Over here, one of the toughest businesses to be in is providing Internet services, particularly to the consumer. And with the news today that EarthLink is beginning to implode after being one of the first companies in that particular space. For more than thirteen years the company has persevered through the painful transitions of the Internet service provider market, growing a respected dial-up access business, then fighting, more successfully than many, to survive the transition to broadband and the onslaught of huge competitors.
But the past few years have been rough (they lost $16.3 million in the last quarter), and when axe-man CEO, Rolla P. Huff, took the helm in June, it was apparent things would need to change. Today they did. EarthLink announced it would be cutting 900 jobs -- about half its workforce -- and closing offices in San Francisco; Orlando, Fla.; Knoxville, Tenn.; and Harrisburg, Pa.
More cuts may follow, and the company will also "substantially reduce its presence" in Atlanta and Pasadena. As part of the restructuring, EarthLink will also buy back $200 million of its stock. "We see this as an important first step in unlocking the underlying value that we believe is in our company," Huff said. "These changes get our cost structure in line, but there is much more to do." In other words, there's a lot more blood to run over this particular dam.
George Parker
Blogging for:
Member since: 03 Jun 2008
Last login: 17 Nov 2009
Total Posts: 831
