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Corel Cuts 220 Jobs to Save $12M
Cecil writes "Just saw this story on the City of Ottawa's website:
'The Software maker Corel Corp. is cutting 220 jobs - more than a fifth of its workforce - in a bid to reduce costs and return to profitability amid weak technology spending.'" Of course, this stinks for those who are laid off, but hopefully Corel can turn things around.
That isn't the city of Ottawa web site, thats a local news web site. If you want the City Of Ottawa's web site, check out http://www.city.ottawa.on.ca/
Cash strapped and confused as Corel may seem, this move would appear to me to be a consolidation and focusing of Corel's main products (those being WordPerfect Office Suite et al.)
In fact, having a former life in the photographic industry, I could never figure out what Corel was doing in the stock photographic / images business anyhow. The quality of their libraries were fairly well below the industry normals in addition to some fairly draconian and muddled contract agreements.
In particular, there was an instance where a former employer of mine used some Corel stock images for their catalog. The photographer who actually took the shots summarily attempted to sue my former employer. When Corel was contacted, we learned that certain images in the library were still property of the original artist.
This caused us some deal of confusion since this is not the not the norm for stock photographic images.
This is a prime example of a company getting into a business they really didn't understand (Corel), its about time they started dumping their ancillary business and focusing on software development, rather than services like stock imagery.
average out to be 54k / person.
which means that if we bell curve it, there are some highly paid individuals being cut. probabbly software engineers, maybe some management.
I have heard somewhere that when a company start cutting engineers, then the company REALLY is not doing so well. I wish them luck regardless, though. They make some nice software.
but then the 12M may not be all from job cuts, though - so I am just blabbing, actually.
My life in the land of the rising sun.
I have to say that as an ex Corel Linux employee who saw what happened inside the organization that it is grossly inaccurate to say they dropped it on the marketplace and expected it to sell itself. They did run paper advertisments and were dedicating half or more of stand space to Linux and it's (wine'd) Office suite (Draw et al having the other half).
I think the reason they didn't get very far is:
What could they do in the face of this? Could they re-write all the incompatible sections to placate us....NO they couldn't afford to. Could they change from wine for Linux apps... NO they couldn't afford to, they weren't getting money from Linux so in the face of the cost cutting required it was hard to justify expenese on Linux that might actually produce money from Draw/WP 10.
Where next......well after their minor success with their unix WP7/8 and an old draw I think they will be back to the Linux marketplace with a native app, the only questions are how long must we wait, will it be worth it or have MS killed it?
Ultimately I cannot see many/any traditional shrink-wrap software companies converting well into Linux land, they can't comprehend the underlying concept of using the GPL (not just LGPL) stuff out there and releasing products based on support et al rather than licensing revenue. Why didn't Corel just port their whole App suite to Gnome/KDE2 on all platforms rather than work on KDE and wine?
All of their problems probably would have been solved had it not been for the change in relative stock prices of Corel and Borland between the initial merger announcement and the critical dates. What was an attractive deal for both sides become a wholly unappealing deal for Borland shareholders and Corel lost a stay of execution AND the combined "powerhouse" that should have arrived on the Linux platform.
Disclaimer. The above are the conclusions I have drawn from my observations.....not the facts cause I don't know them....as if you all couldn't tell :-)
I don't see why the "MBAs of Wharton and Harvard who run the country" should have to explain about a Canadian company laying off workers....
I think that Corel's failure was the fact that people pirate MS Office, and don't care to try out less expensive office suites.
In my opinion Corel Office was much more intuitive, yet, in my school, there is not one person excluding myself who doesn't pirate software. In fact teachers indirectly encourage students to get MS Office off Kazaa or "to borrow it from a friend"
It is really really sick.
We must stop piracy in the education system, it'll save good companies like Corel.
Infuse, say, $20M into the company with a promise for Corel WordPerfect for OS X, and maybe stronger ties between Corel's graphic products and OS X...
GPL Deconstructed
As I hear about these continual massive layoffs, I wonder if the ex-employees are keeping in touch. Most of them probably haven't looked for a job lately, so it will take them a little time to get back in to it. Also it's important for them not to feel bad about it. They will go through a life-changing event, and there will be hundreds or thousands of people going through the same thing in a conveniently small geographical area, so it would be great for them to help each other and at least use each other for networking.
I guess I'm just proposing something like www.exemployees-forum.com.
I've always thought that an economic slump is the BEST time to agressive hire the best workers so that when the times change, they are in a great position by having the best on staff in place. People without money (cause they lost jobs) won't buy half ass products (due to having smaller staffs working on them). It's as simple as that. Times like this is when companies should be MORE aggressive and buy every good idea and worker, because they will sell for less and be more likely to be grateful when times turn around.
Whatever, it's not like I studied economic theory...
