Intel To Lay Off 1000 Managers

sprash writes to mention a Forbes article about an Intel cost-cutting measure. In response to stiff competition from AMD, the company is laying off 1000 managerial positions. From the article: "In April, Intel reported a 38 percent drop in first-quarter profit as demand slackened for PCs and microprocessors from AMD continued to steal market share. That same month, Chief Executive Paul Otellini vowed to spend the next 90 days identifying underperforming business groups and cost inefficiencies in an effort to save the company $1 billion a year. He said he planned to make changes as his analysis progressed, rather than waiting until the end of his review."

Comments

Only the First Shoe to Drop

[ackthpt]

In my experience it's middle-managers who go first, then after consolidating groups and departments, headcount follows. If this is 1% of Intel's workforce then there's likely 5% or more to follow, which would be 5,000 or more when the next boot hits the Linoleum.

It's inevitable when a business loses a significant amount of market share and only the most ignorant Intel employee wouldn't see this coming. I wish them luck. This is probably more a move to maintain profitability and stock value (got to convince those anaylists on Wall Street you're minding your P's and Q's) than "streamlining for growth", which is exactly what you hear when they are doing major houseclearing no matter whether the house is merely smoldering or engulfed in flames.

The pity is those most responsible rarely are held to account for keeping a business trundling along only to be blindsided something some from the inside saw coming, but weren't taken very seriously (Yamhill). Intel may pare their losses, but they'll never enjoy 90% market dominance again.

Re:Only the First Shoe to Drop

[Anonymous Coward]

Of course, they could be retrained for jobs in the computer industry. A few of them might even be qualified.

Re:Only the First Shoe to Drop

[lixee]

Intel may pare their losses, but they'll never enjoy 90% market dominance again.

Looking forward to the day when this will be said about Microsoft.

Re:Only the First Shoe to Drop

[davidsyes]

7 more shoes to go? (as in huge octopus?)

Re:Only the First Shoe to Drop

[ackthpt]

7 more shoes to go? (as in huge octopus?)

I worked for a company that went through 7 rounds of layoffs in about 14 months. They started with paring away a few middle managers, including mine, to "streamline" the company. It did anything but that. The remaining rounds were hacking away at necessary people until there were only keystones left. When suddenly a customer (Hint: Think big computer company in Austin, TX) proclaimed they were happy with the level of service they were getting and wanted to step it up, which would have put the company very far into the black, the executives had to confess they no longer had sufficient staff to handle the load. The customer elected to dump us and that was all she wrote.

Re:Only the First Shoe to Drop

[Anonymous Coward]

"the executives had to confess they no longer had sufficient staff to handle the load"

It is odd that hiring/rehiring never came up as an option. Perhaps the golden parachutes had already been handed out (anti-motivator). If not, then I can't think how that scenario played out. Any insight? Or is this just a disgruntled employee story which 1/2 the story is only available?

Re:Only the First Shoe to Drop

[pedalman]

When suddenly a customer (Hint: Think big computer company in Austin, TX) proclaimed they were happy with the level of service they were getting and wanted to step it up, which would have put the company very far into the black, the executives had to confess they no longer had sufficient staff to handle the load. The customer elected to dump us and that was all she wrote.

Ahhh, the Peter Principle in all its glory.

Re:Only the First Shoe to Drop

[iwsnet]

If the managers go first, then they would likely lay off at least 5,000 more.

Re:Only the First Shoe to Drop

[ackthpt]

Ahhh, the Peter Principle [wikipedia.org] in all its glory.

Not quite. It became apparent after the doors were closed and people could speak freely that the company was being squeezed on purpose. A shrinking company is more profitable than a growing one, but only so far. This lined someone's pockets with "administrative fees" while they lose other people's money and livelihoods.

Where are those anti-trust advocates now?

[dada21]

I remember over the years how a bunch of the regular mods used to mod me down as troll when I defended Intel against the "they're a monopoly!" posts. For the newbs here, Intel in the past was right up there with Microsoft now, IBM in the 90s, GM in the 80s, etc. Intel wasn't a monopoly, they were just a very aggressive company with a great marketing system, great support, great products and happy customers. As I said many times (I wish I could dial back to quote my old posts), Intel's future would be as shortlived as IBMs was, as Atari's was, as GM's was -- there is no need to start screaming anti-trust! anti-trust! when a company you don't like seems like they'll never fall. I said Intel would have its down days, just as I say today that someone will beat Microsoft fair and square some day, too.

Here are some posts that I recall people talking about Intel being a "bad monopoly," looking back in recent slashdot times:

Timeline Set for Intel/AMD Antitrust Trial
Intel and Skype Exclude AMD
AMD Files Antitrust Lawsuit Against Intel
Japanese Government Raids Intel Tokyo Offices
AMD Alleges Intel Compilers Create Slower AMD Code

Of course, some people will defend their "Intel is a monopoly" belief by saying they're not really a monopoly, they just engage in anti-competitive practices. Like what? Lowering prices below market value? That is _good_ for consumers because NO business can sell for a loss forever -- the minute that they raise their prices after they've wiped the competition clean, new competition will turn up the beat them down again. It has to be good prices, good quality hardware and good quality support -- if they want to give items away, let them. The other anti-competitive practice we hear about is how they "force" suppliers to buy bundles or maintain a certain ratio of items sold to branded items bought. Again, this is all acceptable if the contract stipulates these situations -- most suppliers are happy to sign agreements if they know what the customers want.

