AOL has laid off 100 employees while it integrates with the new corporate parent, Verizon. However, the latest round of layoffs was not an unexpected one. Verizon earlier purchased AOL for $4.4 billion and most of the AOL units also overlap with the Verizon divisions. Nearly two-thirds of the cuts are in AOL’s membership division that specifically handles dial-up service, AOL Mail, and AIM. A report stated that some marketing staffers and social media roles have been drastically affected, but the major focus is on the operation layer. The layoffs are under 2% of AOL’s 6000 workers.
Initially, Verizon had bought AOL solely for advertising and video operations and not for the dial-up business. However, it manages to generate a substantial amount of revenue due to the fact that 2.1 million people still use AOL dial-up, paying a $20 per month charge, on an average. Previously, AOL reportedly earned $186 million in a single quarter as an independent company. Moreover, Verizon has its own Internet subscription products and consumer service departments so the overlap should be reduced as much as possible.
“The market changes and we at AOL change ahead of the market. As we have continued to do over the last six years, we have re-aligned a handful of key customer functions to put our consumers and customers more squarely at the center. We have done 3 years of deals in the last 6 months,” an AOL spokesperson said in a statement provided to TechCrunch.
AOL has previously held a round of layoffs before Verizon purchased it, cropping 150 employees, especially in the sales department, although most of AOL’s underperforming web publications were also shuttered.