Trials, tribulations and layoffs

Raise your hand if you were shocked by those reports of big layoffs at Motricity.
Yeah, me neither. Sadly.
The heavily funded Durham, N.C.-based mobile content company is said to be slashing nearly a third of its 650-employee workforce in the wake of its acquisition of the mobile operations of InfoSpace Inc. Roughly 200 employees are getting pink slips, according to WRAL.com, and the firm is considering moving its headquarters from Durham to Bellevue, Wash., home of InfoSpace’s mobile operations.
A Motricity spokesman declined to comment immediately, saying the company would respond to the story by yesterday afternoon. We’re still waiting. Which makes me think there are still at least a few Motricity employees in limbo.
The move – er, alleged move – was not unexpected following the $135 million buyout of InfoSpace. The buyout was sure to result in some redundancies, and Motricity has a history of burning through employees as quickly as it burns through investment capital, cutting 50 jobs a year ago even as it announced a $60 million round of financing. (The firm has pocketed at least $350 million in venture capital to date, and recently moved into swanky new digs in Durham.) And turmoil is never far from Carl Icahn, one of Motricity’s biggest investors.
The reports sparked a rash of angry responses from Motricity employees – or former employees – according to WRAL and several message boards. Many of the outbursts were aimed at Motricity CEO Ryan Wuerch, who has been at the helm since 2001.
A demanding market
The massive job cuts mark a much-needed – but sobering – move for Motricity, which has had difficulty keeping its balance as the mobile content ground continues to move beneath its feet. The company last month spun off its e-book business in yet another move to streamline operations, and a long-rumored IPO seems less likely than ever.
And a marriage between Motricity’s content business and InfoSpace’s search expertise could prove a savvy strategy. Downloads such as ringtones and games continue to drive the overwhelming number of most mobile searches, , according to eMarkter and Medio Systems, and improving the discovery process could boost content sales in a major way.
Motricity will need that plan to succeed, and quickly, if it is to survive. But for 200 of its employees, it seems, it’s too late.