Nick Denton laid off a bunch of people at Gawker today, and reshuffled a few more, and hired a few more. Most interesting about it, though, was his commentary about the layoffs he made in an email to the employees. Definitely refreshing in its honesty and candor, but I think it’s interesting, too, that Denton is wrestling with a few things I wrestle with a lot: how to make money on the internet, and how he’s coming to terms with the fact that it’s not just ad networks and content. I’ve been thinking about this for a while – how everyone is obsessed with what I’ve been calling “the algorithm.” Companies like Google and, to a lesser extant Flickr, and Livejournal and Digg make money magically, really, without lots of hard work. You’re considered a “hit” on the internet only if you find some way to make lots of money by doing less work. I’ve never really gotten this. It’s as if the financial world only placed value on Quants, and everything else was uninteresting. Anyway, it’s interesting seeing someone so nominally successful, with a payroll roughly equivalent to ours, I’ll wager, wrestling with these same issues.

I give mad props to their transparency, too. The layoffs were heavily covered by all the Gawker properties, and he gave permission to leak the letter.