I'm glad to see these big companies fall because they're all colluding with the various governments to maintain their power through what I consider negative rights -- copyright, patents and ridiculous mandates requiring their products. Some even have defense contracts. They fall because the customer decided -- there are no natural monopolies as long as the customer is given the opportunity to make their decisions. The market will decide the victor, and the victor won't be on top for long.

Re:Where are those anti-trust advocates now?

[ackthpt]

I said Intel would have its down days, just as I say today that someone will beat Microsoft fair and square some day, too.

Could it simply be a matter of action was necessary to keep the playing field level, so a fair competitor such as AMD with an excellent product would even have a chance? If Intel simply dropped CPU prices each time AMD looked like they were about to turn enough profit to channel investment into better products, you would still have AMD following Intel's shadow with cheap knock-offs of the lower end of the product line.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

As I said many times (I wish I could dial back to quote my old posts), Intel's future would be as shortlived as IBMs was, as Atari's was, as GM's was -- there is no need to start screaming anti-trust! anti-trust! when a company you don't like seems like they'll never fall. I said Intel would have its down days, just as I say today that someone will beat Microsoft fair and square some day, too.

Well of course someone will beat them. Even the East India Company didn't last forever. That doesn't say anything useful about the legalities of Intels actions or whether their impact on the market was good or bad. People live and die, companies come and go, empires rise and fall. That doesn't mean that nobody is ever culpable for anything.

Re:Where are those anti-trust advocates now?

[rainman_bc]

That is _good_ for consumers because NO business can sell for a loss forever -- the minute that they raise their prices after they've wiped the competition clean, new competition will turn up the beat them down again.

Not necessarily. It takes enourmous amounts of capital, and even more importantly, reputation to compete in the processor space. It's not like anyone can jump on that...

Recall the success of Cyrix, and consider the success of Transmeta and Via today. The processor space is currently about reputation. AMD started getting some respect around the time of the Athlon.

Re:Where are those anti-trust advocates now?

[WilliamSChips]

Cyrix was bought by Via. And I'm pretty sure Transmeta no longer exists. But anyways, people like dada like to pretend that capital magically comes to you with the Capitalism Fairy or something.

Re:Where are those anti-trust advocates now?

[merreborn]

It takes enourmous amounts of capital, and even more importantly, reputation to compete in the processor space.

Damn straight -- startup costs in that industry are measured in billions of dollars. AMD's new plant is going to cost them $3.2 billion.

Re:Where are those anti-trust advocates now?

[GlassHeart]

Lowering prices below market value? That is _good_ for consumers because NO business can sell for a loss forever -- the minute that they raise their prices after they've wiped the competition clean, new competition will turn up the beat them down again.

You are wrong. Every business has a barrier to entry, and a new entrant always risks losing the resources they spent overcoming that barrier. If a monopolist is allowed to sell below cost to get rid of a competitor, it creates a chilling effect even if they later raise their prices. A new competitor must consider what happens if the monopolist does it again, and if the barrier to entry is already high (a fab, for example), the competitor will think twice and walk away instead.

Sure, if competitors keep showing up, the monopolist cannot withstand the losses forever. However, everybody except the last competitor who dethrones the monopolist loses, and nobody wants to be cannon fodder.

Re:Where are those anti-trust advocates now?

[kfg]

. . . they're all colluding with the various governments to maintain their power . . .

Bingo!

And thus they have no real cause for complaint when the government bitch slaps them now and again for getting out of line.

Render unto Caesar. . .

KFG

Re:Where are those anti-trust advocates now?

[Sebastopol]

Are you seriously comparing IBM and Atari? Seriously!?!

IBM is a CENTURY old old, a market cap bigger than Intel -or- GM, still a value giant with massive capital and a solid product base (which to its credit completely shifted its service division to nimbly adapt to 80/90's technology shift), and shows no sign of going away.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

new competition will turn up

Why, so they can blow billions on chip design and fabrication only to have Intel pull the rug out from under them whenever it wants? Capitalism can do a lot of things, but self-regulation isn't on the list. Nobody can trust a company to "play by the rules" when money is on the line, unlike a mouse who has learned that they get a shock if they push the red button, they'll leap for the button the instant they think they'll get away with it.

Re:Where are those anti-trust advocates now?

[Chris Burke]

Intel wasn't a monopoly, they were just a very aggressive company with a great marketing system, great support, great products and happy customers.

I won't argue against the description in the last half of this sentence, but you are on a dangerous crack/heroine mix if you think Intel wasn't a monopoly in desktop PC processors.

As I said many times (I wish I could dial back to quote my old posts), Intel's future would be as shortlived as IBMs was, as Atari's was, as GM's was -- there is no need to start screaming anti-trust! anti-trust! when a company you don't like seems like they'll never fall. I said Intel would have its down days, just as I say today that someone will beat Microsoft fair and square some day, too.

I wouldn't light the candles on your "The market's Invisible Hand has proven me right!" cake yet.

First, what even makes you think this vindicates your "not a monopoly, market corrects itself magically" position? This is not the first time Intel has layed off workers. This is not the first time they have had a large downturn in revenue.

Second, what is the only reason you could come close to saying that Intel has lost their monopoly position? AMD.

Who would not exist were it not for the restraints placed on Intel by anti-trust laws? AMD.

