I hate to be a Chicken Little about wireless service provider, OmniSky. But the company is literally hanging in mid-air Tuesday after the company failed to file its latest quarterly earnings report and gave no indication when it would.

Because of that, the company is prohibited to issue new shares of the company's stock untill it completes its required 10Q papers for Q3, according to Securities and Exchange Commission officials.

The San Francisco-based telecommunications company seems to have pulled a disappearing act lately with an extension request of its third quarter earnings paperwork last week and a no-show at this year's wireless-heavy Comdex conference.

A chance phone call inside the voicemail firewall confirms that the company is still open - but for how long?

The problem, according to OmniSky releases, is that the company is still evaluating its various options, including reorganization, a sale or some other form of restructuring under the federal bankruptcy code.

That may not be a shocker considering the recent slump in the telecommunications sector, but it does strike a drastic turn of events for a company doing so well only three months ago.

For its second quarter OmniSky reported revenue of $5.4 million, an increase of 590 percent from the $0.8 million reported for the second quarter of 2000. And its $0.38 loss per share was significantly better than First Call's analyst's consensus estimate of $0.63 per share.

But beating Wall Street estimates and its 42,000-member subscriber base couldn't save the company from the financial fallout from September 11 and OmniSky was forced to layoff of some 100 employees, mostly from its European offices, on October 3. The company still maintains a workforce of about 190.

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Ironically, the company was only burning $1.7 million a month in operating expenses and had blossomed some good partnerships including content deals with CNN and AOL.

But investors seemed to have turned away from the company, paving the way for a possible sale.

"At this point, the only companies that would have the cash to buy OmniSky would be the baby Bells," says Insight Research Corp. president and wireless sector analyst Robert Rosenberg. "It's very sad that even companies like Telegen and Winstar - ones with reasonable business plans are floundering. But the truth is that the market has fled the sector. Everyone says that telecommunications will be the basis for 21st Century business but we'll just have to see how it plays out."

It does make a lot of sense if a larger player like an AT&T were to make a play for OmniSky's technology now that there is more interest in business products that appeal not just to phone users.

And as more manufactures like Samsung and its PDA phone and the Handspring Visor Treo look to access voice and data on the same device, wireless operators could be looking for something like OmniSky's service to sell to its handheld users.