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Comments on: Microsoft planning big layoffs for January?

The latest rumor puts the possible job cuts at 15,000, or nearly 17 percent of Microsoft's worldwide operations, with MSN getting hit hard.

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by solitare_pax January 1, 2009 10:57 AM PST
Hopefully it will be the entire marketing department that gets fired after wasting a ton of Microsoft's cash on the Seinfeld and I'm a PC commercials.

Those Microsoft marketing guys can all go back to making churros! YUM!
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by WillyWiggler January 1, 2009 11:10 AM PST
*** CNet?!?! Is this what passes for "journalism" now? The FudZilla"article" doesn't cite any sources, the author doesn't have any credility, and the FudZilla site seems to be some kind of a bulletin board for consumer reviews. Why would CNet (which has some, albeit diminishing, credibility) comment on an article from this site?!?! This is a pitiful example of the echo chamber.
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by dfarber January 1, 2009 2:13 PM PST
There is a lot of speculation about MS potential layoffs. We are reporting on the various rumors and threads, not making any claims about the layoffs.

We'll see what MS has to say tomorrow, if they offer any statements.

Given the economy and the fact that MS is not immune to the downturn, it wouldn't be surprising to see some layoffs or less use of contractors and not filling every open job. The 15-17 percent seems extreme, more of a major reorganization of the company. We'll continue to track this story.
by Maclover1 January 2, 2009 9:11 AM PST
http://www.marketwatch.com/news/story/speculation-about-microsoft-cutbacks-heats/story.aspx?guid={00A0555E-2724-49E4-AA3C-B2FAEA98805B}&dist=msr_6

Use a search engine, this cnet story is actually old news.
by paulsecic January 2, 2009 10:25 AM PST
CBS is cool.
by WillyWiggler January 2, 2009 10:29 PM PST
dfarber said "We are reporting on the various rumors and threads, not making any claims about the layoffs."

You published an article based on some random post from some no-name website. It is not only incredibly irresponsible, but it is really, really unprofessional. You're just "...reporting on the various rumors..."? News reporters report NEWS, not rumors. News reporters get information from verifiable sources, not fudzilla.com.

There's no difference between fudzilla and the comment section on this story. Here's some more "news" for you CNet:

Microsoft will lay off 15% of their work force in January. Employees will be given 4 weeks to find another job in the company, or they're out of a job. I've heard it this confirmed from reliable sources.

There you go CNet. Another source for you. You can write another article about the layoff rumors.
by Mr. Dee January 1, 2009 11:15 AM PST
This wouldn't be a great way to start 2009 for some of those MS employees.
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by vamman January 1, 2009 11:18 AM PST
CNET just likes to make Microsoft look bad =) Its run by a group of Apple thumpers secretly working for Steve Jobs. Check out the Apple innovation article posted yesterday for proof!
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by myles taylor January 1, 2009 11:45 AM PST
That's not proof. I have always found CNet very objective. The Zune 120 won the last prizefight with the iPod Classic and I saw a lot of gripes about the newest Apple Cinema display. Read the site please; there is a ton of stuff criticizing Apple on here. Watch the Applebyte if you want to see some CNet gripes. If they're working for Steve Jobs, they should be fired.
by Hunnter2k3 January 1, 2009 11:44 AM PST
If true, it would be a shame if the MSN side were hit with this.
That and MSDN are pretty much the only 2 parts of Microsoft i actually care about.
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by Penguinisto January 1, 2009 11:46 AM PST
Right now it's just rumor, but if you look closer, there's a bit of analysis behind it that makes the whole thing plausible. MSFT is (albeit slowly) losing marketshare in general to Apple (and in smaller part to Linux and the like). MSN is on frickin' life support and should have died years ago when AOL crashed like it did. Windows Mobile in particular lost marketshare hard over the past couple of years, and growth is sluggish at best there. Nintendo kicked xbox solidly in the groin over the past year-and-a-half (though to its credit, the massive price slashes for xbox 360 have kept it growing, though at a far slower rate).

The trends and numbers don't lie... MSFT needs a shakeup, and it needs one now. Too bad they can't do the same to the upper management, but you get what you can.

The funny part is, Intel did two layoffs - in January 2007 and January 2008 (they laid off 11,000 in 2007, and at least 1500 more when it trimmed its IT department specifically in 2008).

