Psion announced today it will sack 250 staff in a shake-up of Psion Digital, after disappointing handheld and phone sales. It will also put back the Bluetooth products it said it would launch this year to next year, due to slow take-up.

The mobile computer company will concentrate from now on on big business, next-gen digital appliances and Symbian products - running away from the competitive and difficult consumer market. More corporate changes are expected in the future.

Expected revenues for the first half of the year are expected to be halved from last year to £36 million. The division created from its merger with Teklogix (called, appropriately, Psion Teklogix) will focus on industrial and enterprise markets while Psion Digital will work the new product end.

Psion put part of its troubles down to the US slowdown, as usual. Psion CEO David Levin said: "Trading in Psion Digital has been difficult. As a result of this we are taking major action to reduce our cost base while focusing on developing and exploiting our intellectual property and know-how to secure profitable new markets."

"The IT industry is experiencing its worst downturn since 1985," he continued. "Against this background, it is essential that we take the hardest approach to costs, control and a return to profitability while avoiding exposure to oversupplied commodity markets."

At the same time he announced there will be a range of new products for big business in September. ®