start to rise exponentially. Don't give me the 'they are all minimum wage jobs' line either. They are not. I don't know about your area, but around here (Pittsburgh) even a fast food restaraunt has to pay quite a bit more than minimum wage or they won't get anyone to work.