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AllAdvantage slashes work force by 100

In its second belt-tightening measure of the summer, the company--which pays members to surf the Web while they view advertisements--lays off about 18 percent of its staff.

In its second belt-tightening measure of the summer, AllAdvantage.com said it laid off about 18 percent of its staff today.

Roughly 100 employees received pink slips from the struggling company, which pays members to surf the Web while they view advertisements. AllAdvantage executives said this is one facet in the company's efforts to reach profitability.

"As the business climate on the Internet has changed, we've changed with it," chief operating officer Jacques Clay said in a statement.

"We are lean and mean and in position to grow the company to market leadership," said Clay, who joined the company in July.

The Hayward, Calif., company attracts new members by offering daily sweepstakes, promotions or cash to people who use its browser to surf the Web and allow the company to collect personal data about their online shopping habits. Advertisers then pay the company to reach people interested in products they sell.

Today's layoffs came from all areas of the company. The layoffs follow another set of staff cutbacks by AllAdvantage this summer. In mid-July, the company laid off 60 people, or nearly 10 percent of its staff. At the time, it said it employed 600 internationally.

Since the market downturn in April, the company has struggled to find willing investors and alternate sources of revenue. Its large membership base quickly caused the company's costs to outweigh its revenues. For example, in the first three months of the year it paid $32.7 million to members but pulled in only $9.1 million.

As a result, AllAdvantage took steps to improve cash flow. In June, it reduced the number of hours it pays members to surf the Web and lengthened its pay schedule. This month, the company started offering members the chance to win a daily sweepstakes instead of getting paid daily to surf. It also formed an ad network to sell space on third-party sites and formed partnerships to sell members low-cost products and services.