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CNet plans layoffs after reporting loss

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San Francisco--Still struggling with the viability of online ads, CNet Networks Inc. posted a second-quarter net loss of $218 million and said it will lay off 15% of its staff, or 285 people.

The $1.60-a-share loss compared with a net loss of $167.9 million, or $1.24 a share, in the same period last year. CNet reported second-quarter revenue of $71 million, down 31% from $104 million a year earlier.

CNet CEO Shelby Bonnie said the company's outlook is good despite the bad news. "Though it's out of vogue we really believe Internet advertising works and will be more and more important going forward," he said in a statement.

Rick Segal, chairman-CEO of HSR Business to Business Inc., said CNet might be hurting more than other media companies because "we're still in the window of the novelty of online advertising." He added, however, that CNet "is one of the strongest online ad networks and will survive the downturn. It just depends on how long and how deep the valley goes." Segal said he didn't expect the market to come back until at least the first quarter of 2002. In early morning trading CNet shares were up to $10.30, after closing down 4.8% at $9.65 on Tuesday.

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