RealNetworks is laying off 39 people in Seattle, the company said Thursday.

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RealNetworks is laying off 7 ½ percent of its work force, including 39 people in Seattle, the company said Thursday.

The Seattle-based digital-media company cut jobs in all divisions throughout the U.S., Europe and Asia. In an internal e-mail to employees, Chief Executive Rob Glaser called the move a “reflection of the current economic downturn.”

“While our business has not been affected as much as many, we are not immune to what’s going on in the wider economy,” he wrote. “In order to stay healthy, we need to get our costs in line with the business as it looks today.”

Those let go will get pay through the end of the year, a cash severance based on length of service and six months of paid COBRA health benefits, said spokesman Bill Hankes.

Noting the difficult environment, Real doubled the time it usually pays for health benefits, he added.

Glaser told employees that many of the reductions result from “consolidations of operations of companies we’ve acquired in the past year or so that are being integrated with other parts of our business.”

Real also looked across the company to merge similar job functions and groups, he said.

Glaser said Real remains “well-positioned to weather the current economic storm. As per our last earnings call, we expect to achieve record revenue for the year and we still see opportunities for growth and investment across the business.”

In its most recent financial report, for the quarter ended Sept. 30, RealNetworks reported sales of $152 million and a net loss of $4.5 million, or 3 cents a share.

For the full 2008 fiscal year, the company said it expects sales between $602 million and $609 million, and a net loss per share of 3 to 6 cents.

However, it noted its fourth-quarter and full-year results “are more difficult than usual to predict in light of the high level of uncertainties regarding consumer spending, global economic trends, foreign-exchange rate fluctuations, credit markets and corporate valuations.”

After the layoffs, Real will have 1,670 employees remaining, including 778 in Seattle.

Glaser said the company is tightening its belt in other ways too, including travel, and canceling its holiday party in Seattle.

Kristi Heim: 206-464-2718 or