Software vendor Commerce One Inc. will lay off 400 of its current 1,100 staff by the end of this year, the company said in a statement late Friday.

The 36 percent headcount reduction is in order to cut costs during the current market downturn, the company said in the statement.

Like many companies in the e-business software market, Commerce One, based in Pleasanton, California, has been undergoing a difficult year.

Revenue for the first six months of the year reached US$59.6 million, down 78 percent from the $271.6 million recorded in the first half of 2001. Net loss so far this year has totaled US$291.7 million.

In January, a major licensing agreement with SAP AG under which the two companies planned to sell each other's online procurement software fell through.

Early next year, the company will launch its new Commerce One version 6.0, a new suite of supplier relationship management Web services designed to boost enterprise sourcing and procurement applications. Actional Corp., Baltimore Technologies PLC, Cognos Inc., Contivo Inc., Sonic Software Corp., and VeriSign Inc. will all make technology contributions to the new Web services platform underpinning Commerce One 6.0.