Chiaro chirps, then cuts

FRAMINGHAM (11/21/2003) - After an upbeat briefing last week, core router start-up Chiaro Networks Inc. this week says it's laying off 15 percent of its workforce due to the continued telecom malaise and a shift in priorities.

Chiaro did not disclose its headcount either before or after this latest round of cuts. In 2000, the company said it employed 150, and published reports had headcount at 221 in late 2002, around the time Chiaro last had a workforce reduction.

Chiaro says the cuts were necessary to refocus efforts from engineering and development to sales and marketing as it looks to attract revenue. The company says it is continuing to focus on forming partnerships with established telecom equipment manufacturers in the U.S. and Europe, and with distributors in Asia; and looking to secure a place for its Enstara routers at "every important telecom carrier trial" for next-generation equipment.

"We expect to be able to redirect our resources to where they're needed most, namely, to the sales, marketing and support of our Enstara platform and at the same time we expect to move the company toward ever-greater financial stability," Chiaro said in a statement.

The tersely worded statement comes a week after Chiaro held a conference call with the press to update it on company progress. At that time, Chiaro said that it was about to land business at an Asian VAR that could gain it access into Japanese carrier KDDI, that it was involved in 10 carrier trials (including four in North America) and that it was in discussion with large incumbent equipment suppliers on potential "big brother" investment, distribution and support arrangements.

The VAR arrangement is with K-Solutions, a subsidiary of KDDI Corp.

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