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Asian-American Web company trims staff, talks merger

aMedia lays off its staff in San Francisco and Los Angeles to trim its expenses in anticipation of a possible merger, according to sources familiar with the company's plans.

Asian-American magazine publisher and Web company aMedia has laid off its staff in San Francisco and Los Angeles to trim its expenses in anticipation of a possible merger, according to sources familiar with the company's plans.

The roughly 15 staffers in the company's San Francisco and Los Angeles offices were laid off Monday, the sources said.

The reduction resulted from cost cutting in anticipation of a possible merger, the sources added. While no deal has been officially sealed, sources close to the company said New York-based aMedia has been in discussions to merge with Los Angeles-based Click2Asia, an Asian-American Web community site.

Although most aMedia employees were eliminated this week, a select few were offered an opportunity to relocate to Click2Asia's Los Angeles office, sources said.

Sandra Cheng, director of business development for Click2Asia, would not confirm or deny the merger discussions. But she said the company is exploring partnership options.

"Currently we are in discussions with several (Asian-oriented) Internet, technology and media companies for strategic partnerships or mergers or acquisitions," she said.

Representatives for aMedia did not return repeated requests for comment.

aMedia is known for publishing A Magazine, which features Asian-American lifestyle content. But the company recently attempted to shift its business online. The company launched aOnline, a Web site focused on the Asian-American lifestyle, this summer after securing $4.5 million in financing.

April's Internet stock market downturn and the subsequent retreat by investors has forced many Web companies to pursue mergers or simply shut their doors. This week has been especially harsh, with the closures of some big-name Web companies including Pets.com, Furniture.com and MotherNature.com.

Other companies, such as Respond.com and Evite.com, laid off their staffs this week. Bigger companies such as Mortgage.com, Stamps.com and AltaVista have reduced their staffs as well.

For aMedia, the cutbacks mark the difficulty in creating a Web business focusing on the Asian-American market, an Internet-savvy but fractured demographic. Forrester Research in 1999 conducted a study that found 64 percent of Asian-American households are online. The study also showed Hispanic-American households at 36 percent, Caucasian-Americans at 34 percent, and African-Americans at 23 percent.

Previous attempts to tap Asian-American Web surfers have not succeeded. Two years ago Channel A shut its doors after undergoing a transformation from an editorial features site to an online retail site for Asian lifestyle products. The company cited a lack of funding as the reason for its demise.