When Execs Go Zip

How many miles separate San Diego from San Francisco? Too many, apparently. At least for Iomega (NYSE: IOM) CFO Barry Zwarenstein, who will leave the company next month to take a similar position closer to home.

What can one make of this? Weekly commutes, especially across California, can be a burden of water torture proportion. I can respect a family man's decision to want to toil closer to home. However, the cynic in every investor is never satisfied until an ulterior motive materializes.

In Zwarenstein's case, the jaded are bound to come away empty-handed. The Bay Area offers plenty of tantalizing opportunities. Besides, it's not as if Iomega is on the verge of slipping. It bruised those knees ages ago.

Anyone who was around during the early years of The Motley Fool probably has a soft spot for Iomega. The online medium was validated as our growing community huddled together on our corner of Time Warner's (NYSE: TWX) America Online to see Iomega's distribution channels widen as it launched its revolutionary Zip drives and discs.

Yet, technology can be a cruel thing. Nowadays, portable data storage is a commodity flooded by "me too" USB drives of all shapes and sizes. The ultimate Iomega surrender came last year when the company issued a onetime $5 per-share dividend. That portly payout could have been interpreted as evidence of a company out of ideas. Even readers of our Motley Fool Income Investor newsletter, who certainly appreciate a meaty yield, might recognize that move as bad tidings.

But it's not always that way. Next month theater operator Regal Entertainment Group (NYSE: RGC) will do the exact same thing, and its prospects remain bright. However, there's a major difference between the cash-cow multiplex business and a field of technology that mandates expenditures in research and development to remain current.

So, yes, Zwarenstein is leaving, but one has to wonder if the drive company's drive cleared the exit door first.

Where do you think that Iomega went wrong? Why is the CFO really leaving come June? Does the company have anything in the pipeline that may turn its fate around? All this and more -- in the Iomega discussion board. Only on Fool.com.

Longtime Fool contributor Rick Munarriz remembers the empowering early years of Iomega and The Motley Fool. However he does not own shares in any of the companies in this story.