Close to 40 let go

Waynesboro-based nTtelos said Tuesday it immediately will reduce its workforce in the wireless area by 37 employees and offer early retirement to 11 more.

The communications company said it would also leave 20 positions unfilled. All the positions are in the support area of wireless, nTtelos spokesman Mike Minnis said.

Most of the 37 layoffs will occur at the Waynesboro headquarters.

Minnis cited a combination of factors in nTtelos’ decision.

“The economy has certainly had an impact over the past 12 to 18 months and the wireless industry has matured. There is 90 percent penetration for wireless service,’’ Minnis said.

He said attempting to grow and expand wireless in challenging economic times is difficult.

“People are not looking to increase their bills,’’ he said.

Minnis said Tuesday’s announcement was not done because of financial difficulty, but so the company could position itself for the future.

A week ago, nTtelos reported third-quarter earnings of $135.7 million, including $104.2 million in wireless.  A third-quarter dividend of 28 cents per share was authorized.

As a result of Tuesday’s announcement, the cash severance, non-cash pension and other charges will cost nTelos $1.5 million in 2009.

Minnis said the company would reduce expenses by $4 million in 2010.

nTtelos’ Tuesday announcement comes a day after Sprint Nextel Corp. announced plans to eliminate 2,500 positions by the end of the year.

A wireless industry expert said the 25-year-old industry continues to grow and change and the companies offering the best smart phone services will experience the most revenue growth in the immediate future.

“The smart phone side is where the revenues are,’’ said industry analyst Jeff Kagan. “That is exploding.”

Kagan said in addition to advanced services, the brands of major companies like Verizon and AT&T can make competition an issue for smaller companies.

“You see the Verizon and AT&T logo everywhere,’’ he said.

Minnis said nTelos has successfully competed against other wireless companies with its menu of smart phones that include the Blackberry Curve.

He said the company soon will roll out a new android open operating system.

In its third-quarter statement, nTelos said smart phone and data card sales were 30 percent of postpay gross additions, up from 23 percent in the third quarter of 2008.

nTtelos employs 1,200 people, primarily in Virginia and West Virginia. The company also offers local telephone service, broadband services and cable television.