UPDATED: LiveJournal announces mass layoffs

Posted at: 4:55pm 6th January 2009 by Ben Hardwidge

Has the social networking bubble burst?

One of the original personal blogging sites, LiveJournal has been a popular site with everyone from teenagers and goths to travellers and diary-keepers since 1999. However, the extremely popular social networking site has now announced a number of layoffs, including its vice president, resulting in speculation that the popular social networking site is now running on borrowed time.

A spokesperson for LiveJournal confirmed to Custom PC that ‘there were layoffs announced yesterday at LiveJournal as part of a restructuring.’ The official line is that these were a part of a program to ‘effectively manage costs in light of the global economic downturn.’

LiveJournal Inc hasn’t confirmed the exact numbers, but ValleyWag reports that 20 of the 28 staff at the San Francisco office have been laid off, while other sources (WARNING: strong language) say that the figure is somewhere around 13. According to the fiancé of a LiveJournal software engineer who was laid off, the staff were offered no severance package or an advance warning about the restructuring.

LiveJournal’s headquarters will remain in the US, along with the servers, a customer service team and the legal and admin staff, but the ‘global product development and design’ of the site will now be coordinated in Moscow. LiveJournal Inc claims that this ‘will allow the company to build a stronger business model, well positioned to guarantee the long-term success of LiveJournal.’

The cuts at the company appear to be very serious, and one victim was Matthew Berardo, the vice president and general manager of the company who was poached from Yahoo!. According to LiveJournal Inc, Berardo ‘will be leaving the company along with other valued colleagues.’ The company will now be led jointly by Stephanie Gravelle, LiveJournal Inc’s current director of finance and administration, and Sergei Komarov, currently CTO of SUP (the owner of LiveJournal).

Originally started in 1999 by Brad Fitzpatrick, LiveJournal was later sold to the blogging software company Six Apart before it was then sold on to the Russian media company SUP for a reported sum of $30 million US.

UPDATE: A spokesperson from LiveJournal has now confirmed to us that 'ValleyWag's figures are innaccurate,' adding that 'the actual number of layoffs at LJ was about a dozen, which is less than 20% of the entire LJ workforce.' We assume that this means the global workforce, as opposed to just the office in the US. Also, a source close to the circumstances has informed us that the information published here is 'pretty accurate.' Titled 'LJ in 2009 -- The Grim Purge,' the site lists the known redundancies and the known remaining staff, as well as confirming that the staff were given 'no advance warning and no severance.'