Prodigy Services Co. announced on Wednesday that it was laying off 115 of its 680 employees.
Staff cuts at Prodigy were expected because the company is being streamlined to shift its on-line business onto the Internet, and Prodigy’s executive team is trying to attract investors to support a management buyout.
Industry analysts said the layoffs were necessary at -Prodigy, a joint venture of IBM and Sears, Roebuck & Co.
“The staff cuts are an important part of the management’s effort to get Prodigy in shape to peddle to the buyout investors,” said Gary Arlen, president of Arlen Communications Inc. in Bethesda, Md. “And they’ve got to hurry because they don’t have much time either to shift to their Internet model or to find anyone willing to invest in Prodigy.”
In the first quarter of 1996, Arlen estimated that Prodigy lost 15 percent of its subscribers, slipping to about 1.4 million.
