Music Netco ArtistDirect laid off 40 people, about 20% of its staff, on Thursday and announced it will reorganize into five business groups: a media group to focus on online activities, an e-commerce segment, a distribution group that will develop an online jukebox, a talent agency and a record label. According to chairman-CEO Marc Geiger, the company will suspend its broadband programming, offline fan clubs and pay-for-download initiatives.
“By separating the pieces, we believe we can focus better on what it takes to run each piece and on what level investment is needed,” he said.
This is the second round of layoffs for ArtistDirect, which pinkslipped 30 in November. Company, which is maneuvering to avoid being delisted from the Nasdaq due to its low stock price, closed down more than 8% to 69¢.