NBCi cuts staff by 20%

Key to future lies not in head count but in redefining NBCi

By Ken Kerschbaumer -- Broadcasting & Cable, 8/14/2000

NBCi cut its total staff 20% last week, from 850 to 680, in an effort to pare costs as part of an initiative announced in June to integrate all of its consumer properties under the NBCi.com brand.

"We're in the middle of some cost-cutting initiatives that we publicly said we'd undergo, and some positions have been eliminated, while other employees have been reassigned within the company and others have been let go," says Robert Silverman, an NBCi spokesman. "We feel the move will help move us to a more competitive cost structure and keep us more healthy."

But the bigger problem is where the company is headed, not how many people are working there. "They're spending bucketloads of money on marketing, and laying off someone in the finance department isn't going to solve that problem," says David Card, Jupiter Communications director of content and programming. "Although they should definitely lay off that poor person, because they shouldn't have that many people working there."

Silverman says the company is still on target for launch of an NBCi portal to coincide with the start of the prime time season this fall (which will be pushed back due to the Olympics), and that the company, with more than $680 million in both cash and NBC ad credits in the bank (just over $350 million of that is cash) is financially healthy.

Card, however, says that if NBCi simply rebrands the Snap.com portal as NBCi, it won't succeed against the likes of Yahoo. He thinks NBCi would be better off if it offered a portal for a more specific group of topics or general-purpose topics for a more specific audience. "They haven't said what they're going to do, but if they stay where they are, they're going to die," he says. "There's no business model for a second-tier, general-purpose portal."