It would have been so easy for Intel to kill off AMD if they could have used their position with impunity. They could have "cut off the air supply" of AMD in a way that would have made Bill Gates weep. Microprocessors are not like operating systems. There is a very real and very expensive investment in manufacturing facilities necessary. If Intel had, say, given the OEMs the ultimatum to stop selling AMD or pay double for Intel parts after AMD had built and bought the equipment for their Fab 30 in Dresden but before it started shipping parts for revenue, AMD would have gone bankrupt in a year. Some OEMs may have defected, but not enough to keep AMD's afloat. AMD had neither the marketshare nor the market credibility nor the manufacturing capacity to be a replacement for Intel. Ergo, they would have gone with Intel. Bye, bye, AMD. Bye, bye, dada's smug assurance that the market sorts everything out.

Even as it was, limited as they were by their fear of anti-trust action (and I interned there; believe me Intel was definitely scared of anti-trust action and made a point of listing all the things they'd like to do but can't because of it), Intel still used their position to hurt AMD. They have been giving sweetheart deals and cooperative marketing dollars to OEMs based not on how many Intel parts were sold, but on how few non-Intel parts were sold. That's literally anti-competitive.

It's great to think that the consumer will simply choose an alternative if some dominant force becomes too abusive. The reality is that they can only choose an alternative if one exists, and they will not shift instantly. If they don't shift fast enough to keep that alternative alive, the alternative goes away and then where are you? That's right: back in monopoly land.

I know you think that all monopolies can only exist if they are government enforced, but reality says that monopolies can exist and be quite stable for a long time, and that the very nature of their power allows them to make their position more stable. I will even hypothetically grant that eventually any monopoly must fail, but "Eventually may recover from years or decades of horrible stagnation" is not a great advertisement for the Laisse Faire system. The fact is that monopolies are both a stable point and broken corner case of free markets, and having reasonable restrictions on the actions of monopolies is a good thing -- because it grants the little upstart who otherwise could be easily and legally crushed a chance to build up and face off against the behemoth. Alternatives don't just spring from the ether and they don't just sustain themselves on their impassioned belief in the free market. Especially not in an industry with barriers to entry as large as microprocessors.

Sorry, but Intel is a perfect example of why anti-trust is a good thing.

Re:Where are those anti-trust advocates now?

[Slack3r78]

Lowering prices below market value? That is _good_ for consumers because NO business can sell for a loss forever -- the minute that they raise their prices after they've wiped the competition clean, new competition will turn up the beat them down again.

I don't have the time to respond to your whole post, but this reeks of someone that whole-heartedly embraces free market economics but skipped the chapters regarding barriers to entry.

What you're describing is predatory pricing, which is generally only good for the consumer in the short run. In the long run, the lack of competition resulting from it generally ends up being bad for the consumer, especially in a market which has excessively high barriers to entry like the processor business.

The processor business is exceedingly difficult to get into these days. First off, you need very smart (and therefore, very expensive) engineers. Then there are IP issues all over the place. As a startup, you most likely wouldn't have the kind of patent portfolio neccessary to interest Intel, et al into any kind of cross-licensing agreements.

Now, assuming you somehow manage to overcome those obstacles you need to actually make the things. A modern chip fabrication facillity costs literally billions of dollars and takes several years to build. Oh, and assuming you somehow manage to get the capital for a fab, you're going to run into yet more IP issues regarding the fabrication process. You see, making chips that are both profitable and competitive these days means you're going to need to use bleeding edge fabrication techniques that are also patent encumbered, which generally aren't covered in any cross-licensing deals over actual processor technology. (See: IBM's strained silicon on insulator technique. There's a reason Intel's not using it.)

If you go down the list of barriers to entry in the Wikipedia article, you'll find the only two that *don't* apply to the processor business are government regulations and "restrictive practices." It's an exceedingly hard business to get into and just a difficult to stay in once you're there. Just look at the charred remains of Cyrix/National Semiconductor and Transmeta if you need examples.

Re:Where are those anti-trust advocates now?

[Azeron]

I think our efforts would be better spent ensuring efficient capital markets rather than trying to lopside the rules for underdogs. Owners of property have a right under our Constitution to sell thier property to another consenting party for whatever price they choose, and that right is an inalienable freedom. Sometimes you just have ot accept that life isn't fair.

Re:Where are those anti-trust advocates now?

[Surt]

Here here, and as another point, there is almost no business with a higher cost of entry than CPU development.

Re:Where are those anti-trust advocates now?

[starseeker]

Lowering prices below market value? That is _good_ for consumers because NO business can sell for a loss forever -- the minute that they raise their prices after they've wiped the competition clean, new competition will turn up the beat them down again.

Actually, there is an optimal point there that basic capitalism doesn't gravitate toward. What happens in a scenario of brutal competition is not only does the price go down, but the quality goes down too - to the bare acceptable minimum that still gets people to buy the product. If you want to stay alive in a brutal market you cut costs, and keep cutting them until you're down to bedrock. Unfortunately this means cheaper ingredients, less severe tolerances, etc. etc. etc. People are not good at identifying pre-purchase (at least at the consumer level) when a product loses quality - in most cases, they won't find out about it until they actually put the product into real use, at which point its not returnable. And since EVERYONE in the industry is doing the same thing, high quality goods will vanish from the market place. There aren't enough discerning customers (statistically speaking) to force a high quality level. PCs are a good case in point - remember those Compaq video cards a few years back? My university's IT department didn't even need to debug the problem - they just brought over a new video card when the signal failed because they knew that's what it was.

the minute that they raise their prices after they've wiped the competition clean, new competition will turn up the beat them down again.

