RealTime IT News

OpenTV Restructures, Nearly Halves Staff

Mountain View, Calif.'s OpenTV Monday announced a sweeping plan to pare its work force by some 47 percent, eliminating 315 staffers and restructuring its global operations.

With the intention of reducing expenses and making efficiency adjustments associated with its recent purchase of Wink Communications, the interactive television software maker hopes the play will help weather the tough economic climate in the cable and satellite industries. Wink will continue to operate as a separate subsidiary of OpenTV.

OpenTV, whose software and other products may be found in some 35 million homes worldwide, will also close eight regional offices. OpenTV believes its restructuring will be finished by the end of the first quarter of 2003, resulting in cost savings and a cash burn reduction of approximately $60 million and $48.0 million, respectively.

OpenTV estimates that this restructuring initiative will result in a pre-tax restructuring charge of approximately $29 million, $20 million of which will represent cash obligations. This charge is in addition to an estimated pre-tax restructuring charge of $4.1 million associated with the previously announced closure of the company's Naperville, Illinois office, and an estimated restructuring cost of approximately $4 million associated with Wink.

"We believe these cost-cutting measures will result in a more efficient and focused company that will be well positioned to serve our customers and our goal of achieving long-term growth and profitability," OpenTV Chief Executive Officer James Ackerman said in a public statement.

OpenTV, who competes with the likes of Liberate Technologies and Microsoft in the iTV software sector, was snapped up in May by Liberty Media for $185 million in cash and stock.