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DVR Venture Digeo Slashes Its Staff In Half

1/18/2008 7:00 PM Eastern

Digeo, the digital video recorder venture backed by Paul Allen, last week laid off 80 of its 160 employees — halting development for two of its retail high-definition digital video recorders.

CEO Mike Fidler will leave the company, with Digeo president and chief operating officer Greg Gudorf assuming the CEO role.

“With our revised product strategy, it made sense to realign our leadership team as well,” Fidler said in a prepared statement. “While the new strategy is absolutely the right thing to do for Digeo’s business, Greg and I both profoundly regret the personal consequences of this action for our employees who will be affected.”

The laid-off employees are “mainly in positions that are not critical to development of the new products,” the company said.

With the cutbacks, Digeo will scrap two retail DVR products it had previously announced: the delayed Moxi Multi-Room HD DVR and the Moxi Home Cinema Edition DVR.

Instead, Digeo said it will focus on its next-generation consumer digital media recorder, which Digeo has been developing at the same time as the cancelled projects.

Gudorf, in announcing the changes, said Digeo had been “spreading our energies across too many platforms. This focused strategy promises to bring a set of advanced and compelling DMR [digital media recorder] features to consumers, at the right cost and at the right time.”

Digeo’s Moxi HD DVR for the cable industry is being tested now, according to the company, and will be released as planned. To date, about 400,000 of Digeo’s existing DVRs have been deployed in 100 markets by eight cable operators nationwide.

Digeo had hoped to launch retail versions of its Moxi high-definition DVRs before the end of 2007, but the products hit development delays. The Kirkland, Wash.-based company said it would announce details on its new retail product later in the year.

As recently as the Consumer Electronics Show in Las Vegas earlier this month, the company was touting four new partnerships to deliver photos, music, games and information to its forthcoming retail DVRs. Digeo said current content and development partnerships will remain in place for the product strategy.

September