Now I realize you Microsoft cheerleaders are all uptight about it and all, but seriously - this is normal (yes, normal!) for large corps to do on a regular basis. Marketshares shift, divisions become unprofitable and products go into maintenance mode. All of that means either the employees affected go to new projects, or they get laid off. Since it's normal even during good times, I would expect it to happen even more in the not-so-good times.

Me, I got to see one of these from the inside. It's not pretty, but sometimes it is necessary, esp. given corporate cultures in and about the tech industry. Instead of whining and ******** about how this is awful, awful news, how about looking at it like it truly is - a chance for MSFT to actually trim the fat and re-orient itself to meet market realities. As it is, (at least IMHO), Microsoft is too bloated and moribund these days to compete effectively, and its loss of marketshare in many sectors prove that. If they trimmed the fat, maybe they can shake things up a bit, and get themselves out of the mud for once...

/P
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by Vegaman_Dan January 1, 2009 12:42 PM PST
Penguinisto:

You have to be off your absolutely freaking rocker there, man. Think about exactly what area that Apple and Linux is making a dent in Microsoft's sales. It's the desktop *consumer* market. Apple doesn't even touch the business market and that enterprise market is where Microsoft is not only thriving, but growing. This is the reality of the situation.

MSN is one area that I don't see any company should be involved with. ISP/Content delivery isn't where the money or market is these days. I think MSN should go the way of AOL and Yahoo, personally.

Xbox vs Nintendo is a good comment. Keep in mind that Nintendo has just had their North American headquarters bought out by Microsoft and Nintendo does not have plans to replace it when they leave the building. I don't know where they are moving, but Nintendo's employees have not been given any notice where they can apply for work when the company moves their HQ- or closes it. It's very possible they will pull back. They don't need a presence in the US anymore for a HQ and do all their work back home. Does that mean the 5K people in Redmond who will be losing their jobs at Nintendo indicates the company is failing? No, of course not.

I agree that MSFT needs a shakeup. Most companies can benefit from that. Apple is doing that now with the start of Steve Jobs' departure. We'll see how that turns out.

Now as for the rumors of MSFT layoffs- someone better tell Microsoft that they are planning on layoffs- they are currently *hiring* people and expanding their campus by nearly half again larger. The Redmond campus alone is expecting to see an increase in 20K positions. I know this because it's my job to have to plan support for those employees. If MSFT is going to be laying off all these people, then it's will be a surprised to Microsoft as well.

That's the problem with unfounded rumors like these. When you present them with facts and reality, they simply don't stand up.
by Penguinisto January 1, 2009 2:47 PM PST
Yes, Dan - it's in the consumer markets... for now (though Linux is still going very strong in the server and Enterprise markets as well). But - that's where it all begins this go 'round. Where once PC's went from work to home, now it's the other way around, with the iPhone as a huge example.

As for Nintendo, I have no idea - they're growing like crazy though, and their sales numbers show it.
by Vegaman_Dan January 1, 2009 8:17 PM PST
Pengunisto:

If Apple ever wants to get into the enterpise market, it would mean losing the ironfisted approach they have on control over the OS and support. Enterprise customers need their hardware repaired *now*. They need overnight parts for repairs on the spot- Apple doesn't allow this and you have to send the equipment to them. I have to do this now and while I can get a part for a Dell or HP system overnight, when I have to send a laptop to Apple, it takes a week at the absolute earliest. That's going through Apple's official channels. Now there are some unofficial channels, but they don't offer the OEM warranty or support.

Enterprises are also cost concious. When they see a Lenovo laptop for $1200 and a Macbook for $2500 that is meant to do the same job, then that is not a very good comparison for the enterprise customer to make. When they add in the difficulty in support, then it simply is not an option at this time. Not at enterprise levels, at least.

This could change, but Apple has not made any indications of this in their actions or past history.
by Penguinisto January 2, 2009 5:55 AM PST
"ironfisted"? My, don't we have a flair for the dramatic...

You act as if the enterprise market cares about vendor "control" of either OS or hardware (you do remember that this is the same enterprise market that happily buys things like Sun servers and Exchange, right?) Trust me, as someone who has been bringing Linux to the enterprise market (and using it once it gets there) for years now, you would be astounded at the complete and utter lack of caring from the folks who write the POs for these things.

