Google to Lay Off About 300 at DoubleClick
In the first sizable layoffs in its history, Google is cutting about 300 jobs from the American operations of DoubleClick, the advertising technology company that it acquired recently, according to a person with direct knowledge of Google’s plans.
The cuts represent about a quarter of DoubleClick’s American work force of about 1,200. The company has about 1,500 employees worldwide, and the chief executive of Google, Eric E. Schmidt, has suggested that job cuts would also affect DoubleClick’s overseas operations at a later date.
Google declined to confirm the number of layoffs.
In a statement, the company said: “Since our acquisition of DoubleClick closed on March 11, we have been working to match and align DoubleClick employees in the U.S. with our organizational plan for the business. As with many mergers, this review has resulted in a reduction in headcount at the acquired company.”
Google said it also planned to sell a DoubleClick unit, Performics Search Marketing, that helps marketers place ads on search engines, including those owned by Google and its main rivals, Yahoo and Microsoft.
“It is clear to us that we do not want to be in the search engine marketing business,” Tom Phillips, director of DoubleClick integration at Google, wrote on the company’s official blog. “At Google, maintaining objectivity in both search and advertising is paramount to our mission and core to the trust we ask from our users.”
The decision to sell Performics Search Marketing is not surprising, said Ellen Siminoff, chairman of search marketing company Efficient Frontier. Google’s job is to get paid as much as possible for the ads that appear on its pages.
“If you are a search marketing agency, your goal is to get the most for your customers’ money,” Ms. Siminoff added, noting that those two goals could be in conflict.
Mr. Phillips said Google would retain the affiliate marketing portion of the Performics unit, which helps advertisers establish networks of Web sites that can refer customers to them.
Mr. Phillips did not identify a buyer but said he had “received preliminary interest” from a number of Google’s existing partners.
Some DoubleClick employees are being laid off Wednesday, while others are being offered transitional roles, Google said. The transitional roles are expected to end after the two companies are fully integrated, said the person with knowledge of Google’s plans.
The cuts follow Google’s largest acquisition ever and were widely expected. But the number is higher than some analysts predicted and suggests that Google, which has hired aggressively in the last several years, may have become more cautious.
“This obviously flies in the face of the notion that Google is managing for continuing excess growth, not only in operations but also in work force,” an equity analyst with Standard & Poors, Scott Kessler, said.
Others, however, noted that 300 employees was not “material” given Google’s size.
“It shouldn’t be surprising to see some head count reduction, given the areas of overlap between the two companies,” an analyst with Cantor Fitzgerald, Derek Brown, said.
Google added more than 6,100 workers in 2007 and ended the year with 16,805 employees worldwide. Amid shareholder concerns about its fast-rising expenses, Mr. Schmidt promised investors last year that Google would slow its rate of hiring.
Toyota close to deal for bigger stake in maker of Subaru cars
04/02/2008
Toyota Motor Corp. is near an agreement to buy 30 billion yen (about $295 million) worth of Fuji Heavy Industries Ltd. shares and raise its stake in maker of Subaru vehicles to 17 percent, sources said.
Toyota is already the top shareholder in Fuji Heavy Industries with an 8.7-percent stake.
The automaker is now considering buying an additional 64.23 million shares held by Fuji Heavy Industries, or about 8.2 percent of all outstanding shares.
However, Toyota will limit its stake to below 20 percent and refrain from sending officials to the Fuji Heavy Industries board to maintain the independence of the smaller automaker.
The two automakers will make official decisions on the deal by the end of this month after screening and approval by the Fair Trade Commission.
The deal will deepen their bilateral capital alliance and help Fuji Heavy Industries cope with rising costs for research and development, the sources said.
Toyota acquired its 8.7-percent stake in Fuji Heavy Industries in 2005 by taking over part of the 20-percent share held by General Motors Corp. after the struggling U.S. automaker severed its capital ties with Fuji Heavy Industries.
Under the current alliance, Fuji Heavy Industries started producing Toyota's Camry sedans at Subaru of Indiana Automotive Inc. in the United States in April 2007.
The two automakers are jointly developing new models, including a sports car.(IHT/Asahi: April 2,2008)
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