Which is why, once the quality goes down, it is hard to get it up again. Over-engineering is considered a waste of money in an economy where durable goods are considered less desirable (from a business standpoint) than goods that last only a short time - as long as people buy more, you can make more money off of selling the same (cruddy) design over and over than selling a good product once. Of course, this assumes that our resources are infinite, and I suspect someday we will be mining our dumps for raw materials that we are today burning through at an appalling rate.

there are no natural monopolies as long as the customer is given the opportunity to make their decisions.

Actually, there are natural monopolies. Some, like the phone system, were temporary. Others, like Windows, are longer term because they are rooted in the complexity of the training required to use them effectively. Windows users spend a great deal of time learning the complex task of using a computer running Windows, and that investment is so large almost any purchase price is preferable to repeating the training. I'd call that a very natural monopoly.

Capitalism, when functioning properly, is quite efficient. The problem is, it is insufficient to guarantee quality. That's why we have an FDA, for example.

Most of the time, things work reasonably well. However, we could be using our resources FAR more efficiently than we are. Computer cases, for example - why on EARTH should we replace the case when upgrading the hardware? Just make the best form-factor case possible and make the electronics pluggable components. Most of the fans, case plastic, etc are usable for decades when done correctly. My IBM keyboard is probably 20 years old, and it works as well or better than most modern keyboards I have used. That is the standard to aspire to - use resources effectively for the long term. How to do that, I'm not quite sure - but a way needs to be found.

Re:Where are those anti-trust advocates now?

[P3NIS_CLEAVER]

You missed the fact that not only did intel dump their processors on the manufactures really cheap they did it with an agreement that they would not use AMD.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

"lopside the rules"? The problem with anarchocapitalism is that there ARE no rules.

The captial market could be perfectly efficient, but that just greases the flow of money into the giant sucking hole that cash-heavy companies could open at any time.

When the game isn't fair enough, people won't play. What's the point of an efficient capital market when there's no capital to be found?

Re:Where are those anti-trust advocates now?

[Russ Nelson]

That's a great theory. It usually works the other way: a company opens up to compete against the monopolist, the monopolist buys them out, and the principals turn right around and start another competing company. Happened to Rockefeller's Standard Oil many times. One guy sold three refineries in a row to him.

Re:Where are those anti-trust advocates now?

[mangu]

I remember over the years how a bunch of the regular mods used to mod me down as troll when I defended Intel ...

I know *exactly* what you mean... No word for Intel or against AMD goes unpunished in /.

In my experience, AMD is much worse than Intel, because their marketing is so dishonest. They had a marketing campaign for several years based on the meme that "clock speed doesn't matter" and labelled their products in an entirely misleading way. I have a notebook (HP/Compaq NX9005) with an AMD "2200+" CPU, so named to give an impression that it's faster than a Pentium 2.2 GHz. Well, this CPU runs at 1.7 GHz and doesn't have SSE2 instructions, for number crunching it's less than *half* as fast as a Pentium 2.2 GHz. I don't care how fast does integer operations, since anything over 100 MHz or so will be enough for that, but for tasks like encoding videos that CPU really sucks. If AMD had any respect for the consumers they would call it an "Athlon 1100--".

I used to be brand-neutral about CPUs before, but having an AMD "2200+" notebook and an Intel 2.4 GHz at the same time made me a rabid Intel fanboy.

Re:Where are those anti-trust advocates now?

[Grishnakh]

The comparison isn't really between IBM the company and Atari, but more like IBM's division that operated in the personal computer market. IBM is a huge company that has operated in many different markets for a very long time; it doesn't really make sense to think about its other divisions.

Obviously, what the parent was referring to was IBM's PC division, which for a long time (80s) was very monopolistic. Eventually the clones took over, IBM lost its leadership role (look how well those 2.88MB floppy drives and MCA bus in the PS/2 did), and recently got out of PCs and laptops altogether.

IBM has been very successful with some of its other divisions, such as its semiconductor technology division which invented copper-on-silicon and many other important advances. But it pretty much failed at PCs, which is why that division was finally sold off.

Re:Where are those anti-trust advocates now?

[Sebastopol]

Ah, thanks. "the PC division", that makes more sense now in the gp's context, but the general point raised doesn't make sense due to market entry barriers, but that is discussed thoroughly in other posts.

Re:Where are those anti-trust advocates now?

[aricusmaximus]

Owners of property have a right under our Constitution to sell thier property to another consenting party for whatever price they choose

Wrong. Apparently you've never heard of eminent domain. Or of the history and rationale behind anti-trust laws. Both limit property rights in the United States.

and that right is an inalienable freedom.

Wrong again. The universe has no concept of this fiction you call inalienable or natural rights. If you don't believe me, then go provoke a grizzly bear and then attempt to argue with him/her about your rights to life, liberty and the persuit of happiness.

As a consolation, I'm sure Kenneth Lay (posthumously) and British Petroleum would be interested in promoting your point of view.

Re:Where are those anti-trust advocates now?

[JesseMcDonald]

Every business has a barrier to entry, and a new entrant always risks losing the resources they spent overcoming that barrier. If a monopolist is allowed to sell below cost to get rid of a competitor, it creates a chilling effect even if they later raise their prices. A new competitor must consider what happens if the monopolist does it again, and if the barrier to entry is already high (a fab, for example), the competitor will think twice and walk away instead.

