AOL chief Tim Armstrong announced major layoffs on Thursday.
The cuts, while expected, were big: 200 employees in the U.S., and roughly 900 worldwide. All told, about 20 percent of AOL's 5,000 employees were let go.
"Today is the next critical step on the comeback trail for AOL," Armstrong wrote in a memo announcing the restructuring. "We are creating a next generation hyper-local, national and global media company, and every action we’ve taken since AOL became an independent company has taken us further down that path."
The 200 U.S. jobs will come from AOL's media and tech groups, while the bulk of the cuts overseas will be in India. All "impacted employees" will be notified by 3 p.m. (EST) today, he said. A conference call for AOL's remaining employees is scheduled for 5 p.m.
The move comes less than a week after AOL closed on its $315 million acquisition of the Huffington Post -- and a little more than a year after AOL cut 2,500 jobs. Armstrong said the cuts would save the company about $20 million in the short-term.
A representative for AOL said Armstrong would not be available for comment beyond his memo Thursday. A representative for the Huffington Post did not return an e-mail seeking comment.
"AOL remains in the middle of the disruption that the Internet is causing and we are starting to move from being a disrupted brand to a brand that is leading the disruption," Armstrong wrote. "The changes we are making are not easy, but they are the right changes for the long-term health of the company, the brand, and for our employees."
In terms of content, Armstrong said AOL's plan is to replicate the editorial-driven model of the Huffington Post (now the Huffington Post Media Group within AOL) across AOL's media brands. However, the editorial staffs for several of those brands -- AOL News, Daily Finance, Walletpop and Politics Daily -- have been "decimated," according to Jeff Bercovici, who worked at Daily Finance before jumping to Forbes.
"The editorial-driven model of The Huffington Post Media Group will change the way we create our content," Armstrong wrote. "Going forward, AOL will invest more heavily in our in-house editorial team and transition away from a reliance on freelance journalists. Journalists are the heart and soul of a media company, and our reporters and editors will be working closely with the tech group to produce compelling and engaging editorial content -- including lots of video."
Here's Armstrong's entire memo:
From: Armstrong, Tim
Sent: Thursday, March 10, 2011 5:46 PM
To: Armstrong, Tim
Subject: AOL’s Next Step
AOLers -
Today is the next critical step on the comeback trail for AOL. We are creating a next generation hyper-local, national and global media company, and every action we’ve taken since AOL became an independent company has taken us further down that path. Our strategy remains clear: create high quality content experiences for consumers, at scale.
