Kara Swisher

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RealNetworks to Lay Off Four Percent of Staff Today

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The Seattle area is going to get another jobless jolt today, with RealNetworks planning to lay off four percent of its workforce, sources said.

That’s a small number–just about 70 people out of its 1,700-person staff–but the move comes on the heels of layoffs of another 800 employees at nearby Microsoft yesterday.

The software giant has cut thousands of jobs over the last year, part of a move to eliminate 5,000 positions by mid-2010.

While the dismissals–which are likely to be announced by managers to affected RealNetworks (RNWK) employees sometime this morning–will be global, both companies are tech leaders with headquarters in the Pacific Northwest.

According to sources, the reasons for the layoffs at RealNetworks are, as was the case at Microsoft (MSFT), to realign the workforce after the recent economic downturn and to control costs.

But RealNetworks could also hire back some of the laid-off employees, as other parts of the company are expanding.

The company had signaled the possibility of staff cuts previously, but had not been specific.

The last staff cuts at the company, which makes digital media software and tools, were larger, about 130 employees sacked about a year ago.

RealNetworks announced better-than-expected third-quarter earnings last week, barely returning to profitability by cutting costs to make up for weaker revenue.

(Digital Daily’s John Paczkowski contributed to this report.)


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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work