You are wrong. Capital expenditures (a chip fab, for example) are not lost when a company fails. They merely pass into disuse for a time, and then change hands to a new upstart competitor. As long as the present methods (or sufficiently similar methods) of chip fabrication remain in demand such investments will retain their value. There are, of course, some costs which depreciate rapidly enough to be effectively lost should the company fail (recruiting, for example), but no sane company would invest resources in such areas until the solvancy of the company was guaranteed. To illustrate:

1. Company A invests $10M in durable chip fabrication capital (buildings, machinery, etc.).
2. Company B begins "dumping" its product to hold off competition, driving down prices.
3. Company A, realizing that the new low prices won't justify their investment, decides to cut its losses and enter a different market. This is where most analyses prematurely end. But what becomes of the capital investments? Are they a total loss? Of course not. They do not cease to exist with the desolution of the company. They still hold significant value.
4. Speculation Company(s) C buy(s) the capital in anticipation of future demand. Company A, or its constituent investors, use(s) the proceeds to enter a different market.
5. Some time passes. Prices approach their original levels. Demand for chip fabrication has increased, just as Companies A and C anticipated. (If their anticipation was incorrect, then they should lose resources as a result. Again, these resources are not destroyed, but rather are simply put to a better use.)
6. At these higher prices, Company D decides to enter the chip fabrication market, purchasing the fab capital from Speculation Company(s) C (with reduced time-to-market as a result of Company A's investment). They are now in almost the same position as Company A was previously, but the market for chip fabrication has improved in the interim, so they have a better chance. Also, Company B's resources have been reduced by their practice of selling below the opportunity cost.
7. Either Company D succeeds in achieving a sustainable market share, or we go back to step 3 and repeat the process until the market conditions are right for competition. Some companies come out a bit ahead, some lose somewhat, but the overall trend is toward a reduction in the barriers to entry (as the fab capital approaches completion).

Like the GP, I do not believe that there are any forms of apolitical "monopolies" that can stave off competition indefinitely. There are some market conditions which make local monopolies more efficient than competition could possibly be (so-called "natural monopolies"), but these are not situations in which intervention could possibly improve matters; they aren't staving off competition, because there isn't any. Such monopolies are an indication of resistance to arbitrary turnover in the market, which is a good thing -- it reduces uncertainty. They are still subject to competition, having been granted no special political protection, but should not and will not be replaced unless they truly fail to meet the needs of the market on a continuing basis.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

People are not good at identifying pre-purchase (at least at the consumer level) when a product loses quality - in most cases, they won't find out about it until they actually put the product into real use, at which point its not returnable. And since EVERYONE in the industry is doing the same thing, high quality goods will vanish from the market place

This is true to a point (for example, the fact that people bitch about crammed seating on airplanes, but will choose an airline with crammed seating if it saves them $10 on the ticket; the airlines have researched this one to death), but the bottom line is that if people really want something, and will vote with their wallets, people will provide it. Think back twenty years; in the USA, McDonald's was the king of fast food, and Budweiser was the king of beers, and Dunkin Donuts was the king of coffee.

Now, more (comparatively speaking) "upscale" offerings have been kicking in. McDonald's has been losing market share, Samuel Adams (among others) has made inroads on beer, and Starbucks and Krispy Kreme have been kicking Dunkin Donuts' ass. Whole Foods Market has been growing at an exponential rate, and Toyota owns GM's ass any day of the week. And while you are mentioning computer cases, compare a 2006 computer case with the crap cases from 1996; the new ones are MUCH MUCH better. If anything, the big trends in the last decade has been "quality" companies and brands.

I'm not saying everything is quality (WalMart and hard drives come to mind), but to categorically describe capitalism as always gravitating towards low quality is an incredible mistake.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

Wow! With such technical information and data, who could argue against that.

Re:Where are those anti-trust advocates now?

[Blackhalo]

Very good post!

AMD is not succeding against Intel so much due to the "invisible hand of the market", as much as Intel has made some colossal mistakes in the recent past.

With Intels faied attempt to leverage thier procesor monopoly into the memory market via there stock swap deal with RAMBUS, to their failed attemt to monopolize the 64 bit arcitecture via Itanium, to the "Slocket" fiasco. Intel has made some very bad decisions that have cost them very large sums of money and ill will with some of their major partners. I think there were some bad decisions related to chipsets as well but I forget the details. Video? NIC's? I forget the specifics.

The question I as myself is, why with the impeding launch of Woodcrest and Conroe is Dell NOW using AMD in there future servers? Would not the past two years of AMD superiority have been the ideal time to make this transition? What do the bigwigs in development at Dell know that we do not about AMD's future processors or Intels ablilty to deliver processors and chipsets in quantity? Intel is nororious in my opinion for "paper" launches of thier products, while when AMD anounces a product launch they have the goods to deliver.

Intel has been too long accustomed to the monopoly position and does not seem to me to have the ability to perform in and actualy competeitve market.

Re:Where are those anti-trust advocates now?

[Fulcrum of Evil]

Why can't you be a fabless company? IBM will build chips for anyone, and this is probably enough to drop your startup costs to several tens of millions, at least until you're established.

Re:Where are those anti-trust advocates now?

[Fengpost]

I agree pretty much with what you said. However, I do not think IBM's PC dividion was a failure. They had solid market share, good products, loyal users and great quality. By anyone's definition it is a good business. But to IBM, the PC division is just a divsion with lousy margin and the people at the division are often at odds with IBM's top management. So, IBM's top brass decided to sell the division to get on with other truely money making business.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

I think "I don't care how fast does integer operations, since anything over 100 MHz or so will be enough for that, but for tasks like encoding videos that CPU really sucks." was a troll giveaway by him.

