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UK fear as Microsoft 'poised to axe 15,000'
Rosamund Urwin2 Jan 2009
There were fears for hundreds of jobs at Microsoft's offices in Reading and London today amid reports that the software giant is set to axe up to 15,000 staff worldwide.
In what would be the first major cuts since the company was founded 32 years ago, between 10% and 17% of its 91,000 global employees are thought to be facing the chop.
Speculation of staff cuts has been sparked by reports from technology blog website Fudzilla, which claims employees have been told the group is "readying major lay-offs to its worldwide operations" on 15 January.
The cuts are expected to take place a week before Microsoft reports second-quarter results. Online division MSN is likely to be among the hardest-hit, while rumours are that Europe, Middle East and Africa division Microsoft EMEA will suffer more than its US operations.
But experts say console-division staff should largely be spared after strong sales of its Xbox 360. Microsoft UK, the company's largest subsidiary, employs 1500 in its Thames Valley Park head office near Reading and in Cardinal Place, Victoria.
It is the latest bit of gloom to come out of the technology sector, where there has been a string of profits warnings in the past year.
Last February, British bluetooth technology specialist CSR, which makes wireless technology for laptops and mobiles including Apple's iPhone, warned demand for its products had plummeted.
Microchip maker Wolfson Microelectronics said in October that revenues would be well below analysts' forecasts as the slowdown in consumer spending hit sales.
Then Japanese electronics giant Panasonic, previously considered to be almost recession-immune, stunned the markets by issuing a mega profits warning. Microsoft chief executive Steve Ballmer is tipped to unveil a new version of the Windows operating system when he speaks at the International Consumer Electronics Show in Las Vegas next week.
The world's largest software company is expected to face increased competition in 2009 from a resurgent Apple, whose Macs have been eating into Windows' share of the PC market.
Reader views (3)
There's long been a lack of innovation at Microsoft. Same old bloated software, security holes are still prevalent, and the software is unpleasant to use.
- Mac & Linux User, London, 05/01/2009 12:14
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Bye bye governments. Hello "corporate governance" literally.
- James, Leicester, 05/01/2009 00:33
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Britain is not an attractive investment place anymore and a lot of foreigners are waiting until there is a government election. Pound sterling will continue to slide in the mean time now less than 1 euro.
- Jacqueline, Hampstead, London, 02/01/2009 18:13
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