CAMBRIDGE, ENGLAND (May 17, 1:45 p.m. ET) — Jobs could be lost at the United Kingdom plant of Plastic Logic Inc., the manufacturer of plastic display systems, after the group confirmed it planned to exit the e-reader market.
The move, which follows a strategic review of the business undertaken by chief executive Indro Mukerjee, will see the closure of Plastic Logic's U.S. operation in Mountain View, Calif., with the loss of 40 jobs.
A spokeswoman for the privately-backed group said its UK operation, based in Cambridgeshire, would be “restructured and a consultation process undertaken with affected staff.”
She declined to say how many jobs, either in the UK or in the group's German and Russian offices, would be impacted by the review.
According to Plastic Logic its business review "examined all aspects of the business" and concluded that it would “cease its e-reader product development activities and focus on other applications for its flexible plastic displays.”
The company added that it would “actively develop licensing and technology partnerships to exploit its e-reader related capabilities in terms of rugged, plastic displays as well as driver and viewing optimization software.”
Explaining its decision to quit the e-reader market Plastic Logic said: “Entering this market two years ago was a very logical step to take. It was growing fast.
“However, this market is driven by tough price competition and many companies are now relying on content sales exclusively to make an economic return and to cross-subsidize hardware.
“Therefore, for a company at Plastic Logic's stage of development, the e-reader model as a sole route-to-market does not make commercial sense at the current time.”
Commenting on the restructuring plans Mukerjee said Plastic Logic's proprietary technology would “drive our future growth potential and so we are aligning our people and resources to generate new opportunities for our technology which will both accelerate value creation, and advance the plastic electronics industry as a whole.”
Plastic Logic was founded by researchers from Cambridge University's Cavendish Laboratory. It now is controlled by Rusnano (the Russian Corp. of Nanotechnologies), a Russian state-owned non-profit corporation.