Sheep to the slaughter

The Electric Sheep Company, a virtual worlds agency, is laying off 22 employees as part of a major restructuring effort.

The company will shift focus from managing small projects to bigger marketing and technology efforts, according to ClickZ.

Among the canceled projects was an ad network in Second Life, which the company scrapped because SL's current user base was not considered a big enough opportunity for large companies.

Though Electric Sheep was made popular from its projects in Second Life, it claims more than half of its projects have taken place outside the virtual space.

In 2008, Sheep will focus on other adult virtual worlds such as Icarus and Metaplace, in addition to kid-focused worlds.