AOL To Cut 2,000 Jobs, Including 1,200 In U.S., As Part Of Transition

NEW YORK, NY.(AP) – AOL is reducing its global work force by 2,000 employees, or 20 percent, as it continues a transition from Internet access provider to online advertising company.

The latest round of job cuts comes on top of 5,000 positions eliminated last fall, after AOL said it would begin giving away AOL.com e-mail accounts, software and other features once reserved for paying subscribers to boost traffic to ad-supported Web sites.

“This realignment will allow us to increase investment in high-growth areas of the company – as an example, we added hundreds of people this year through acquisitions – while scaling back in areas with less growth potential or those that aren’t core to our business,” AOL Chief Executive Randy Falco told employees Monday.

The cuts affect about 1,200 positions in the United States, including 750 in northern Virginia, which has long been AOL’s headquarters. AOL, a unit of Time Warner Inc., recently announced it was moving its headquarters to New York to be closer to the media advertising industry.

Most of the U.S. employees affected were to be informed and terminated Tuesday, while reductions abroad were expected by year’s end. Severance packages are to include at least four months’ pay.

Last year’s reductions were mostly in customer-service and marketing personnel as AOL opted to stop producing and distributing its famous trial discs aimed to luring new customers to its Internet access subscriptions. The latest cuts were expected to affect employees across the board.

By ANICK JESDANUN AP Internet Writer

(Copyright 2007 by The Associated Press. All Rights Reserved.)