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Corel closing Orem offices

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WordPerfect creator Alan Ashton thinks his once revolutionary word-processing software will still be remembered as a Utah product even though it will no longer be made in the Beehive State.

Ashton recalled that when WordPerfect went worldwide people everywhere identified it with Orem, Utah, where Ashton and Bruce Bastion founded WordPerfect Corp. in 1980. Now when people load the software into their computers, they'll see Ottawa, Canada, listed in the copyright."I just hope that Corel can continue to be successful with WordPerfect," Ashton said while guarding his personal feelings about his brainchild leaving home.

Corel Corp. will close its research and development division in Orem over the next two months, putting 530 employees out of work. Home-grown Word Perfect will be among the company's products now in the hands of software engineers at Corel's headquarters in Ottawa, Canada.

Corel bought WordPerfect from Novell Inc. in January 1996 for $185 million.

It's the second time in a week that a major high-tech employer has sent Utahns scrambling for new jobs. Iomega announced June 18 it will lay off about 400 people from its Roy headquarters.

Ashton said the Corel move is an indication of change that started in the industry a few years ago and continues now. And, as usual, he preferred to take an optimistic outlook.

"Whenever there is loss of job opportunities, there are some pangs of sorrow, and yet in each case, it has worked out for each individual and for the community," he said.

The move is necessary, Corel executives said, to put the shaky company on stable financial footing and bolster its product line. The company Wednesday reported a net loss of $8.3 million for the second quarter of fiscal 1998, continuing a string of dismal quarterly performances. Corel lost $231.7 million in 1997.

"This decision was not taken lightly, rather with the best interests of our customers and shareholders in mind," Michael Cowp-land, Corel president and CEO, said a in prepared statement. "It strengthens our products, strengthens our fiscal outlook and sets the stage for the next two years."

Corel estimates the closure will save $33 million a year.

Workers returned from lunch Wednesday afternoon to e-mail messages calling them to the Provo Marriott Hotel. Many expected to be informed about another buyout or merger. Instead Paul Skillen, vice president for development, told them in a meeting lasting only five minutes that they would no longer have jobs at Corel, himself included. The company will offer placement services and severance packages.

"I was caught very off guard," said Mike Wynn, an employee of more than seven years who has survived layoffs, mergers and buyouts. "I somewhat expected some layoffs, but I certainly didn't expect them to shut down the whole place."

Employees went back to the Orem campus to find the buildings locked and security guards posted outside. Workers were given Thursday off.

The cut reduces Corel's worldwide work force 20 percent. The company will create 150 new jobs in Ottawa and 40 more at its New Hampshire and Dublin, Ireland, facilities to replace the Orem workers, some of whom may apply for work at the other engineering centers.

Corel acquired what was once the world's leading word-processing software from Novell in early 1996, about 18 months after Novell bought out WordPerfect Corp., for $885 million. The WordPerfect-Novell union was rocky from the beginning as WordPerfect took a back seat to Novell's networking products.

When Corel entered the scene, Cowpland promised to wage a Pepsi-Coca Cola-style battle with Microsoft to win business application users. But Corel fizzled and lost market share to Microsoft Word, the current word-processing software king.

"Corel has become another company that tried to take on Microsoft and lost. Customers - regardless of what the feds say - seem perfectly happy buying Microsoft products. The newest release of WordPerfect is a fine product, but that doesn't matter in a market where everyone just seems to want to be like Bill (Gates)," said David Coursey, a technology industry expert who has followed WordPerfect since its days on State Street in Orem.

WordPerfect and Novell put Utah Valley on the high-tech industry map in the 1980s. Both companies, however, went through some shaky times. Fortunately, Coursey said, Novell is on the mend and some smaller companies have sprung up, otherwise Provo/Orem would be on the road to being a "formerly hot" place.

Utah Information Technologies Association President Peter Genereaux, who met with a Corel vice president as late as Monday, had no inkling a shutdown was in the offing.

"That's a shocker to hear that," he said. "That's nasty news."

Genereaux decided to look at the "bummer" from a bad news-good news perspective. The bad news, he said, is Utah is losing another technology information company. The good news is that the technical skills Corel employees are possess are in high demand right now, he said.

Wynn, for one, isn't going to shy away from the high-tech industry. "I knew it was volatile when I got into it, and I plan to stay in it," he said.

Some 2,200 information technology companies in Utah employ just under 40,000 people, generating more than $6.6 billion in sales.

While Ashton kept his emotions in check, others not as closely tied to WordPerfect didn't.

"It think it's sad for us," said Rick Mayfield, state business and economic development director. "That was grown here and now it's going to be gone."