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SGI Announces Restructuring, Cuts 400 Jobs

Posted by ryuzaki0 on from the downsized-layoffs dept.

kerneljacabo writes "Yikes! SGI seems to be the lastest victim of the economic downturn. Today they announced an extensive 'restructuring,' which includes releasing about 10% (400) of their employess. Seems like no one is immune." SGI claims this'll save them $40M, as well as improve their performance next fiscal year.

2 of 310 comments (clear)

  1. Aw, crud. by Skyshadow · · Score: 5, Insightful
    I interned at SGI (Chippewa Falls '98), I have friends who work at SGI, I surfed /. from SGI...

    It seems to me that SGI's major problem is that they were always a one-trick pony -- they made the decision to stick with graphics machines at a time when that particular niche was sliding towards being a commodity, or at least commodity-doable. When Jurrasic Park came out, it was like a birth cry. When Titanic came out, it was a death toll.

    They tried to branch out, but their directionless, clueless management (I'm looking at you, Chainsaw Rick Belluzo) flailed around towards one ill-concieved scheme after another, and all the while powerful PC-based workstations were dropping in price.

    IMO, they should have concentrated on appliances. I remember pilot programs floating around to do things like massive network storage (a la NetApp) and other similarly promising things, but they never went anyplace.

    Oh, and I had a Herman Miller Areon and an office. As an intern. Might have been a symptom of part of the problem, on reflection...

    --
    Every year during my review, I just pray the words "slashdot.org" aren't mentioned.
  2. Nothing to do with cash reserves by fm6 · · Score: 5, Insightful
    SGI has been in trouble for a long time. Now that commodity computers are so powerful, nobody goes to them for graphics workstations. That leaves them with supercomputer/servers, and "visualization stations" (basically supercomputers configured as very expensive workstations). They've never done well in the server market: it's hard to compete with IBM and Sun, plus their "Jurassic Park" image is a hard sell in the coporate world. They do better with the VW market, but that's not enough to keep them in espresso.

    When I worked for them in 99, they already had cash flow issues, and had had them for some time. But Wall Street has always loved them, so they always got more cash when they needed it. Many people who worked there thought this was actually a bad thing. I guess Wall Street has finally figured out that their business model is just not working.

    I went from SGI to Borland, which has cash up the wazoo. They got a huge patent settlement (disguised as an investment) from Microsoft, and have mostly been in the black lately. But Wall Street doesn't trust Borland: too much weirdness. (Personal trauma prevents me from being specific.) So we were always under pressure to cut costs. I once had to go all the way to Dale Fuller for a $200 memory upgrade!

    Publically held companies live and die at the sufferance of Wall Street, no matter how well, or how badly, they're doing. I imagine that's why Google is still privately held, even though an IPO would make a lot of the people there -- maybe not rich, but certainly comfortable.