Layoffs at eMusic

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It could be another difficult year for eMusic.

Over the weekend, we heard rumblings of layoffs, and just this morning, the company confirmed a dump-off of 9 employees.  The pare-down happened in early January, according to eMusic Director of PR and Communications Tiffany Guarnaccia, who was eager to downplay the significance.  “We made some minimal changes that affected nine members of our staff two weeks ago,” Guarnaccia told Digital Music News.

The company currently counts 70 employees, which puts the pare-down at about 11 percent.  In other words, not catastrophic, though also not a sign of healthy, continued growth.  One laid-off employees is continuing as a consultant, according to the company.

The move closely follows a significant site relaunch and another restrategization, though it seems this company is struggling to establish its presence and attract serious subscribers.  Part of the problem could be positioning: in 2009, eMusic decided to branch away from its indie-focused niche, though adding major label content was expensive and potentially alienating to the core subscriber.  In late 2010, an eMusic executive pointed Digital Music News to a subscriber total of 400,000, which represented zero growth since 2007.

This time around, eMusic is refusing to disclose its subscriber numbers, which seems to raise even more flags.  That tight-lipped stance suggests that eMusic is still struggling with zero or negative subscriber growth, a situation potentially exacerbated by Spotify and broader economic pressures.