He quickly determined that if he could outsource the Exchange server to a host at a reasonable cost, he might be able to satisfy all the project requirements. As a vice president for Hewlett-Packard Co., he learned that the theory works in the world of computers. Now he's trying to revive Iomega's flagging sales by applying the concept to the company's mainstay products. Move enough Zip drives, he figures, and maybe customers will buy enough Zip disks to buoy up Iomega's bottom line.
Problem is, it's unclear if there's room for growth in magnetic storage devices.
Rewritable compact discs are getting cheaper every day and rewritable DVD's are around the corner. Iomega is pressing forward nonetheless, putting money into marketing even as the company is laying off 1,250 of its 3,300 employees in an effort to slash costs. Heid took the CEO's job in June, replacing Bruce Albertson, who resigned over differences with the board. He is paring down Iomega's product lines, temporarily abandoning efforts to push trendy retail products that Albertson had championed such as the audio player HipZip and picture storage system FotoShow. The company is also targeting new customers by cutting prices on Zip drives, which accounted for nearly 79 percent of its revenue in the latest quarter.