Re:Where are those anti-trust advocates now?

[darkmeridian]

A new competitor must consider what happens if the monopolist does it again, and if the barrier to entry is already high (a fab, for example), the competitor will think twice and walk away instead.

Sure, if competitors keep showing up, the monopolist cannot withstand the losses forever. However, everybody except the last competitor who dethrones the monopolist loses, and nobody wants to be cannon fodder.

The predatory price behavior in duopolistic markets has been compared to an auction for a monopoly where both sides pay what they bid. Where there are high costs of entry, competition will be non-competitive because all your opponents are known and each party has a large effect on the market as a whole. Each side "bids" how much money it is willing to lose by underpricing their products, and the guy who bids more wins the whole market. The kicker is that the loser pays his own bid as well, even though he got nothing. Given these dynamics, few would be willing to take on an AMD or an Intel, especially since IP issues have allowed entry costs to be raised to obscene levels. Furthermore, Intel is willing to pay a lot to keep its dominant position, and it has a lot to spend to keep its power. Everyone looks at Intel's market cap, thinks about competing for a second, shrugs, and then walks away.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

these resources are not destroyed, but rather are simply put to a better use.

What better use is there for a 3 *billion* dollar chip fabrication plant? I suppose you could rip the expensive equipment out and use the cleanrooms for medical research or something, but at some point you just have to say it's gone, and the highly specialized single-purpous parts you spent hundreds of millions of dollars on go to the recycling bin for pennies a pound. You might get lucky and get B to buy it from you for pennies on the dollar, so that they can make sure there's always enough offline over-supply to ensure that possible competitors think twice about entering the market because they think there is high demand.

Speculation Company(s) C buy(s) the capital in anticipation of what, exactly? Company B not doing it again? Selling it to some sucker that thinks "this time, it will be different?"

All you need to "win" at monopoly is enough money in the bank. If you can cause enough fear in the capital market to prevent competition long enough to refill your coffers, then you can do this indefinitely, or at least until you fuck up internally somewhere, which would be a symptom of stupidity, rather than a free market force.

Re:Where are those anti-trust advocates now?

[petermgreen]

your sequence has a couple of problems, a fab is only valuable for PC CPU production for a relatively short time. Just as PCs devalue very quickly due to the constant advances in the industry so does the equipment used to make them. There is also the reuputation issue, remember the old saying "nobody ever got fired for buying IBM"? if you buy from the dominant market force and it fails your boss will likely put it down to bad luck. if you buy from a new upstart and it fails your job is on the line. Also what really happens to company A's assets is they are sold (possiblly at far less than thier production costs) to a company that can make use of them for some other use.

Patents are also a major barrier to entry in the industry (though you may rightly consider that goverment medling)

look at cyrix, they made a mistake during one generation (poor FPU in an otherwise very fast pentium class CPU just as software really started using floating point intensively) and were permanently relegated to the low end market thier carcus being split between via (who make low speed low power PC compatible chips aimed at embedded and thin client markets) and amd (intels only significant current competitor).

Re:Where are those anti-trust advocates now?

[GlassHeart]

What you're missing is that the Company D would be a riskier investment given what happened to Company A. If it should fail, then Company E will be an even riskier investment. The perceived risk will increase and increase until Company B finally shows signs of real weakness, and successive challengers will have a harder and harder time getting funding. Do you actually have an example of an unregulated monopolist taken down through this successive challenger idea?

I also can't help but chuckle when I saw your $10M fab. Fabs easily cost billions of dollars.

Re:Where are those anti-trust advocates now?

[eclectro]

capital magically comes to you with the Capitalism Fairy or something.

Well I do know that the Capital Fairy at one time liked a cute sock puppet and the word "synergy" a lot. It seemed pretty magical to me.

Re:Where are those anti-trust advocates now?

[Grishnakh]

You're probably right. I shouldn't have used the word "failure" either.

I think what I'm getting at is that, if you look at IBM's PC division in 1985 versus 1995, things looked a lot better for them in 1985: they had a huge chunk of the PC market, and were pretty much the only vendor with MS-DOS, which had become extremely important for running popular applications like Lotus 1-2-3. There were other personal computers, but they were things like the C=64, which was really a home computer and not one suitable for business use like the IBM. With their domination of the business PC market, they had enormous prices, and basically controlled the technology (I don't remember any more exactly when the clones came around and really took power from IBM, but I thought it was the late 80s). IBM's XT and AT defined PC architecture, for better or worse.

Now, in 1995 and later, they were still a player, and probably more important in the notebook space than in desktops later on. But they definitely were nowhere near their former glory. They even tried to retake the whole PC market with their PS/2 in the early 90s, which was a dismal failure. With things like the MCA bus and other proprietary things, which they refused to license to competitors, they seemed to really think everyone would just abandon all the clones and restore their monopoly, but instead competitors like Dell and Gateway2000 took over, as well as countless no-name clones using standardized parts. True, they eventually wised up and built a strong notebook business (Thinkpad) and a decent desktop business, but they were just another player among many, and definitely not the largest (that probably goes to Dell).

Re:Where are those anti-trust advocates now?

