Britannica.com Inc., which launched a free Web site(www.britannica.com) with great fanfare in October 1999, will now ask users to pay for certain content.
The Chicago-based digital-media unit of Encyclopaedia Britannica Holding SA, Luxembourg, is also laying off 31% of its U.S. workers, or 68 people, as part of a restructuring that puts “a new emphasis on subscription-supported products,” according to a statement.
This is the latest effort at the closely held company to find a profitable business model. Britannica originally planned to make money from corporate sponsors and commercial links, and its debut was widely considered a raging success at a time when “eyeballs” were more highly prized than revenue.
Britannica’s computer servers were overwhelmed on launch day by millions of people seeking free access to all of Encyclopaedia Britannica’s digital assets — along with original content prepared by a staff of editors and writers. Britannica had been available online since 1994, but only through paid subscriptions and site licenses.
As enthusiasm for online advertising waned, however, Britannica was forced to revise its strategy. Last November, the company slashed 75 jobs, or roughly 20% of its staff, as it eliminated the original content. At the time, Britannica said it was refocusing “on aspects of the site that generate the greatest traffic and customer and advertiser value, with the goal of accelerating the date at which the company becomes profitable.”
But the changes late last year apparently weren’t enough. In February, Britannica closed its San Francisco office, laying off nine employees, to centralize operations.
A Britannica spokesman said the latest round of job cuts, which started this week and will be completed in June, reflect a reduction in topical features as the company’s emphasis shifts to reference, education and learning content. The spokesman said Britannica will decide “in the next couple of months”which information will be free and which will be subscription-based.
One paid service has already been announced: BritannicaSchool.com, a Web-based resource for the K-12 market, will go online this summer with encyclopedias, interactive curriculum materials and other educational tools.
A person close to the company said another option under consideration is moving all the Encyclopaedia Britannica content back into a paid service. “I can’t categorically rule it out,” the spokesman said. “I think everything is being looked at.”
Copyright (c) 2001 Dow Jones & Company, Inc. All Rights Reserved.
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