Akamai to cut 110 jobs

CDN market leader Akamai announced extensive job cuts Thursday, saying it would eliminate around 110 positions -- 7 percent of its workforce. The company said the cuts will be part of a restructuring aimed at lowering the company's expenses, due to the worldwide economic downturn.

Akamai did not reveal where the cuts would be made, but it's likely that a good portion of them will come from the company's headquarters staff of about 650. It said the cost of the severance program will be around $4 million, to be assessed in the fourth quarter.

Akamai spokesperson Jeff Young told the Boston Globe, "Our goal is to continue investing for growth despite the current economic climate."

The company has continued to grow profits, which makes the cuts even more interesting. Akamai's profit in the third quarter was up 37 percent to $33.4 million on revenues of $197.3 million. Akamai also had the cash to dole out for targeted ad firm acerno just last month.

It's not a good sign for the CDN space or the online video economy in general to see Akamai shedding jobs. Intense price competition with other players in the space like Level 3 and Limelight is probably as much to blame as the economy for Akamai's need to restructure.

For more:
- the Boston Globe has an article on the job cuts 

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