March 15, 2001

See yesterday's announcement in ComputerWorld.

(,1199,NAV47_NLTam_STO58603,00.html) to cut free service, reduce staff


(March 14, 2001) Inc. will no longer provide information at
its Web site for free and instead will begin a subscription service for
its online content as part of a restructuring announced yesterday.

As part of the reorganization, the company will lay off 68 of its 220
employees, most of whom work in Chicago. The cuts begin this week and will
continue through June, according to a company statement. This is the
second round of layoffs at the Chicago-based company. In November, 75
employees lost their jobs.

In addition, the company will heavily market other pay services, such as, for students in kindergarten through high school.

The news comes less than 18 months after launched its free
service to an information-hungry online public (see story).

A crushing surge of 10 million visitors forced the site to temporarily
shut down when it first went online in October 1999 (see story), but that
success apparently hasn't translated into monetary success for the
subsidiary of Luxembourg-based Encyclopaedia Brittanica Holding SA.

Like many Internet pure-plays, planned to raise revenue
through advertising. With the Internet advertising business in a decline,
however, the company had to look for new revenue sources.

"There was a time not along ago when most observers believed that Internet
services had to be supported mainly through advertising," said Don
Yannias,'s CEO. "We are out there in the marketplace,
however, and we're convinced that a diversified business model combining
free and subscription-supported products is the road to success."

Brittanica was the first encyclopedia on the Internet when it launched
with a paid, subscription service in 1994.