[petermgreen]

to the "Slocket" fiasco
what exactly was the fiasco regarding slockets (devices for putting socket 370 processors in slot 1 motherboards) and why did slockets never appear for AMD processors?

slots were an abberation that both AMD and intel jumped on and then soon dropped and afaict AMD and intel both did it for the same reasons, coupling the L2 cache though a CPU socket wasn't really workable at the speeds amd and intel wanted and in package L2 cache drove yeilds though the floor (remember the pentium pro?). Both companies then moved to on die L2 cache making the slot based package redundant.

Re:Where are those anti-trust advocates now?

[ppanon]

Also see: airline company competition in relatively small national or regional markets. High barriers to entry (aircraft fleets) combined with controlled markets (licenced routes and airport access)

CP Air/Canadian Airlines vs. Air Canada. WestJet vs. Air Canada. I'm sure other examples in other countries exist as well.

Re:Where are those anti-trust advocates now?

[maxpublic]

I know you think that all monopolies can only exist if they are government enforced, but reality says that monopolies can exist and be quite stable for a long time, and that the very nature of their power allows them to make their position more stable.

Provide me with a single example from an actual free market. Oh, wait - that's right. *There's never been anything remotely like a free market in the modern world*. Silly me.

But I guess if people keep yapping on about how a government-enforced corporate oligarchy is actually a free market, Orwell-style, then some folks will actually end up believing the bullshit....

Max

Re:Where are those anti-trust advocates now?

[fbg111]

...Intel's future would be as shortlived as IBMs was, as Atari's was, as GM's was... I said Intel would have its down days, just as I say today that someone will beat Microsoft fair and square some day, too.

But how long before it takes before someone finally beats the monopoly? Years and decades in your examples. Humans only live so long, and the whole point of a justice system is to right wrongs in this lifetime and, in legal parlance, to "make whole" or undo the damage done by the perpetrator. Anticompetitive behavior that stunts both innovation and consumer choice and artificially maintains market share or prices for the perpetrator comes with significant costs. How many true innovators and innovations were anti-competitively quashed by MS, for example? Your analysis of the situation is naively rose-tinted.

Like what? Lowering prices below market value? That is _good_ for consumers because NO business can sell for a loss forever -- the minute that they raise their prices after they've wiped the competition clean, new competition will turn up the beat them down again.

Someone already elaborated on the barriers-to-entry problem you're conveniently ignoring.

Again, this is all acceptable if the contract stipulates these situations -- most suppliers are happy to sign agreements if they know what the customers want.

Or when they're being played off against their competitors by a monopoly that supplies the only parts for the market...

I'm glad to see these big companies fall because they're all colluding with the various governments to maintain their power through what I consider negative rights -- copyright, patents and ridiculous mandates requiring their products.

I'm not against big companies so much, but both our political and IP systems are certainly screwed.

Re:Where are those anti-trust advocates now?

[hxnwix]

Define an absolutely free market. Describe exactly what regulations impinge upon economic freedom and are unacceptable. At the same time, share with us, wise one, the laws necessary to permit society to remain functional - remember, any law that in any way reduces economic freedom is not permissable. Outlaw murder for hire, would you? But you would destroy an entire market, enabling the military/industrial murder oligarchy.

OK, that was somewhat extreme. Let's look at the less extreme - something connected with reality, at least. Would you say that the US market circa 1900 was more free than today's? Look again. Standard oil dominated energy.

Re:Where are those anti-trust advocates now?

[dada21]

Standard Oil was not a monopoly. Rockefeller reduced prices for consumers for years and years and years. Before the government even had a chance to take SO apart, competition did. Check the facts.

Better yet, read up here:

The Gates-Rockefeller Myth:
The efficiencies of economies of scale and vertical integration caused the price of refined petroleum to fall from over 30 cents per gallon in 1869 to 10 cents by 1874, and to 5.9 cents in 1897. During the same period Rockefeller reduced his average costs from 3 cents to 0.29 cents per gallon.

This is bad? How? Because competition was too inept and inefficient to give consumers better prices and more product? Come on, bring some facts to the Standard Oil "monopoly" myth.

We also see here:

Privileged Producers:

The U.S. Supreme Court declared in its 1911 decision breaking up the company: "Much has been said in favor of the objects of the Standard Oil Trust, and what it has accomplished. It may be true that it has improved the quality and cheapened the costs of petroleum and its products to the consumer."

Standard Oil was finally broken apart in 1911. Mary Ruwart wrote a huge section of her book about the facts of the SO situation. In 1900, Standard Oil had a 90% share of the oil market based on being the most efficient and active producer. By 1911, Standard Oil had fallen to 65% because competitors found new oil wells in Texas and Oklahoma and were able to match Standard Oil's efficiencies in production and distribution. The anti-trust case hadn't even been settled by this point -- proof to me that the case wasn't needed.

Before the Standard Oil breakup, they were providing cheap oil to poor and sub-poor people who couldn't afford oil before SO was able to produce it so cheaply.

Every time I bring up examples of how monopolies just don't exist naturally (without government subsidies or preferential treatment), people bring up Standard Oil and only SO. They never bring up any other examples because there are none and the SO example is faulty -- they were not a monopoly, they were just efficient for a few decades.

Re:Where are those anti-trust advocates now?

[Doppler00]

Reputation only matters if you are selling a premium product. Cyrix, Transmeta, and Via were never targetting high end processor designs, but were rather filling niche markets they saw needs in.

Re:Where are those anti-trust advocates now?

