No European Job Cuts For AOL This Time

Tim Armstrong

Update: CEO Tim Armstrong’s full memo to staffers.

AOL (NYSE: AOL) will make no job cuts in Europe, the company tells paidContent:UK, despite a 900-person cull that will include 200 lost from its U.S. media and technology groups plus 400 laid off and 300 outsourced in India.

The U.S. layoffs are broadly the result of AOL’s $315 million Huffington Post acquisition, which CEO Tim Armstrong last week told our paidContent 2011 conference would result in $20 million in “synergies” – overlapping duties on the content side that could subsequently be eliminated. The AOL India changes were in the works before the merger but were folded in, according to a source familiar with the decision.

AOL Europe is full-square behind AOL’s content-led recovery – indeed, it already divested its ISP businesses years ago. But, even before Huffington’s arrival, most of that strategy was dictated from across the Atlantic, with blogs occasionally localised for European markets.

AOL already made its big European cutback a year ago, when, whilst announcing plans to cut 2,500 jobs globally, it said it would “significantly reduce our UK staff” and close offices including those in Spain, Sweden, Germany.

An AOL Europe spokesperson tells paidContent:UK: “As far as operations in Europe are concerned, we remain focused on building the premiere content network on the web (creating and distributing premium digital content and connecting advertisers with relevant audiences at scale).

“We continue to execute on our strategy for 2011 by creating original content (recent deals with Dannii Minogue and Christopher Kane), acquiring companies that fit squarely into our strategic growth areas (goviral) and partnering with the best content brands in the business, all to provide the best consumer experience possible and increase profitability.

“Recent acquisitions such as goviral support this strategy, bridging the gap between the creation of quality content and the capability to distribute (premium) content at scale. goviral also takes us back into Europe – supporting our existing presence with healthy and profitable business operations in France, Germany, Denmark, Sweden and Spain. We continue to focus efforts on this integration.

“Moving forward, our focus in India will be on our core capabilities around building the most compelling consumer facing products primarily for the Indian and other Asian markets. We’ll be partnering with (outsourcing firm) Mindtree and HP (NYSE: HPQ) to round out our business operations.”

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