AltaVista job cuts won't hit UK

UPDATE: Eighth most visited Web site finds portal competition tough going, but international expansion will continue unaffected

Struggling Web portal AltaVista will announce lay offs Friday in an effort to revitalise the company.

The layoffs will mark the second round of staff cuts for the company in five months, indicating the difficulties hundreds of Web portals are having to contend with in a saturated market.

AltaVista currently employs 900 workers all of whom were notified of the impending redundancies at a company-wide meeting Monday. Details of the positions to be axed were announced at the US headquarters Friday afternoon. AltaVista says however, that the UK offices of Web portal will not be affected.

"We will continue with our geographic expansion and we will roll out to more than 35 new countries in the next five months, starting with Denmark next week." says general manager AltaVista Europe Vesey Crichton. "AltaVista Europe continues to recruit aggressively to support sales, the existing and planned AltaVista sites, and new product development."

AltaVista ditched its UK unmetered Internet package last month amid a nightmare PR backlash which resulted in the then MD, Andy Mitchell resigning his post.

During the past year the company has tried to focus on the revamp of its search engine, launching a vertical search and navigation platform in August, providing power searches through customised search centres such as entertainment and news.

AltaVista was ranked as the fifteenth most visited portal in July by Internet research company Netvalue. "The portal market is very competitive, there are hundreds out there," says Nick Gibson, Internet analyst at research group Durlacher. He points to the huge diversity that exists between specific and generic search engines, and is doubtful that the traditional generic players will be able to make the transition to developing specialised vertical engines.

"There isn't a perfect search engine out there, and I don't think that there ever will be," Gibson added. He believes that in any crowded market there will always be a natural synergy that takes place. He expects that the portal sector will be thinned out in two ways; either through acquisition where the big players will buy out the smaller search engines, or by companies going bust where struggling portals like AltaVista will be unable to sustain profitability.

AltaVista was not available for comment at the time of going to press.

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