What Does This Mean for the Ad Model?
I've had my doubts about the viability of a purely ad driven model, and I'm wondering whether the layoffs at Digg are a marker for that problem:
This morning we faced the difficult task of reducing our team by about 10%. This was an emotional and rough morning for everyone involved. Laying off dedicated and hard working individuals is extremely difficult, but we tried our best to treat everyone with the utmost respect and support.
It could mean plenty of other things as well; if they plan to go public soon-ish, or get acquired, that could also be the culprit - companies sometimes do strange things in the run up to that stuff. Back at ParcPlace in the mid 90's, we started turning down consulting work in order to make the percentage of revenue from product sales higher - because the lawyers taking the company public strongly urged management to do that. Weird stuff, never made sense to me - I kind of figured that money was all green regardless of where it came from :)
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