Burn Hollywood Burn
Lets see. Factor in the exchange rate, and you're down to $35,000US a year. Then when you remember that the annual cost of an employee is alot more than their base salary alone. Typically youy can assume that an employee costs about twice his salary, with taxes, overhead, benefits, etc. Now we're down to 17,500 roughly. That's $8.75/hr.
The Starbucks the next block over, is hiring Barista's for $9.
"Politicians are interested in people. Not that this is always a virtue. Fleas are interested in dogs." P.J. O'Rourke
Draw, Wordperfect, Office, etc etc. All the while they're creating ports of .Net to FreeBSD (that won't generate any revenue) and other various frivolous projects. This is a little bit like the plight of Sonic Foundry; getting into video and creating five different audio suites really dilutes the manpower to create great applications.
What Corel needs to do is concentrate on one product and make sure it's the best in the business. Go after Photoshop. Go after Office (well, on second thought, don't). But don't go after both at the same time.
Part of the problem is that all of the young hotshot twenty-somethings don't yet realize that they're on the block next.
These kids went to school, got headhunted, got a $40k salary and got stock options just like that without ever really having to think about anything. Sure, they think they're working hard, but there's just no comparison, for example, to the much more grim and realistic world experienced by kids graduating from college during the Carter years (to chose an epoch at random). The economic slide hasn't hit the current group of young adults hard enough yet; they still believe it's the nature of existence to have cash in hand and food on table and they basically consider anyone who doesn't to be a lazy bum or an idiot. They have no connection whatsoever to the concept that one can be qualified, willing, and actively searching for work and yet still end up starving.
Give it a few years. If this economic downturn starts to hit enough dotcom kids, you'll begin to hear Athese same anti-union love-Bush American kids begin to cry like babies and maybe even have some sympathy not only for laid off Americans but also for other peoples around the world, who even today in the first world are struggling much harder in many places.
STOP . AMERICA . NOW
Let's take an overview of what Corel sells:
- WordPerfect. Matches every feature of Word, and throws in a few more: Reveal Codes, and a SGML mode, plus frame placement that actually works.
- Paradox. An awesome database engine. Far better than Access, last I read from the pointy-heads that know this sort of thing.
- Quattro. At least up to Office 97, it matched Excel for features. I haven't the foggiest what either company has added (or even could add!) to the spreadsheets, so I don't know how they compare now.
- Ventura Publisher. Its only competition is FrameMaker. It has far better typographic controls and UI, plus it comes with a database publisher that simply rocks, and XML import that appears to be more powerful than FrameMaker's.
- Corel Draw. It is awesome. I think it can be argued that it's the best general-purpose vector illustration program out there.
- PhotoPaint. It's easily as good as Photoshop. It does have a rather different UI, but the power is there.
- XMetaL. From the recent SoftQuad purchase, it is one of the best XML creation/maintenance engines out there. Coupled with Ventura for publishing to print, and it's beyond compare.
- iGrafx. From another recent purchase, these are a set of Process/Workflow tools that are incredible.
- Painter. From its Metacreations purchase, Painter is an incredible "natural media" simulation. It's a world apart from Draw and Paint, and a helluva lot of fun.
I think that pretty much covers their major product list.
Each and every one of those products ranks in the top three for its category in terms of functionality.
Unfortunately, Corel has several things going against it:
- Major (and foolish) Mac bias in the graphics/publishing market.
- An incompetant marketing department.
- A history of buggy product releases (though the inevitable service packs always help a lot).
And, of course, there's always the harsh reality that the best products don't always come out on top... and we're all familiar with some really crappy products that are dominating the market.
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The anti-union attitudes of /. editors is astouding sometimes
A company is not a social program. Once more, a company is not a social program.
A company, any company, exists to provide a product or service that results in what most folks hope is a positive cash flow. If that is the result, it will grow. In that growth will certainly be newer jobs.
The reverse is also true. If a company has proven that it cannot make money, it will shrink. In it's shrinking, fewer employment opportunities exist.
No union, legislation, or any other happy thoughts can change this basic economic fact. When a company, like Corel, is no longer producing products that customers wish to buy, fewer jobs will result. How can you maintain staffing rates of old when you no longer have the cash to pay them?
The US has gone from a "right to work" country to a "right to get fired" country, almost within a few years. The focus on "keeping corporations profitable EVERY SINGLE YEAR" is absurd.
Nevermind the fact that we're actually talking about CANADA here. There has never been, in ANY nation a "right to work". Oh sure, there have been lofty attempts with subsequent failures, but the concept simply doesn't exist in the wild.
First off, a "right" is not what someone does for you. A "right" is what the government can not do to you. Just as true in Canada as the US, or any other country for that matter. At most, something a government does for you could only be described as a "social program".
Please refer to the beginning of this post... repeat as needed.
The line must be drawn here. This far. No further.