AOL lays off 450 California employees

America Online consolidates its operations in the state, cutting about half its software development positions and shuttering two offices.

Paul Festa Staff Writer, CNET News.com
Paul Festa
covers browser development and Web standards.
Paul Festa
In an attempt to streamline its business, America Online on Tuesday consolidated its California operations, cutting about half its software development positions and shuttering two offices.

Of the 450 people who lost their California jobs, 375 were in Mountain View, 50 in San Francisco, and 25 in San Diego. The layoffs affect more than 2 percent of the company's total work force of about 19,000 employees.

AOL offered 100 of the affected workers employment in its Dulles, Va., and White Plains, N.Y., offices. No senior management positions were included in the layoffs.

AOL said the San Francisco and San Diego development offices will close by the end of the year. About 75 developers will remain in AOL's Irvine office for southern California, and about 300 will remain in Mountain View in Silicon Valley, in the northern part of the state.

AOL said the laid-off developers were working on a broad range of projects including streaming media, electronic wallets and address books.

Remaining developers were concentrated in projects such as voice services, calendars, radio and AOL Communicator.

A company representative said the layoffs were part of AOL's ongoing efforts to manage costs.

AOL in July laid off 50 developers at its Mountain View-based Netscape Communications unit. The company has been under intense pressure to improve its performance after dragging down the earnings and stock price of Time Warner, which merged with AOL to become AOL Time Warner before dropping AOL from its name this year.