As for your comparison of notebooks, you completely forgot all about the cycle. If I can carry a 5-6 year cycle on a laptop (instead of the average 2-3 year cycle on laptops today), then the costs amortize nicely and the price is more than worth it - let alone the lower TCO due to reliability and customer (read - business) satisfaction. Support "difficulty"? Feh - it would be but a minor change to for Apple add in the same 4-hour Gold SLA - just stock the Apple stores with the needed parts (unlike Dell and HP, who has to mostly contract such things out and maintain separate logistics chains for it).
by Commander_Spock January 2, 2009 11:10 AM PST
Re: "[...Right now it's just rumor, but if you look closer, there's a bit of analysis behind it that makes the whole thing plausible. MSFT is (albeit slowly) losing marketshare in general to Apple (and in smaller part to Linux and the like)....]" Since it was stated in CNET NEWS a few ago that the British are going to run their submarines on the Microsoft Windows XP Operating System then any Apple market share increase against Microsoft Windows might be quite negligible. You loose some... you win some.

Re: "Royal Navy goes with 'Windows for Subs'"

http://news.cnet.com/8301-13639_3-10129373-42.html?tag=mncol

The "Apple" (Windows) just do not fall very far from the "Tree" (OS/2 Warp) - Huh!
by Vegaman_Dan January 2, 2009 1:50 PM PST
Penguinisto wrote:

"""ironfisted"? My, don't we have a flair for the dramatic..."

Yes, but it's accurate.

"you would be astounded at the complete and utter lack of caring from the folks who write the POs for these things."

Oh, don't I know it. It's frustrating having to tell some admin that the Apple laptop that their executive is going to take 1-2 weeks to be repaired when everyone else's system that is on the standards list is fixed that day or the next if the parts are local. And then there's the recent trend for the ignorant to buy netbooks instead of laptops citing the price of $4-600 is far less than the $1200-2000 for a laptop. Then they complain it won't run their apps or is slow. Having the power of a purchase order seems to lobotomize a lot of people into buying the latest and greatest shiny object.

There's a reason why business class laptops are simpler with fewer bells and whistles than consumer models- they are built to last for the entire duration of the warranty. Consumer models come with a one year warranty typically whereas the business models have three.

"As for your comparison of notebooks, you completely forgot all about the cycle. If I can carry a 5-6 year cycle on a laptop (instead of the average 2-3 year cycle on laptops today), then the costs amortize nicely and the price is more than worth it - let alone the lower TCO due to reliability and customer (read - business) satisfaction. "

I didn't forget it at all, and in fact is a very critical reason why I do not believe Apple will do well in the enterprise market. Businesses need that extended warranty. Again, consumer systems come with a one year and business class with a three year. Anything beyond that is pointless as the tech has advanced enough to make a three year old laptop obsolete for the current tech levels. Apple offers a very limited warranty and doesn't offer nowhere near that which HP, Dell, Toshiba, and Lenovo do for on site repairs, parts availability or service. That's just the way it is.

Right now if an exec has a Sony, Acer, or Apple laptop with a failed hard drive, they can expect to be down for 1-2 weeks for the parts to arrive or to have to send the entire laptop back to the OEM for repair depending on their repair process.

If they have an HP, Dell, Toshiba, or Lenovo, then the part can be obtained overnight.

Think about the total cost of ownership then. You must include downtime in that equation. With those standard laptop OEM's, you're looking at 1-2 days max. For Apple, Sony, and Acer, you're looking at 1-2 weeks. That's a long time to have some exec down without a laptop. That's simply unacceptable in a business environment. You then have to start carrying spare systems just to make up the difference. Is that $2500 Apple laptop that is down for two weeks leaving the person stranded really worth that much more over the $1200 laptop that is back up and running the next day? What is that person's time worth? Suddenly the expenses skyrocket and it just isn't that good of a deal at all. The total cost of ownership becomes exponentially higher.

That's a hard and real situation that happens daily. It could easily be improved if Apple allowed others to perform service on their systems or had a parts distribution process for that purpose like the other OEM's in the industry does. Then you could have quick turnaround times. Right now they simply aren't showing any indication of moving towards that model. And until they do, they just won't be considered a serious enterprise provider.


