Globalstar LP to cut staff by 20%

(Telephony) Globalstar Telecommunications LP will cut its staff of about 400 by 20%, eliminating about 80 jobs in the process, most of them in sales and marketing, with some coming from the company’s technical staff.

Virtually all of the cuts will come from the company’s San Jose, Calif., headquarters. The company’s regional partners, including Globalstar USA, will not be affected.

According to a company spokesman, the job cuts were not unexpected and in fact are part of Globalstar’s overall plan to concentrate its effort on the buildout of its system.

“We are simply moving the sales and marketing function to our franchises; this was the game plan all along,” said the spokesman. “The plan is for the corporation to build the system, and then let our partners sell it. They know best how to sell and market wireless service.”

While the job cuts may have been expected, the timing was less so, acknowledged the spokesman. The company has chosen to make the cuts now to conserve cash and streamline operations, a necessity given that Globalstar’s business hasn’t grown at the pace originally expected, he said.

“This in no way will impact our overall operations, but we have had to build a slightly longer runway to profitability,” the spokesman explained. “We still believe Globalstar will be successful. It’s just taking longer than we envisioned.”

Globalstar miscalculated how long it would take to find and reach its core target market, which includes forestry operators in Canada and off-shore oil diggers on rigs around the world, the spokesman said.

“In hindsight, we should have allowed more time,” he said. “But we still think we’re going to get them.”