Intel to close Auckland office as industry goes soft

By RICHARD WOOD

Multinational chip manufacturer Intel is closing its Auckland development operation on May 2 and all its staff are being made redundant.

The company refused to give staff numbers, but it had more than 50 staff at the research and development lab after closing its sales and marketing operation in New Zealand last year.

Staff were advised of the closure in late February, only four months after chief executive Craig Barrett said he was happy with the progress of the lab.

Local boss Greg Allen said he did not know what had happened between then and February, but the telecommunications industry worldwide had been "very soft" for some time.

"That has required Intel to have a review of how it is going to service that market and adjust resources appropriately."

The Intel lab was originally a subsidiary of US-based Dialogic, which Intel bought in July 1999. It produced software for computer telephony integration.

Jim O'Neill, executive director of Industry group ITANZ, said the closure was no surprise because the IT industry had been in decline for some time.

"Our anecdotal evidence would suggest that the investment made by multinationals in New Zealand has diminished by 30 to 40 per cent in the last few years."

ITANZ wants the Government to put money into IT to help create products that can then be sold overseas in partnership with multinationals.

O'Neill said multinationals needed reasons to invest in New Zealand.

"There are no tax incentives. We haven't got an excess of PhDs."

Allen said one of the positive aspects was the release of highly trained, highly skilled engineers into the local job pool, where there is demand. He said many had already found work, including himself.

He is now head of development for local dental software developer Software of Excellence.