Metricom cuts workforce by 22%

(Telephony) Mobile wireless data network operator Metricom has laid off 179 employees, or 22% of its workforce, as it struggles to find financing before the second half of the year.

Metricom, which has about 800 employees nationwide, said last month it may cut some jobs in an effort to reduce its negative cash flow. It is also slowing down its deployments of its 128 Kb/s wireless Internet services marketed under the Ricochet brand.

The company also announced the resignations of Chief Financial Officer James Wall and Robert Mott, senior vice president of engineering and manufacturing. David J. Pangburn, Metricom's long-standing corporate controller, will assume the CFO role.

The departures follow the resignation of CEO and Chairman Timothy Dreisbach who left last month after the company reported lower-than-expected results.

"We remain confident that our technology enjoys a competitive speed and cost advantage that we have yet to exploit," said Ralph Derrickson, Metricom's interim chief executive officer.

Analysts are worried the company will face strong competition from mobile operators rolling out higher speed data networks with bigger footprints.

"The wireless operators in the next few years will roll out the same network and already have the customer base to sell to," said Larry Swasey, vice president of the communications research practice with Allied Business Intelligence. "They know that most of their customers will be qualified leads that they have combed from their own databases. … Unfortunately, Metricom deployed its service at the beginning of the wireless data curve, and that can account for slow subscriber additions and the cherry-picked network deployments."