Heavy, an online video play that caters to the Maxim crowd, has laid off 25 employees or about 22 percent of the company's workforce, a spokesman said Thursday.
Heavy said earlier in the week that it planned to spin off its online video ad network division. Rafat Ali at PaidContent.org, who broke the story about Heavy's layoffs, wrote that CEO Simon Assaad told him the layoffs were "a result of this spinoff, where the company realized some of the projects they were working on were not needed."
I read that as Heavy not being able to sell enough ads to keep these people around.
The layoffs come as YouTube and the major TV networks appear to be sewing up the Internet video market. It's going to get tougher for smaller video sites to attract ad dollars when they have to compete against the likes of CBS and Hulu, the video portal created by NBC Universal and News Corp.
A spokesman for Heavy declined to say what led to the downsizing. In a statement issued by the company, Heavy said the move was made to make it "more efficient and profitable."