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AOL is set to eliminate more than 700 jobs at its HQ in Northern Virginia, according to the Washingston Post. It reports that the cull, due in early December, is necessary as the internet giant continues to cut costs as it battles to cope with the slide in customer numbers. Although no formal announcement has yet been made, it seems that speculation is growing after staff at AOL were told to prepare themselves for a new round of job cuts.

In March AOL warned that the "significant" erosion of subscriber numbers looks set to continue as the internet giant faces stiffer competition from broadband and cheaper dial-up services. In its annual report filed with the US's Securities and Exchange Commission (SEC), AOL reported that the number of subscribers in the US fell by 2.2m in 2003, from 26.5m at the end of 2002 to 24.3m at the end of 2003.

AOL blamed the decline on an exodus of punters from its service and poor uptake to its marketing campaigns, as consumers opted for rival dial-up services or shifted to broadband instead.

Said the company in its report: "The AOL narrowband (or dial-up) service experienced significant declines in US subscribers, which is expected to continue. Driving this decrease was the continued industry-wide maturing of the premium narrowband business, which is expected to continue, as consumers migrate to high-speed broadband or lower-cost dial-up services."

In December last year AOL announced plans to axe 450 workers and close two offices in California in a move to trim its software development operation. ®

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AOL warns of falling revs as punters flee service

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