Microsoft facing significant job losses?

by Sutton Dagger

© 2008 Steven Sutton:

The current economic climate is affecting even the big players with recent news that Sony would cut 16,000 jobs and pull out of business to save $1.1 billion a year, due to the financial crisis.

In even more recent developments, Electronic Arts, one of the largest interactive entertainment publishers have reported staff reductions of up to 1,000 employees; this amounts to around 10% of the entire EA workforce. These are nearly double the initial lay-off figures first reported, with the ever changing financial environment forcing ever further changes.

Today some interesting rumours have surfaced regarding significant lay-offs and cutbacks at Microsoft. If the rumours are to be believed, Microsoft will be facing considerable reductions in staff across the board. These would encompass the bottom performers (10% of the entire Microsoft divisions) resulting in 5,000 to 10,000 job losses.

It still isn’t clear where the majority of staff reductions will come from but cuts to the games division are also likely. How this will affect Microsoft’s stance in the gaming industry is unclear but come January 15th 2009 we will find out the extent of these cutbacks.

Excerpt from Recent conversations-posts

What have those fine folks been sharing over the past couple of posts here? Bad news on the rise and with perhaps January 15th 2009 as an interesting day for Microsoft news. Bad news. 15 Jan is a week before FY09Q2 quarterly results and it’s better to share as much news, good and bad, before the results are released vs. surprising Wall Street (something I think we’ve learned).

It all starts with…

Just heard on the finance grapevine. MSFT layoffs are coming on January 15th.

They are substantial.

And then some curious meetings:

they lost 12 people in STB [...] looks like “feedback” reviews are underway to get the a-10’s out of the picture as well.

What kind of meeting? Perhaps like:

I got invited into one of those special “manager” meetings on thursday which resolved to absolutely zero activity other than asking opaque questions for which the answer was already known.

“fact” finding in order to dismiss an argument OR dismiss me

shall find out 1/15

In Live Meeting:

Live Meeting is one of the worst places to be right now – and it has gotten downright hostile and strange in recent times. People are pulled into meetings with management where they get interrogated about what they are working on (”We want to hear what you think you know about XYZ, this is not a knowledge-sharing session…”), people are given impossible tasks like coding things not yet designed, automating things not get coded, documenting unfinished ideas (all subject to being cut next week too). On top of that they must account for their time by the hour. Live Meeting is in its death throes.

Breaking-up when you have no budget is another tactic (in STB):

Our 120+ person org has just been broken up due to lack of budget. About 1/2 the team is staying, the other half is going to a number of different teams within the larger org. So far, we all appear to have jobs, but man, what a shocker, I thought ours was one of the more stable teams.

Not sure what happens to our Director, he seemed a bit shocked himself when he delivered the news today. I also don’t know if this is the first step towards a lay-off, but for now, it seems we’ll have jobs for a few more months.

Ugh, not good, not good at all.

STB again:

I got pulled into a lunch 2:1 today and got given good news on “you have 4 weeks left”

STB – > Server

Rumors! Like the following that I’ve heard wandering around chatting with folks before the holidays:

I’ve been hearing some stealth layoffs around the SQL and BOSG groups, around 70+ people were given 6(?) weeks to find another position within the company, otherwise they are laid off.

Anyone know others?

Is the following a list of head-count cuts or expected percent cuts?

• 3 in omps
• 9 in stb
• 12 in msd
• 7 in devdiv
• 18 in UA
• 5 in MSX

Source

We are not saying these are ‘real’ but they bear the substance of being close to the bone. And like all things, will be met with the usual “We do not comment on rumours and speculation” which is natural.

What we do know is, that many companies, large and small, no matter HOW large will and are feeling the pinch at the moment. As with the bigger companies, they rely heavily on much higher returns to fuel their ongoing structures.

Without that return, even by as little as several percent, it has a huge flow-on affect within the company as a whole.

We will keep you posted as more news or information comes to hand.

© 2008 Steven Sutton:

Please share us around