Toshiba cuts jobs in U.S. PC unit

Toshiba America is restructuring its troubled personal computer unit, laying off about 200 workers on Wednesday, according to a source within the company.

The layoffs were concentrated in the computer systems group, a unit of the Irvine, Calif.-based Toshiba America Information Systems division, said the insider, who requested anonymity. The computer systems group sells Toshiba's lines of PCs, laptops, handheld computers, projectors and mobile servers. The group's staff comprises the bulk of the 1,250-employee information systems division, a Toshiba representative said.

The representative would not disclose the number of positions the company is cutting, but confirmed that it's restructuring the unit and that the reorganization entails layoffs. Toshiba plans to announce the details of the plan Thursday, she said.

The head of the computer systems unit left Toshiba earlier this month, at which time the company signaled that it would make some organizational changes.

Toshiba, a privately held Japanese company, has been beat up by Dell, Hewlett-Packard and IBM in the corporate PC and laptop market, analysts say. Shipments of Toshiba notebook PCs, one of its key products, fell by 21 percent worldwide during the second quarter, according to market researcher IDC.

"They've been struggling with product lines and (distribution) channels," said Gartner analyst Martin Reynolds.

Wednesday's layoffs were aimed mainly at sales representatives who managed corporate accounts, a group known as Toshiba Direct, the anonymous source said. It appears the company is moving away from selling direct to business clients and focusing on distribution partnerships instead, the source said.

[jw2781]

Toshiba should have never gone to direct sales in the first place that was one of the reasons that started there down fall back in 2004.