Microsoft Brewing Biggest Layoffs Ever

By Steve Anderson July 15, 2014

No one likes to hear about the concept of layoffs. Layoffs have a huge human cost that's tough to bear—particularly for those who endure said layoffs—and a cost that extends outward into the community. So with that in mind, it's particularly disastrous to hear new reports that, not only is Microsoft said to be considering layoffs, but the largest single block of layoffs ever in the company's history.

The reports suggests the layoffs could be announced before the end of the week, and may actually surpass the current high-water mark of Microsoft layoffs, held by the 2009 firing spree that cost 5,800 people jobs. The word in question comes from unnamed sources who spoke with Bloomberg first, and are reportedly part of a larger restructuring effort designed to trim some redundancies between Microsoft's current mobile division and the Nokia Oyj handset unit purchased last year.

But it won't be just handset personnel getting the cut, according to other reports. One report noted that job cuts would arrive in marketing departments like for the global Xbox team as well, a development which might make some sense given that Microsoft has nearly 130,000 employees to its credit after adding around 30,000 back in early June. Meanwhile, Microsoft proper has been engaging in a series of shake-ups to the company, starting with that previous layoff and restructuring, proceeding to a smaller number of much smaller scale restructurings—like a trimming in advertising sales and marketing positions in 2012 adding up to a few hundred total—and ultimately to the installation of a new CEO in Satya Nadella back in February.

Clearly Microsoft is not afraid of change. It's made a host of changes in response to market conditions, working to fend off the growing encroachment of the mobile device market—particularly from Apple, but also from a slew of Android-driven devices—and also making huge changes to its Xbox One gaming system. Back at E3 2013, the company was roundly castigated for its performance therein, revealing a whole slew of new features that no one was really interested in, and from there, demanded change. Microsoft, to its credit, worked quickly in fixing many of these points, and that likely helped turn around the Xbox One's performance. It's still lagging in the field—and that makes firing Xbox marketing staff not the greatest of ideas—but it's proof that Microsoft is willing to do what's needed to have the best chance of success. This approach seems worrisome, but redundancy is tough to accept in business operations, so it may ultimately be for the best, at least for Microsoft. The impact of the firings, meanwhile, will likely be widespread, and hopefully those concerned will find new jobs in rapid fashion.

With Microsoft flagging in hardware—its Windows Phone line is still a third-place finisher against Apple and Android, and its desktop / laptop PC connections are being sorely tested against tablets and smartphones in general—it's making clear advancements to change and make the line more attractive overall to potential users. New tablet-laptop hybrids in the Surface devices, new handsets, a potential new smartwatch, an improved focus on more of a software / service bent with things like Microsoft Lync...all of these add up to big changes at Microsoft. Some of these changes may be more painful to make than others, but at the end of the day, it may well help keep Microsoft viable on into the future.

Edited by Maurice Nagle

Contributing TechZone360 Writer

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