This story was written by Keith Dawson for the Industry Standard's Media Grok email newsletter. It is archived here for informational purposes only because The Standard's site is no more. This material is Copyright 1999-2001 by Standard Media.

Easy Dot-Com, Hard Dot-Go
Jan 05 2001 12:00 AM PST

Wall Street has a new lease on life, but in retail, advertising and media, the sad stories continue.

Neither the new year nor the stock market's Greenspan-inspired surge brought any relief from dot-com doom and gloom. Today's media were riddled with news of layoffs at eToys (ETYS), Engage (dossier), News Corp. and others.

EToys, after a dismal holiday season, is withdrawing from Europe, closing two regional distribution centers and laying off 70 percent of its staff. The New York Times and the San Jose Mercury News ran parallel stories - both quoted eToys CEO John Barbour and both contrasted the company's dismal prospects with those of its biggest rival, Toysrus. Working with partner Amazon.com (AMZN), Toysrus had actually posted a year-to-year gain in sales for the holiday season, edging out last year's champion eToys.

Engage, the Internet advertiser that has been the crown jewel of the fading holding company CMGI (CMGI), announced it will cut half of its staff to stretch its cash until the company turns profitable later this year. (Hey, at least it's got positive cash flow in sight.) The Wall Street Journal quoted an approving Bear Stearns analyst: "There were so many companies rolled up into Engage that doing what they did in terms of restructuring was the right thing." Everybody contrasted Engage's dismal stock price with its once high-flying valuation. Engage's local paper, the Boston Globe, offered more context: Hiawatha Bray noted the earlier layoffs by Engage rivals DoubleClick (DCLK) and 24/7 Media (TFSM), and Compaq's ownership stake in Engage.

The Journal and the Times reported Rupert Murdoch's decision to roll up New York-based News Digital Media and to reabsorb the functions of FoxNews.com, FoxSports.com and Fox.com back into their respective TV networks. The Times' Jayson Blair turned in an 1,100-word treatment that quoted anonymous staffers at News Digital Media as well as venture capitalists and Silicon Alley journalists. Anyone need office space in Chelsea? - Keith Dawson

EToys Slashes Staff by 70%
The Industry Standard

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EToys to Dismiss Most Employees and Close 2 Warehouses
New York Times
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EToys to Lay Off 70% of Workers, Close Two Warehouse Operations
Wall Street Journal
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EToys to Chop Workforce by 70% in Bid to Survive
San Jose Mercury News

Engage Cuts 550 Workers (Newsbytes)
Washtech.com

Engage Plans to Cut 550 Jobs As Part of Broad Restructuring
Wall Street Journal
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Engage to Lay Off 550 in Dot-Com Downturn
Boston Globe

News Corp. to Close Online Division, Cut Over 200 Jobs to Conserve Cash
Wall Street Journal
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News Corp. Plans Hundreds of Layoffs at Web Sites
New York Times
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