The decimation of what is left of Shopping.com (the original IBUY, not the fromage facade) continues: "AltaVista to Cut Quarter of Work Force As Slowing Web-Ad Market Batters Firm
By DAVID ARMSTRONG
Staff Reporter of THE WALL STREET JOURNAL
AltaVista Co., the Internet-search company owned by CMGI Inc., cut
200 jobs representing a quarter of its work force, as the slowing
online-advertising market continued to batter the company's bottom line.
AltaVista (www.av.com) is the latest CMGI
entity to announce cost-cutting plans. Earlier
this month, the Engage Inc. online marketing
unit said it was slashing half of its 1,100
employees and changing the focus to lessen
the company's dependence on Internet
advertising.
CMGI, of Andover, Mass., also has sold or
closed unprofitable subsidiaries in the past several months as the once
highflying Internet incubator aims to become profitable. CMGI shares have
plunged from a 52-week high of $151.50 on March 7 to $6.84 as of 4
p.m. Thursday in Nasdaq Stock market trading.
AltaVista, based in Palo Alto, Calif., has experienced a tumultuous past
few months. In September, an earlier work-force reduction claimed 225
employees. In October, Chief Executive Rod Schrock left the company,
whose chief financial officer retired at year's end. AltaVista now will have
600 employees.
Last week, AltaVista formally withdrew its once-promising plan to sell
stock in a initial public offering that was expected to raise as much as $296
million. CMGI bought AltaVista from Compaq Computer Corp. in 1999
for $2.3 billion.
Like other struggling search companies, AltaVista said it is focusing on
corporate customers who use search technology to index and retrieve data
from large, internal databases. AltaVista charges clients a licensing fee to
use the search software. By focusing on the licensing business, AltaVista
expects to decrease its dependence on the ailing online-advertising market.
"These are challenging times for most Internet and technology companies,
but we are confident in the steps we are taking to remain strong," said
Peter Mills, executive adviser to AltaVista and managing partner of the
CMGI @Ventures investing unit.
AltaVista said it is signing up corporate customers at a rate of about one a
day and is launching new sites in foreign markets.
Write to David Armstrong at david.armstrong@wsj.com
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