The AIM instant messaging service is widely used among businesses and consumers. But a new round of layoffs at AOL could threaten its future existence. More than 40 employees in the company's West Coast offices were notified on March 9th that their jobs were ending, with the AOL Instant Messenger (AIM) group being hit particularly hard. More layoffs are expected in the next few weeks.
An unnamed ex-employee reportedly told the New York Times that the AIM unit was "eviscerated and now only consists of support staff." The ex-employee, who the newspaper said was not allowed to speak publicly about the company, also noted that "nearly all of the West Coast tech team" has been let go.
'Very Difficult Changes'
The cuts are throughout the communication products team, and include Jason Shellen, vice president of AOL messenger products, who was also working out of the Silicon Valley offices. Shellen had sold his social software company Thing Labs to AOL in 2010, and his company's staff had become part of the online service.
Eric van Miltenburg, senior VP of business operations, is also rumored to be leaving. In addition, AOL is expected to layoff as many as 100 employees in its local news service, Patch.com, as well as other areas of the company.
In a statement, AOL said that it was "making some strategic but very difficult changes" to better align resources with key areas of growth for the company.
The NY Times story also quoted two employees "familiar with the Instant Messenger group operation" as saying that AIM is generating as much as $50 million annually in revenue. The newspaper reported that the company, as part of its cost-cutting, is hoping to get the cost of running the AIM unit down from $25 million a year to about $2 to $3 million, thus creating an additional $20 million or so in profit.
No Statement in Support
Interestingly, AOL recently invested in reinvigorating the product. In November, AOL revamped the user interface of the client, in order to streamline it, add more social media, and answer complaints that it had become too burdened with feature-itis.
Shellen was in charge of the overhaul, and the acquisition of his team and Thing Labs' technology was designed to pump new creative blood into that product and others.
However, some AOL observers have noted that the company has not come out with a statement voicing its strong support of AIM in the future -- which, in the industry, is often considered a sure sign of impending doom.
During its heyday, AIM was the king of the roost in instant messaging. But now, it has many competitors, including IM capabilities offered by Google and Facebook. As the financial struggles at AOL continue, AIM users may find their favorite messaging service hard hit.