Monday, December 1, 2008

Wave Systems cuts majority of WaveXpress staff

By Galen Moore

Wave Systems Corp. will lay off about 12 employees at WaveXpress, cutting its majority-owned subsidiary down to two or three staff, a spokesman said. Headquartered in New York with offices in California, WaveXpress provided the TVTonic consumer media service.

TVTonic, which most recently offered extended content from the 2008 Beijing Olympic Games for Windows Vista users, has been suspended since last week, according to a report first published on AppScout. The layoffs will save Lee-based Wave Systems (Nasdaq: WAVX) $800,000 per quarter, Wave officials stated. The company plans to seek a licensee or buyer for the TVTonic technology, for which it will retain a “small staff” at WaveXpress.

Wave CEO Steven Sprague said the move will allow the company to focus on its core business of data security development. Company spokesman Mike Wheeler declined to comment on the reasons for WaveXpress’ failure to adequately monetize its online media service.

New York-based WaveXpress was founded in 1999 as a joint venture with New Jersey-based product life-cycle company Sarnoff Corp.

Wave, founded as Indata Corp. in 1988, announced in September it had raised $211,200 by selling 48 shares of 8 percent Series I convertible preferred stock for $4,400 per share. The news came about two weeks after Wave announced plans to sell 172 shares to generate $756,800. The company said the proceeds would help fund the company’s ongoing operations.