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Technology: Lucent shuts down Israeli firm Chromatis
By STEVE WEIZMAN, Associated Press
JERUSALEM (August 27, 2001 7:01 p.m. EDT) - Chromatis, one of Israel's high-tech Cinderellas, found herself locked out of the ball on Monday when American giant Lucent Corp shut it down, leaving 130 employees in Israel and 20 in the United States without jobs.
Lucent brought the Israeli optical networking producer for $4.8 billion in January 2000, making millionaires of many of the staff.
On Monday they found themselves facing unemployment, the latest victims of the worldwide technology crisis.
"As part of our restructuring efforts we have had to reorganize our priorities and make some difficult decisions," Lucent spokesman Frank Briamonte said. "As a result of this restructuring, we are exiting the product."
Briamonte told The Associated Press that it was "a purely business strategic decision" unrelated to 11 months of Palestinian-Israeli violence.
It was the latest in a series of blows to Israel's high-tech industry, which has found itself caught between the collapse of the Nasdaq stock market, where more than 120 Israeli firms are listed, and the effects of the violence.
The State Department's warning to Americans not to travel to Israel, the West Bank or the Gaza Strip has had its effects, as well. The travel advisory forced Intel Corp. to postpone plans to send employees to Israel for training. Also, American technicians were unable to travel to Israel to maintain equipment at Intel facilities.
Israeli economic analyst Sever Plocker said Israel's high-tech industry is expected to suffer more, but should recover.
"I think that more and more Israeli start-ups will close down," he said. "But when the high-tech crisis is over, we will see hundreds and hundreds of new ventures, because the talent and imagination are still there."
The sector now accounts for about 10 percent of Israel's gross domestic product, and high-tech products make up 57 percent of total industrial exports, according to the Israel Export Institute.
Currently, about 67,000 people work in the high-tech industry, though a recent survey by a leading employment agency found that the sector was losing its appeal. Despite the often handsome financial rewards, the survey recorded, the people were deterred by a perceived lack of job security. |
