Hi5, the third largest social networking site in the world, has recently laid off almost 15 percent of its employees, a move to cut expenses in this gloomy economic condition where industries from all sectors including the Internet field have been experiencing dramatic financial slow down.
According to a high ranking official of the company, this move is an attempt to cut expenses in order to survive in this global economic crisis which had caused even the proud Wall Street to stumble upon its feet.
According to the latest figure, the company has also experienced low rates of unique visitors which had also forced some major sponsors to pull out their commercials and other kinds of advertisement posted in the webpage.
The reason for the financial throes experienced by most social network sites is the low advertising revenue which is just a domino-effect of a weak economic condition. Since most companies from all sectors are tightening their belt, advertising costs have been greatly reduced to reduce burn rates and limit expenses.
In a statement released by the company’s vice-president in marketing department Mike Trigg, “the move is a pragmatic decision in order to survive in this ever-changing environment, and in order for a business to grow, restructuring should be done in the company.”
Meanwhile a source who asked for anonymity had said that most of the people who had been laid off came from HR and Design department.
According to a recent survey, Hi5 ranks third from the most popular social network sites. The top placer is Facebook and then closely followed by MySpace, both of which have been considered as the most popular community sites in North America.
