Heavy layoffs hit Second Life parent company

Nearly a third of virtual world company Linden Lab has been let go as part of corporate restructuring aimed at bringing niche "Second Life" into the mainstream.

Caroline McCarthy Former Staff writer, CNET News
Caroline McCarthy, a CNET News staff writer, is a downtown Manhattanite happily addicted to social-media tools and restaurant blogs. Her pre-CNET resume includes interning at an IT security firm and brewing cappuccinos.
Caroline McCarthy
2 min read

Linden Lab, the San Francisco-based company that manufactures virtual world Second Life, announced on Wednesday that it's going through a "strategic restructuring" that will see about 30 percent of its employees laid off. The company is combining its engineering and product divisions into a single unit, among a few other structural modifications like an overhaul of Linden Lab's customer service team.

"We've emerged from a two-year investment period during which, among other things, we've spent a considerable amount of time improving reliability and the overall user experience," said CEO Mark Kingdon, who took over from founder Philip Rosedale when he stepped down two years ago. "Today's announcement about our reorganization will help us make Second Life even simpler, more enjoyable, relevant and engaging for consumers starting with their first experience. It will also enable us to invest in bringing 3D to the Web and will strengthen our profitability."

That last line is important: Second Life is, or at least has been, a profitable piece of software for some time now. Though it never became the next big Internet sensation the way marketers were predicting three or four years ago, a devoted base of hardcore users have kept it more than afloat and have been making very real purchases of virtual goods.

CNET met with Kingdon last month to hear about the status of the company, and Kingdon said at the time that Linden Lab had about 350 employees and that 100 had been added in the past year. And he spoke of hiring, not layoffs. "We're hiring all over, although our largest office presence is in the Bay Area," he said at the time, noting that the company has about a half dozen offices around the world including in Singapore, Amsterdam, and Seattle.

But he didn't seem content with Second Life's position as the domain of hardcore geeks, subculture enthusiasts, and digital designers. "To me, the Web is crying out for a third dimension," he said at the time.

Linden Lab still has open positions listed on its online job board.