Downsizing strikes Seattle dotcoms

Associated Press

SEATTLE — It has been a rough week for Seattle’s Internet industry, with three companies laying off a total of 173 workers in two days.

It started Wednesday when Gear.com laid off a third of its work force and its president resigned. An estimated 23 positions were lost.

On Thursday, two more companies announced layoffs. Recently acquired OnHealth.com’s Seattle offices were all but shut down by its new parent company, WebMD, in a cost-cutting measure. About 65 employees lost their jobs.

And OnVia.com, despite having $180 million in the bank, laid off 80 workers in Seattle, 20 percent of its work force here, and another five workers in Vancouver, British Columbia. The company’s news release said the jobs were "redundant."

Though new companies continue to start up in the Seattle area, there have been more than 900 layoffs since May 31, according to published reports.

OnVia.com vice president Gretchen Sorensen said that despite the company’s fat bankroll, the layoffs were necessary for long-term profitability. OnVia.com, launched in 1996, has yet to turn a profit.

On Thursday, health Web site WebMD laid off approximately 65 people at recent acquisition OnHealth.com. Workers there were given severance and a chance to relocate to WebMD’s Atlanta offices.

WebMD said its consolidation efforts, including cutting 1,100 jobs nationally, would save $250 million a year. Shares of WebMD were up 44 cents to $14.44 Friday morning on the Nasdaq, coming on the heels of a 24.4 percent rise Thursday after the layoff announcement.

Gear.com, an online sporting goods retailer, also laid off about a third of its work force on Wednesday, about 23 people, and president Ken Blue resigned amid questions about the site’s growth.

In Gear.com’s case, the worry was about growing too fast to support itself.

"The cash lasts a lot longer in a smaller organization, and that’s what drove the restructuring," said Kevin Quigley, Gear.com’s vice president of marketing. Quigley and chief financial officer Joe Kenny took over the presidency.

Quigley said the company still had enough cash to operate into 2001, even without the layoffs. Gear.com received $12 million from investors in July.

Copyright ©2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Local News

Customers enter and exit the Costco on Dec. 2, 2022, in Lake Stevens. (Olivia Vanni / The Herald)
Costco stores could be impacted by looming truck driver strike threat

Truck drivers who deliver groceries and produce to Costco warehouses… Continue reading

Two Washington State ferries pass along the route between Mukilteo and Clinton as scuba divers swim near the shore Sunday, Oct. 22, 2023, in Mukilteo, Washington. (Ryan Berry / The Herald)
Ferry system increases ridership by a half million in 2024

Edmonds-Kingston route remains second-busiest route in the system.

A pedestrian struck and killed by vehicle Wednesday in Everett

The pedestrian was a man in his 60s. The collision happened at 5:30 a.m. Wednesday.

Want coffee? Drink some with the Marysville mayor.

A casual question-and-answer session between mayor and constituents is planned for March 24.

Judge sentences man for role in human smuggling ring

Jesus Ortiz-Plata was arrested in Everett in May 2024. A U.S. District Court judge sentenced him to 15 months in prison.

Robin Cain with 50 of her marathon medals hanging on a display board she made with her father on Thursday, Jan. 2, 2025 in Lake Stevens, Washington. (Olivia Vanni / The Herald)
Running a marathon is hard. She ran one in every state.

Robin Cain, of Lake Stevens, is one of only a few thousand people to ever achieve the feat.

People line up to grab food at the Everett Recovery Cafe on Wednesday, Dec. 4, 2024 in Everett, Washington. (Olivia Vanni / The Herald)
Coffee, meals and compassion are free at the Everett Recovery Cafe

The free, membership-based day center offers free coffee and meals and more importantly, camaraderie and recovery support.

Devani Padron, left, Daisy Ramos perform during dance class at Mari's Place Monday afternoon in Everett on July 13, 2016. (Kevin Clark / The Herald)
Mari’s Place helps children build confidence and design a better future

The Everett-based nonprofit offers free and low-cost classes in art, music, theater and dance for children ages 5 to 14.

The Everett Wastewater Treatment Plant along the Snohomish River on Thursday, June 16, 2022 in Everett, Washington. (Olivia Vanni / The Herald)
Everett water, sewer rates could jump 43% by 2028

The rate hikes would pay for improvements to the city’s sewer infrastructure.

The bond funded new track and field at Northshore Middle School on Thursday, Oct. 24, 2024 in Bothell, Washington. (Courtesy of Northshore School District)
Northshore School District bond improvements underway

The $425 million bond is funding new track and field complexes, playgrounds and phase one of two school replacements.

Bill Wood, right, Donnie Griffin, center right, and Steve Hatzenbeler, left, listen and talk with South County Fire Chief Bob Eastman, center left, during an Edmonds Civic Roundtable event to discuss the RFA annexation on Monday, Feb. 10, 2025 in Edmonds, Washington. (Olivia Vanni / The Herald)
Edmonds community discusses annexation into the regional fire authority

About 100 residents attended the Edmonds Civic Roundtable discussion in preparation for the April special election.

Timothy Evans, a volunteer at the east Everett cold weather shelter, with his dog Hammer on Monday, Feb. 10 in Everett, Washington. (Will Geschke / The Herald)
Temporary shelter opens in Everett during unusually cold weather

The shelter will open nightly until Feb. 14. Help is needed at the new location, as well as six others across the county.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.