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Technology Stocks : Concurrent Computer (CCUR) -- Ignore unavailable to you. Want to Upgrade?

To: James M. Bash who wrote (17509)	4/18/2002 3:55:28 PM
From: Don Hand	Read Replies (1) \| Respond to of 21143

Diva cuts 20 percent of staff, said to be on the block Diva Systems officials confirmed late Wednesday that the VOD vendor laid off 20 percent of its staff early in the week as part of an effort to reduce expenses and streamline operations. Diva, according to a recent Securities and Exchange Commission filing, has enough cash to get it through the end of this June. Diva declined to say how many employees were affected, but sources said the company laid off approximately 40 people. "The VOD market is becoming more and more competitive with aggressive pricing," Diva said of the layoff, in a prepared statement. "While this will result in a streamlining of operations, we are certain that we can continue to provide the support our customers need to meet their VOD business objective." According to sources familiar with the situation, Diva also has been seeking a buyer for several months. Potential suitors, which have ranged from undisclosed Diva rivals and companies trying to break into the U.S. cable VOD sector, have held discussions with the company, but have been hesitant to pull the trigger due to Diva's heavy debt load, sources said. Diva, a privately-held company based in Redwood City, Calif., reported in its most recent 10-Q filing liabilities of $402.2 million and cash and cash equivalents of roughly $20.2 million as of Dec. 31, 2001. Diva also called into question its ability to remain a going concern, noting in the filing that it believes its cash, cash equivalents and short-term investments reserves will only be sufficient "to satisfy our cash requirements through June 30, 2002." Diva also disclosed that it has accumulated a deficit of about $500 million, with losses "primarily due to engineering and development expenditures and other costs required to develop our video-on-demand products and services." The company added that it expects to "incur substantial net losses and negative cash flow for at least the next few years, requiring us to raise additional capital...or pursue other strategic alternatives." Diva officials declined to comment further on the company's financial health or on speculation that it's presently seeking a buyer. To date, Diva's VOD deployments are limited to three MSOs: AT&T Broadband (two markets), Insight Communications (10 markets) and Charter Communications (roughly 17 markets). Charter is among Diva's strategic investors. Combined, Diva's major stockholders and directors owned roughly 74 percent of the company as of Dec. 31, 2001. As of that date, Diva had approximately 659,000 VOD subs, up from 25,000 at the end of 2000. cedmagazine.com