America Online 2010 Annual Report Download - page 17

Table of Contents
into high value sponsorships and targeted promotions aimed at defining our core value proposition to consumers. We also engage in meaningful marketing
partnerships that allow us to grow our audience.
Employees
As of December 31, 2010, we employed approximately 5,860 people, including approximately 1,200 related to Patch. Our employees are based in 15
countries around the world, including the United States, India, the United Kingdom, Germany, Ireland, Israel, France and Canada. At that time, the country
outside of the United States where we had the largest employee population was India, with over 800 employees. We completed a significant restructuring
initiative in the fourth quarter of 2010, which began late in 2009 and we reduced our total workforce by nearly one-third, prior to hiring of new employees in
areas of strategic focus, including Patch. As part of this initiative, we reduced our cost base in the United Kingdom and ceased or reduced operations in a
number of other countries including France and Germany. We continue to undertake various restructuring activities in an effort to better align our
organizational costs with our strategy. A significant number of our international employees support our domestic operations. In general, we consider our
relationship with employees to be good.
Global Presence
As of December 31, 2010, we had AOL-branded and co-branded portals and websites in North and South America, Europe and the Asia Pacific region.
A Spanish language portal, http://latino.aol.com, is accessible in primarily Spanish-speaking regions. We offer Internet access service under the AOL brand in
the United States, Puerto Rico and Canada and have advertising operations in the United States, Canada and Europe, as well as in Japan through a joint
venture with Mitsui & Co., Ltd. In addition, AOL provides consumer offerings, including Winamp and Shoutcast, internationally. We have also expanded our
international operations through the acquisition of goviral A/S, a company that distributes branded online video for media agencies, creative agencies and
content producers. As part of our recent restructuring initiative to better align our organizational structure and costs with our strategy, we reduced our cost
base in the United Kingdom and ceased or reduced operations in a number of other countries. Specifically, we significantly reduced our presence in Europe by
reducing our operations in France and Germany and ceasing operations in a number of other countries. For geographic area data for the years ended
December 31, 2010, 2009 and 2008, see "Note 1" in our accompanying consolidated financial statements.
Seasonality
In the fourth quarter, we have historically seen a sequential increase in advertising revenues associated with holiday advertising; however, this
fluctuation can be offset by adverse economic conditions. Additionally, in the first quarter we have historically seen a sequential increase in average monthly
churn of domestic AOL-brand access subscribers (the number of subscribers that terminate or cancel our services, factoring in new and reactivated
subscribers).
13