HookMedia has closed its Atlanta office and cut staff at its headquarters here.
About 10 employees at the office were told they were being let go and were given two weeks severance pay, sources said.
Caroline Ernst, an agency principal who had helped run the Atlanta office, referred questions to Don Epperson, president and founder of the Boston-based independent interactive media firm. Epperson did not return calls.
A statement issued Wednesday by Epperson's office said, "In light of the current downturn in the interactive media market and anticipated weakness throughout the rest of the year, HookMedia restructured operations refocusing its efforts on client service and profitability. As a result, its Atlanta operations were discontinued."
The statement went on to say that HookMedia had also "reduced headcount in supporting functions in the Boston headquarters," but did not elaborate. The agency's New York office, which will service some undisclosed business that had been handled out of Atlanta, was not affected.
Agency staffing nationwide before the cuts was believed to be slightly more than 100.
HookMedia launched in Atlanta with five employees in July. The firm worked on various assignments with area shops Adair-Greene and Interactive Planet, but lately progress had stalled in terms of expanding on that base, sources said. Those let go in Atlanta are seeking employment elsewhere; none have been offered jobs in Hook's offices in Boston or New York, sources said.
The agency had an nounced plans to expand to Chicago and Los Angeles; it could not be determined if management still considers such launches viable.
HookMedia had been one of the region's hottest startups in recent years, growing from about 20 employees a little more than a year ago. The company was founded by Epperson almost three years ago inside Pro Media, an offline media buying company in Natick, Mass. [Adweek, March 20]. HookMedia spun out of Pro Media in 2000.