MTVi GETS A LITTLE SMALLER

As expected, MTVi, the Internet arm of MTV Networks, has reorganized, cutting its editorial, technology and marketing staff by approximately 25%, laying off 105 employees of its 400 employeesin the process.

"We are reorganizing MTVi Group to be more efficient and to get to profitability sooner," MTVi Group President/CEO Nicholas Butterworth told inside.com. "We've had great organizations, but there's been redundancy."

The editorial and technology departments will be consolidated, while marketing will be absorbed into MTV and VH1. In addition, the channel's four separate news divisions will be folded into a single entity that has a much closer relationship to MTV News, with MTVi existing mainly to distribute that content online. Executives maintain that MTVi will remain as a separate division within MTV Networks, though the status of SonicNet could be in doubt.

Several editors, like veterans Billy Altman, Richard Gehr and Jim Macnie, have been asked to stay on as a transition team, though it is unclear whom they will be reporting to or for how long they will remain.

The reorganization is aimed at bringing the Internet unit closer to the programming department. MTVi will continue to receive $100 million worth of promotion on MTV Networks channels over the next five years.

As reported earlier, MTVi had put off the IPO it originally filed forin February after it showed no signs of profitability while the tech market took a severe downturn. The division was originally launched last year to oversee 22 individual music Web sites, including the online efforts of MTV.com, VH1.com and SonicNet.

"The role of the MTVi Group remains the same, to lead in the space and maintain a close connection to the networks, but maintain autonomy as an Internet company," MTV Group President Judy McGrath told CNET News. "Anybody wanna buy some MP3.com stock cheap?"

An MTVi spokesperson insists the company's business strategy "has been a success to date," pointing to a rise in revenues from $18.2 million in 1999 to more than double this year, with page views going from 80 million a month last year to 170 million a month this year. Unfortunately, the company had a net loss of $46.4 million last year.

"Of course, it's never easy to lay off a portion of your staff. But these moves are about us being here in the long-term. By the way, are there any job openings over there?"