Bonum Certa Men Certa

Preliminary Look at Microsoft's Layoffs and Hogwash

Whither Wintel?

Happy pig
Founded in 1975, Microsoft (Nasdaq “MSFT”) is the
worldwide leader in putting lipstick on a pig.



WE WROTE ABOUT THIS very briefly last night and we shall come back to it over the weekend with a more detailed analysis. There is a lot of deception and spin out there, so it's time to dispel just a few misconceptions that are being spread too rapidly to counter.



Regarding layoffs: A day or so before the announcement leaked prematurely, people had been talking about it as the likely outcome, which clearly surprised some investors because the stock fell sharply.

The worldwide economy isn't doing so well, as the recession is affecting almost every branch of the industry. It now seems that, although Microsoft considers its Xbox 360 console and its whole game and entertainment division recession-proof, things aren't going too well with the other departments in the major corporation.


Actually, given the massive losses and failures amassed by Microsoft's game and entertainment division, this is a laughable thing to argue. Shortly after disclosure of the results, Eric Lai, who runs a Microsoft-centric blog at IDG [1, 2], was simply unable to deny Microsoft's troubles.

Windows client division fell 8% because of delayed corporate upgrades of PCs and cannibalization of consumer notebook sales by netbooks installed with Windows XP.

[...]

A $100 million drop in the sale of Zune devices contributed to a 60% decrease in the entertainment and devices division's operating income, to $151 million. Strong sales of Xbox 360 consoles, however, helped lift revenue 3% to $3.18 billion.

Microsoft's weakest financial performer was its online services business, which continued its money-losing ways. Revenue from Web advertising and subscriptions to services such as Windows Live Hotmail was flat at $866 million in the second quarter, while the loss nearly doubled (91%) to $471 million.


As we stated yesterday, if non-permanent employees are accounted for, then Microsoft may have just laid off (or let go of) over 10,000 people. Its profit is claimed to have sunk by 11% (one can't ever trust Microsoft's words) and Microsoft insists on seemingly small numbers because it prefers to refer to how many people get fired immediately (damage control by selectivity).

Microsoft is slashing 5,000 jobs after it posted a profit of $4.17bn, or 47 cent per share, in its second quarter earnings report, undershooting Wall Street expectations.


Microsoft blamed "Netbooks," which is a nice way of avoiding the use of the word "Linux". Had it not been for GNU/Linux, would Microsoft have given Windows away for as little as $5 apiece?

It's worth adding that Microsoft's partner in crime [1, 2, 3, 4, 5, 6, 7, 8, 9, 10] is laying off thousands of employees as well (potentially more than Microsoft).

INTEL ANNOUNCED it will shut five manufacturing facilities, affecting the jobs of 5,000 to 6,000 employees.


SJVN says that people should mark their calendars and remember this as the date and critical point where Free software put an end to dominance (or omnipotence) of proprietary software and its accomplices. Red Hat, for example, is doing exceptionally well despite the global slump.

We will discuss this further in a matter of days. As one reader puts it, "Microsoft only publishes material favorable to its agenda even if it is falsified. The real facts are often available, at least for a duration."

"Mind Control: To control mental output you have to control mental input. Take control of the channels by which developers receive information, then they can only think about the things you tell them. Thus, you control mindshare!"

--Microsoft, internal document [PDF]

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