Commander Spock: Is this the first time you haven't talked about OS2 in a comment? is this REALLY Commander Spock? :)
by Commander_Spock January 2, 2009 3:19 PM PST
Re: "Is this the first time you haven't talked about OS2 in a comment? is this REALLY Commander Spock? :)"

Hey " Vegaman_Dan"! Happy New Year to ya. It seem you missed it (grin):

Re: "The "Apple" (Windows) just do not fall very far from the "Tree" (OS/2 Warp) - Huh!"
by Seaspray0 January 2, 2009 4:46 PM PST
I'm still waiting, penguin. Last month you spouted a crock of BS and I called you on it. Why haven't you responded? Because it was a pack of lies and you know it. How about you crawl back into that hole you came from so we don't have to listen to your lies any longer?
by Penguinisto January 5, 2009 12:30 PM PST
"It's frustrating having to tell some admin that the Apple laptop that their executive is going to take 1-2 weeks to be repaired when everyone else's system that is on the standards list is fixed that day or the next if the parts are local."

But you're assuming that the rates are equal. Thing is, they're not... the MTBF numbers for Apple products are far higher than that of the typical (and usually cheap) Dell or HP product.

"Apple offers a very limited warranty and doesn't offer nowhere near that which HP, Dell, Toshiba, and Lenovo do for on site repairs, parts availability or service. That's just the way it is. "

One word: AppleCare. Google it sometime. ;) All it would take to make it enterprise-ready would be for the Apple stores to get stocked with extra parts and a few techs... the infrastructure is already in place.

@ Seaspray: when you're finished with making up situations and accusations, please let us know ;)
by robvme January 1, 2009 11:46 AM PST
Wow, what a rumor....Microsoft could probably use a some trimming but I don't think you are going to see this large of a cut.
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by myles taylor January 1, 2009 11:47 AM PST
Once again, I hope not. :( Microsoft is one of the few companies in the economic recession that has cash on hand. Layoffs are not what are needed in strong companies like Microsoft (Apple comes to mind). Those companies that aren't struggling should be making sure the are putting their workers to good use. The industry can't absorb any layoffs and if the economy goes down further, it will eventually come back to haunt them. Powerfully placed companies like Microsoft can do a lot to actually help the economy (or hurt it).
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by msjonker January 1, 2009 12:10 PM PST
Why does everyone think that when revenue is doing fine, there shouldn't be any job cuts? Should you wait for a disaster before fixing a problem you know about? Maybe you should ask the American auto companies about how this has worked out for them. Trimming the fat is good and using the current economy as an excuse works out well. They are running a business, not a charity.
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by Vegaman_Dan January 1, 2009 12:43 PM PST
I think that there some trimming coming along as MSFT cuts down in the number of contractor / temp to hire positions. I would expect some reduction in MSN as well. But these numbers of 15K are just pulled out of the air.
by gerrrg January 1, 2009 12:46 PM PST
Because revenue is growing at MSFT, and they have a bunch of products coming out this year, so it doesn't make sense to cut back...

that is unless they acquire Yahoo.
by myles taylor January 1, 2009 8:34 PM PST
Because when you lay off workers, you have to make sure that the industry can absorb them. If they can't, it drives the unemployment rate up, especially when you're a company as big as Microsoft. WHen a company is strong enough to ride out bad times, it should. That's not the time to try to trim your extra fat. When a strong company like Microsoft starts laying off, it will just be one more bad thing and it could be the straw that breaks the camel's back. If the economy tanks completely, even Microsoft isn't immune.
by msjonker January 2, 2009 9:50 AM PST
Artificially keeping the unemployment rate down will do nothing to help the economy in the long term. There are thousands of jobs out there that serve no valuable purpose. And when the economy goes south, you get mass layoffs of all those jobs, which only magnifies economic troubles.
by myles taylor January 2, 2009 10:00 AM PST
Actually, "artificially" keeping the unemployment rate down does help the economy. More people having jobs means more money that consumers will spend which could keep the economy afloat until it gets back on it's feet. Now is not the time to be trimming fat.
by MMC Racing January 1, 2009 12:24 PM PST
Quoting a source the starts with FUD is funny.
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by gerrrg January 1, 2009 12:49 PM PST
Maybe someone is perpetuating the rumor of layoffs at MSFT, because they're trying to manipulate the stock price for their personal gain? The SEC ought to take the time to pay attention to stock owners, given that this rumor began circulating very early.
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by michaelo1966 January 1, 2009 1:31 PM PST
Layoffs used to mean firing people, temporarily or permanently, because market conditions no longer supported the jobs. It's difficult to believe that MS wouldn't want to gain market share in any market they're currently in so either a) this is just not true, b) they're letting go ineffective people to make way for more effective people, or c) they've decide to cede ground in areas where they're poorly competing. Of these possibilities the first seems the most likely.
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by Penguinisto January 2, 2009 5:58 AM PST
"It's difficult to believe that MS wouldn't want to gain market share in any market they're currently in..."

