Mi­crosoft im­ple­ments 'some' job cuts, re­or­ga­nizes sales

Kuwait Times - - TECHNOLOGY -

Mi­crosoft said Thurs­day it was cut­ting an un­spec­i­fied num­ber of jobs amid re­ports the US tech gi­ant was re­or­ga­niz­ing its global sales op­er­a­tions. "To­day, we are tak­ing steps to no­tify some em­ploy­ees that their jobs are un­der con­sid­er­a­tion or that their po­si­tions will be elim­i­nated," Mi­crosoft said in an email re­sponse to an AFP in­quiry. Ear­lier, CNBC tele­vi­sion said the com­pany would be cut­ting some 3,000 po­si­tions, mostly from its non-US sales staff.

"Like all com­pa­nies, we eval­u­ate our busi­ness on a reg­u­lar ba­sis. This can result in in­creased in­vest­ment in some places and, from time-to­time, re-de­ploy­ment in oth­ers," the com­pany said in a state­ment. The lay­offs come as the US soft­ware colos­sus re­fo­cuses its sales force on mak­ing Mi­crosoft a piv­otal part of busi­nesses re­ly­ing on cloud com­put­ing, ac­cord­ing to me­dia re­ports. Mi­crosoft had more than 121,000 em­ploy­ees world­wide at the end of March, ac­cord­ing to its web­site.

Chief ex­ec­u­tive Satya Nadella has sought to re­duce the tech gi­ant's fo­cus on soft­ware, shift­ing to cloud com­put­ing and busi­ness ser­vices."From large multi­na­tion­als to small and medium busi­nesses to non-prof­its all over the world, or­ga­ni­za­tions are us­ing Mi­crosoft's cloud plat­forms to power their dig­i­tal trans­for­ma­tion," Nadella said when the com­pany re­ported its earn­ings for the first three months of this year.

Over­haul in tech

Global Eq­ui­ties re­search an­a­lyst Trip Chowdhry saw lay­offs such as those tak­ing place at Mi­crosoft as symp­toms of a tech­nol­ogy in­dus­try un­der­go­ing a "ma­jor over­haul" caused by a shift to com­put­ing and on­line ser­vices be­ing hosted in the in­ter­net cloud. "This is not the end," Chowdhry pre­dicted. "At com­pa­nies tran­si­tion­ing from the old world to the new world you will see lay­offs ac­cel­er­ate; it's a slow and grad­ual and painful ex­pe­ri­ence for them."

Mi­crosoft Azure and Ama­zon Web Ser­vices are the dom­i­nant "su­per-clouds" for com­put­ing, ac­cord­ing to the an­a­lyst. With su­per-cloud com­put­ing plat­forms, resources can be fo­cused on re­fin­ing and sup­port­ing a sin­gle ver­sion of op­er­at­ing soft­ware in­stead of ver­sions re­leased ev­ery year or so to be in­stalled on ma­chines in homes or busi­nesses, he rea­soned.

"You look at Mi­crosoft, and you re­al­ize that cer­tain things that worked in the past are not go­ing to be rel­e­vant in the fu­ture," Chowdhry said. Mi­crosoft has been shift­ing to a cloud-based model un­der Nadella, as the in­dus­try moves away from pack­aged soft­ware that once was the core of its busi­ness. Mi­crosoft said rev­enue from its "In­tel­li­gent Cloud" rose 11 per­cent from a year ear­lier to $6.8 bil­lion.

Mi­crosoft is to re­lease its earn­ings for the re­cently-ended quar­ter on July 20. Mi­crosoft's cloud plat­form, called Azure, faces com­pe­ti­tion from tech­nol­ogy pow­er­houses Ama­zon and Google. Each of the com­pa­nies has also been in­vest­ing in ar­ti­fi­cial in­tel­li­gence which can make ser­vices hosted in the in­ter­net cloud more in­tu­itive and in­sight­ful when it comes to han­dling data or cater­ing to needs of users.

Red­mond, Washington-based Mi­crosoft has an­nounced thou­sands of jobs cuts in re­cent years, the most se­vere be­ing 18,000 po­si­tions elim­i­nated in 2014 re­lated to its ac­qui­si­tion of Nokia and failed ef­forts in the smart­phone mar­ket. The tech­nol­ogy gi­ant cut 7,800 jobs in 2015, and 4,700 last year. Mi­crosoft com­pleted its $26 bil­lion ac­qui­si­tion of the pro­fes­sional so­cial net­work LinkedIn late last year as part of its new strat­egy.

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