AOL Lays Off 700 Employees

Posted on October 27, 2005

EcommerceTimes reports that AOL is laying off 700 employees. Most of the layoffs are coming from AOL's customer call centers. AOL said its customers were becoming more savvy and no longer need as much support but that sounds like a stretch especially in the age of phising, viruses and other security threats. An analyst at Grey Consulting told the EcommerceTimes that the weakened AOL still has enough subscribers to be attractive to Google.

The AOL job cuts, which fall in line with similar cuts made periodically over the last few years, reflect a dropping user base that has been driven by a number of factors, Grey Consulting founder and principal analyst Maurene Caplan Grey told the E-Commerce Times.
The analyst, who doubted increased user savvy was behind the cuts, indicated a recent instant messaging deal for interoperability between Microsoft and Yahoo may have also contributed to the job cuts, and further subscriber loss is likely to increase the chances of an acquisition.
Grey added that, although its user base is dropping, AOL still retains a substantial subscriber base of millions, which may be attractive, particularly to the ever-expanding Google.

If not Google then one of the many companies that is trying to compete with Google might find a merger with AOL very helpful. Why not Amazon.com and AOL in the age where content, ecommerce and search are merging together?