How about trying to keep hold of what they have, and trying to prevent any further slippage? Over the past two years, their marketshare in Windows overall has dropped by 5%, and the curve isn't a flat one...
by R_Warren January 1, 2009 3:25 PM PST
>> Mark January 15 in your calendar <<

Umm ... that would be January 14th in Microsoft-speak, me-thinks.
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by neocon4jesus January 1, 2009 4:07 PM PST
Microsoft SUCKS! I use google docs, which is much better than ms word.

And Vista is a total joke!

Glad to see the Karma train is coming into the Bellingham station. RIP Gates and tec thugs.
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by Vegaman_Dan January 1, 2009 8:20 PM PST
FYI: Bellingham is nowhwere near Microsoft. It's 100 miles north on the Washington / Canadian border and is a small college town.

Regarding Google docs- if you read the terms of service, Google reserves the right to do whatever they wish with the content, including copying/selling/marketing it to others without your consent or even your knowledge. While that may not be a big deal to an individual for personal use, it becomes a legal nightmare for any sort of business use.
by myles taylor January 1, 2009 8:35 PM PST
You know, I'm no fan of Microsoft, but come on. I don't want them laying off people in this climate. That will just hurt everyone.
by Broward Horne January 1, 2009 4:34 PM PST
Internet has probably entered an inflection point based on Netcraft host growth. Traffic graphs for MSN and Microsoft show decreasing traffic since winter of 2007.

http://www.realmeme.com/roller/page/realmeme?entry=internet_inflection_point_microsoft

The layoffs are going to be big.
The fall in e-commerce traffic for Christmas was not an anomaly.
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by Penguinisto January 2, 2009 5:59 AM PST
Good point.
by TogetherinParis January 1, 2009 6:23 PM PST
Microsoft should wait for Obama's anti-deflation policy to kick in. Firing thousands of workers in a rough patch should not be Microsoft's legacy. Instead, they should be put to work on MSDOS "7" and be getting ready for the fabulous future that will be Microsoft's counting on the loyalty of employees who can count on their company when things get tough. "Microsoft stuck by me. I will stick by Microsoft!"
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by Philstera January 1, 2009 9:02 PM PST
Is this what passes as journalism these days? A website that cites no sources yet is given front page news on CNET. Your bias against Microsoft is really starting to wear thin.

Since when do you report on rumours and cite actual numbers with a title such as Microsft plans BIG layoffs when there is no proof whatsoever.

CNET is a joke..
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by t8 January 1, 2009 10:53 PM PST
Microsoft bias? Hitler bias. It's all the same.
by doshomik January 2, 2009 5:12 AM PST
From http://minimsft.blogspot.com/2008/12/no-layoffs-at-microsoft-and-round-up-of.html

"NO LAYOFFS @microsoft

Yes, Executives are looking for measures to cut cost. And that can be done without any layoffs. Current hiring rate is slow at MS and considering the natural attrition, we will have lesser workforce at the end of FY09.

We are not immune to recession and our bottom line will see a hit for few quarters. We expect a full recovery by FY10 Q3. We are very optimistic that this recession is an opportunity for us and we will play our cards well. Urge all Microsoft employees to stay focus and keep doing the great work. You will hear more from SteveB soon on his plans. Thank you !!"
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by Penguinisto January 2, 2009 9:31 AM PST
Guess we'll find out.

Pity, though... MSFT can really stand to clear out a lot of institutional dead-wood...
by J. Blow January 2, 2009 10:04 AM PST
http://minimsft.blogspot.com/
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by nutso101 January 2, 2009 6:04 PM PST
Don't we need these workers expertise in maintaining and developing technology in the future?
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by Commander_Spock January 2, 2009 8:49 PM PST
Re: "Don't we need these workers expertise in maintaining and developing technology in the future?" What the answer is going to be is - Why pay for "one" at $75,000 per year when you can get "10" for the same price.
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