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Friday, May 22, 2009, 02:00 pm PT (05:00 pm ET)

Former Apple engineers at OQO call it quits

OQO, a company formed by two members of Apple's Titanium PowerBook G4 team who left the company to deliver the micro-sized laptops that Steve Jobs refused to build at Apple, is shutting down after nearly a decade of trying.

Jory Bell and Nick Merz left Apple in 2000 to form OQO after a struggle within Apple to develop prototype designs for a new micro-sized laptop that resembled a miniaturized Titanium PowerBook. By 2004, OQO had produced a tiny Windows XP device using the Transmeta Crusoe processor.

Since then, the company has shipped machines based on Microsoft's UMPC reference designs, which have found a small but ecstatic fan base. The company's sales have been unable to keep the operation afloat however, underlining Jobs' instincts that the market wouldn't support a tiny mobile handheld laptop even if it were a cool bit of engineering.

"We are sad to report that due to financial constraints, OQO is not able to offer repair and service support at this time," the company has stated. "We are deeply sorry that despite our best intentions, we are unable to provide continued support for our faithful customers. Please accept our sincerest apologies." OQO is no longer answering phones.

A blogger for GottaBeMobile.com reported comments from Bob Rosin, OQO's SVP of sales and marketing, who expressed hope that the company's technology and engineering teams could stay together "if a deal they’re working on with another PC vendor pans out."

The company is currently out of stock of its devices, and plans to complete a final manufacturing run didn't work out as hoped. There's no word yet on the identity of the PC maker interested in acquiring the group.

Apple has expressed no interest in developing a conventional netbook or UMPC-like device, but has signaled intentions to both deliver lower cost, WWAN enabled MacBooks later this year and to deliver a wider array of iPhone and iPod touch models, including a new tablet device many observers expect to see next year. The company is also actively hiring engineers.