Seagate Technology said Thursday it plans to close its recently built research facility in the Strip District and shed 159 jobs in June when it integrates the operations into centers elsewhere.
The decision stung Pittsburgh's burgeoning high-tech sector, as Seagate is the world's largest maker of computer hard drives. Its highly skilled workers -- about two-thirds of whom hold doctorate degrees -- provide cutting-edge research for the computer industry in its continuing quest to store more data in smaller spaces.
"The departure of Seagate's research facility in the Strip District undoubtedly will cause a major ripple throughout the region's technology community," said Audrey Russo, president of the Pittsburgh Technology Council.
She called it "the loss of a brand name technology company," but said the region still has "thousands of technology companies" who would hire many Seagate employees cast adrift.
"There is disappointment, naturally, in Seagate's news," said Dewitt Peart, president of the Pittsburgh Regional Alliance. "But the positive (news) is that Seagate's employees -- highly skilled IT specialists -- are going to be in demand in our market."
Seagate, which is based in Scotts Valley, Calif., first located in Pittsburgh in 1998, in temporary quarters on the South Side. It moved into its current, $40 million center along the Allegheny River in summer 2002, and often has worked in tandem with Carnegie Mellon University.
The local operations will be absorbed by the company's research and product development centers in Bloomington, Minn., and Silicon Valley, Calif., said spokesman Forrest Monroy.
The decision was made "to enhance the speed, flexibility and cost-efficiency with which our (research and development) investment is turned into time-top-market products," Monroy said. There was no "triggering event" as to the move's timing, he said.
The first employees will leave in February. As operations phase down, there would be other employment opportunities in other states for those people, but the remainder will receive severance and outplacement services, he said.
Seagate chose Pittsburgh mainly at the insistence of Mark Kryder, whom Seagate hired away from the faculty of CMU's Data Systems Storage Center to be Seagate's first director of research.
Kryder, who was traveling yesterday and unavailable, retired from Seagate in early 2007. He returned to CMU as professor of electrical and computer engineering, said colleague and department head Ed Schlesinger.
Schlesinger credited Seagate's Pittsburgh research center for developments in heat-assisted magnetic recording techniques, which vastly expanded the storage density of computer hard drives.
For instance, Seagate announced in September 2006 a device that could hold 421 gigabytes per square inch of recording media -- three times more data than hard drives available in notebook computers, said the technology council's Russo. That innovation could be on the market next year.
"Was it convenient to have Seagate 10 minutes from campus⢠Sure," said Schlesinger. "But in terms of collaborations with CMU, that will continue."
Seagate occupies four floors of the six-story building -- or 160,000 of the 200,000 square feet of space in the building, under a long-term lease, said building developer/owner The Buncher Co.
"Seagate's building is in a prime location and it's got great high-tech labs. So I doubt it will sit vacant for very long," said Kevin Evanto, spokesman for Allegheny County CEO Dan Onorato.
Staff writer Sam Spatter contributed to this report.
