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Geoworks throws in towel and puts GEOS up for sale

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ComputerWire: IT Industry Intelligence

Wireless software pioneer Geoworks Corp has thrown in the towel, giving up hope of developing its AirBoss application platform technology and has put it up for sale along with the source code for its GEOS and GEOS-SC operating systems.

The Alameda, California-based company said the wireless infrastructure market is "very weak" and, while it will eventually be significant as enterprises adopt mobile data applications, Geoworks simply does not have the financial resources to support development of the AirBoss platform and wait for the market to emerge.

The company, a pioneer in the development of operating systems for handheld devices, wants to sell the AirBoss team and transfer the technology to a company "that has the resources to weather current market conditions." But president and CEO Dave Grannan warned: "Of course, we cannot guarantee that we can find an appropriate buyer."

The company's greatest moment of fame came in 2000 when it claimed much of the intellectual property behind WAP, and demanded license fees from developers. However, this fizzled out when it reached a settlement with Openwave Systems Inc in January 2001.

Geoworks is a sad example of an organization that was ahead of its time in that it saw the arrival of portable devices ahead of the pack but its early appearance meant that it OS lacked the "future proofness" of later software. Lacking the muscle of Microsoft or the advanced features of Symbian's OS, the writing was on the wall when Nokia dumped GEOS in favor of Symbian.

Geoworks' capitulation was inevitable given pitiful and declining revenue and losses that have brought the company to its knees. In the third quarter to December 31, it recorded a net loss of $13.9m, up from a loss of $7.1m on revenue of $4m, down from $4.2m. For the nine months the loss was $41.6m, up from a loss of $14.8m on revenue of $9.2m, down from $11.7m.

To reduce the cash burn, it will lay off 40 people, or 45 per cent of its workforce, from the AirBoss and headquarters staff and will move its headquarters to smaller premises. For the future it plans to continue as a professional services firm, though this produced only $1.7m of revenue in the last quarter, or 43.2 per cent of the total and was down on the $2.1m a year earlier.

AirBoss, which offers support for the RIM, Palm, Pocket PC, Windows CE and Windows 98.2000/NT platforms, has wider support, but is a long way from being a money-spinner. Ironically Geoworks' web site warns that the industry is constantly abuzz with news of start-ups and promising technology. "But when you're staking your business on a strategic initiative like mobile communications, there is no room for risk. Geoworks has staying power," it says.

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