Metacafe, Diamond Firms Downsizing, Proxy Closes Down

Metacafe CEO Yoram Finkel said the steps came in response to current economic conditions.

Yet more layoffs were reported yesterday, ranging from high tech to low. In its second round of downsizing within months, Metacafe is firing 11 workers in Israel and three to five U.S. employees. A source in the know said that the community video-sharing site shut down its 5-man customer support department entirely yesterday morning. A separate source in the company confirmed the report, and added that preparations are being made for more cuts in its development graphics departments.

Metacafe CEO Yoram Finkel said the steps came in response to current economic conditions. but, he added, it isn't short of money.

Meanwhile, the trouble at Proxy Software Systems is worse. Proxy, established in 1996 by two former Motorola Israel workers, sent all of its 40 workers home yesterday and closed its doors.

Proxy had supplied outsourcing services for communications, voice and video systems.

Neighbors of the company's premises said that Proxy's entire workforce had been informed of the move on Monday, and by yesterday its doors were locked.

Sources in the industry noted that the company's ongoing projects are being passed on to other firms. Attempts to obtain comments by the firm's senior management were unsuccessful: it is not known whether the workers have received their salaries, or whether the company has other outstanding obligations to its customers and suppliers.

Nor is the local diamond industry immune to the crisis, as demand declines, pulling down the price of polished stones. Sources in the Israeli diamond industry say that production has been cut in recent weeks, and that 200 to 250 workers in the industry that employs 15,000 persons have been sent home.