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Layoff days dawn for Sanrise

The storage-management company has laid off an undisclosed number of employees in the midst of the tech hangover.

Sanrise, which specializes in storage management, has laid off an undisclosed number of employees in the midst of the tech hangover.

Layoffs began earlier this month, a company representative confirmed Friday. The Dublin, Calif.-based company would not say how many employees were laid off, but sources said the number was sizable. Before the layoffs, Sanrise employed 290. The cutbacks occurred in different parts of the company, the representative said.

Sanrise derives about 90 percent of its revenue from providing storage-management services to other businesses, typically large corporations. Like many other storage companies, Sanrise sells bundled hardware and software.

The company has more than 600 customers, including Toyota and National Semiconductor.

Storage had been one of the computing industry's hottest sectors in the past few years. The explosion of data created by the Internet drove demand for technology that could store and retrieve information in a coherent manner. Storage-equipment makers like EMC benefited from the trend first. Service specialists then began to gather momentum in the second half of 2000.

Although the storage industry ultimately relies on hard drives, companies largely derive their profits from the software and other technological know-how that animates the massive storage systems.

Storage fever, however, began to abate this year as corporate spending dried up. Both EMC, the leader in storage, and Storage Networks announced layoffs earlier this year.

Despite the downturn, Sanrise has continued to attract interest. In May, it landed $115 million in funding from Crosspoint Ventures, Acon Venture Partners, Comdisco Ventures, Morgan Stanley Dean Witter Equity Funding, Exodus, Hitachi Data Systems, Hitachi and others.

At the time, the company said it planned to use the funds, in part, to expand its fiber-optic data-storage network and increase its operations overseas.