Money-losing Web portal lays of 25 percent of staff to achieve profitability

The money-losing Web portal AltaVista said Friday that it has laid off 225 people, or 25 percent of its work force, as part of a series of steps to achieve profitability. AltaVista, which is 80 percent owned by Internet incubator CMGI, said that it has "completed the realignment of its California operations to its Palo Alto headquarters and has reduced its work force 25 percent as part of recent steps to achieve near-term profitability." The Web portal, which lags well behind industry leader Yahoo! in advertising revenue, said that its North American operation intends to be profitable, excluding amortization expenses, in the quarter ending Jan. 31, 2001. Many of the people laid off Friday did content development work for the portal. AltaVista said that it would sharply reduce the amount of content that it produces and instead concentrate on providing Web search services. That strategy contrasts with Yahoo!, which started out as a search service and later diversified into providing its own content and aggregating content produced by other companies. AltaVista had about 17.4 million unique visitors last July, according to MediaMetrix, making it the eighth-busiest site on the Web. However, AltaVista lags behind Yahoo!, which had 49 million unique visitors that month, and competitors Lycos and Excite.