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● 05.31.10

●● Rumours of Additional (Stealth) Microsoft Layoffs

Posted in Microsoft, Novell, Rumour, SCO at 6:38 pm by Dr. Roy Schestowitz

Summary: Microsoft is said to be shrinking, still; at least it’s not as bad as Novell’s situation

ALONG with Microsoft’s many dead products and divisions came many layoffs and other cutbacks (for instance, Microsoft’s Windows Summit was cancelled earlier this month).

=> ↺ many dead products and divisions | ↺ many layoffs | Windows Summit was cancelled earlier this month

Several months ago we showed that Microsoft didn’t quite stop laying off people. Layoffs carried on more silently, with some quiet ones going on slowly (so that investors need not be informed). This new blog post from mini-Microsoft (an anonymous insider) suggests that “stealth layoffs” are still going on, proving that Microsoft is rather frail and unstable.

=> ↺ new blog post from mini-Microsoft (an anonymous insider)

Stealth Layoffs: comments here for a while have been saying don’t expect anymore large layoffs but do expect ongoing stealth layoffs, the kind that don’t trigger the WARN act, let alone publicity. If you see your leadership meeting with HR far more frequently than usual, should you be nervous? Well, first step, ask what’s up. If the answer is unsatisfying and doesn’t ring true: yep, be nervous, especially as FY10 wraps up and new FY11 reduced budgets kick in.

That’s the story of Microsoft. Novell is not doing any better after its results. As the 451 Group put it:

=> ↺ is not doing any better | ↺ its results

But then Novell hasn’t traded on fundamentals for the past three months, ever since hedge fund Elliott Associates launched an unsolicited offer for the company. Novell, which is being advised by JP Morgan Securities, stiffed the bid, but did leave the door open to other ‘alternatives to enhance shareholder value.’ Since Elliott floated the offer, shares of Novell have basically changed hands at or above the $5.75-per-share bid.As a decidedly mixed bag of businesses, Novell isn’t the cleanest match for any other company that might want to take it home. For that reason, most speculation around a possible buyer for Novell has centered on private equity firms. (The buyout shops are undoubtedly licking their chops at the prospect of picking up Novell’s $600m of maintenance and subscription revenue, not to mention the $1bn that sits in the company’s treasury.) However, we understand from a person familiar with the process that there are a handful of strategic buyers still interested in Novell.

What would happen to the SCO case, which is still an ongoing issue? Novell-oriented Web sites act as though it’s business as usual [1, 2], but a sale of Novell seems imminent and Novell's arsenal of software patents may be a ticking time bomb (UNIX withstanding). █

=> ↺ still an ongoing issue | ↺ 1 | ↺ 2 | a sale of Novell seems imminent | Novell's arsenal of software patents may be a ticking time bomb

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