[simontek2]

You do realize that you can have other companies, such as IBM make the chip for you? Cyrix did that for years. http://www-03.ibm.com/chips/asics/

Re:Where are those anti-trust advocates now?

[HuguesT]

Except in a few corner cases, SSE2 doesn't improve FP performances by 100%. Real-world applications may see an improvement of a few %, if that. Unless you are doing matrix multiplications all day, it won't matter as much. If you do, sorry, you chose the wrong chip.

Most applications, including the kernel, use exclusively integer computations. I think you'd notice if your kernel was running at 100MHz. You woulnd't be happy.

Personnally, I never thought the Athlon was a great chip. Promising but running too hot. The Athlon64, on the other hand, was a different story.

Re:Where are those anti-trust advocates now?

[bismark.a]

>>Owners of property have a right under our Constitution to sell thier property to another consenting party for whatever price they choose
>Wrong. Apparently you've never heard of eminent domain. Or of the history and rationale behind anti-trust laws. Both limit property rights in the United States.

Anti-trust laws are the biggest impediment to the growth of progress, on the basis that they stifle competition, and create unnecessary burden on companies and the judicial system.

If a default monopoly like Microsoft gives away browsers free in competition to a Netscape who charges for it, then it is good for consumers who use Windows, because it them gives more bang for their buck. This argument holds for long term as well, and the proof is the browser (Firefox) that I am using to post this.

There is and was no-one stopping Netscape to giveaway a whole operating system (Linux - Suse?) in competition to MS giving away only a browser for free.

A melt down of market(e.g. where a default monopoly gave something for free and got nothing for return (search engine ads?) ), or a default monopoly market (Windows operating system) are corrected by itself in a market system by more complex market players with advanced offerings (cost per action instead of cost per click???), and more innovative players (Apple Mac OSX). This way a market moves rapidly towards advanced offerings. Which is very good for consumers and for human progress as well.

A man would not compete against a bear with bare hands fully well knowing that he would lose. Then why should humans create unrealistic market conditions by means of highly subjective laws like Anti-trust, to enable a Netscape to poke a Microsoft without developing market potential for what it can compete for?

Re:Where are those anti-trust advocates now?

[Chris Burke]

But I guess if people keep yapping on about how a government-enforced corporate oligarchy is actually a free market, Orwell-style, then some folks will actually end up believing the bullshit....

Speaking of Orwell, I'm just wondering what makes you think Intel's monopoly was government enforced. Or does this just flow naturally from the assumption that monopolies only exist if they are government enforced, and thus since Intel is a monopoly it must be government enforced?

You know, nobody has ever tried the type of anarchy that Libertarian extremists like dada advocate. Well that's not really true; they've been tried, but they almost instantly degenerate into a much less desireable form of kleptocracy.

But continue claiming that the obvious flaws and failings of a free market only exist because the government is there, even if the government had nothing to do with the actual market failing in question. You sound just like the Communists who claim that the real problem is that there's never been a real Communist state. Which, like your statement, is both true and irrelevent.

Re:Where are those anti-trust advocates now?

[Azeron]

"Wrong. Apparently you've never heard of eminent domain. Or of the history and rationale behind anti-trust laws. Both limit property rights in the United States."

Thats's funny, I thought the government had to pay you for your property if they take it from you?

"Wrong again. The universe has no concept of this fiction you call inalienable or natural rights. If you don't believe me, then go provoke a grizzly bear and then attempt to argue with him/her about your rights to life, liberty and the persuit of happiness."

It's an inalienable right because if you steal someone's property, they are likely to get mad and hurt/kill you. we have a constitution and laws to protect those property rights, so we can get gangs (police, military) to make the retribution state sancationed and orderly.

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

If Intel had, say, given the OEMs the ultimatum to stop selling AMD or pay double for Intel parts after AMD had built and bought the equipment for their Fab 30 in Dresden but before it started shipping parts for revenue, AMD would have gone bankrupt in a year.

The OEMs know that if they can eventually buy parts from both Intel and AMD, then the competition between Intel and AMD will drive the price of parts down. Lower costs mean bigger profits for the OEMs, and thus, they have an interest in seeing AMD succeed.

Now, we know that sellers, in general, charge as much as they can get for their products. Therefore, Intel could not double its price for ALL of the OEMs. Why? Because if Intel could, it would already be doing so. It's true that if only one OEM stands up to Intel, then that OEM could fall, but if all of the OEMs stood up to Intel, they would be calling Intel's bluff.

So, I don't really think the events you describe are inevitable. It's entirely possible that AMD would succeed. And, if OEMs did decide to help Intel keep AMD out of the market-place, then it must have been because the OEMs did not think AMD could succeed.

Re:Where are those anti-trust advocates now?

[JesseMcDonald]

What you're missing is that the Company D would be a riskier investment given what happened to Company A. If it should fail, then Company E will be an even riskier investment. The perceived risk will increase and increase until Company B finally shows signs of real weakness, and successive challengers will have a harder and harder time getting funding. Do you actually have an example of an unregulated monopolist taken down through this successive challenger idea?

The increasing risk part is probably true, an indication that the monopoly is more capable of meeting the needs of the market (should it chose to do so) than any of the previous challengers, which would of course make yet another challenger a bad investment.

As for historical examples, I couldn't find any on short notice. Most of the relevant search terms seems to lead to pages discussing either regulation or the board game, neither of which was very helpful, and most of the discussions of monopoly policies deal strictly in abstract theory (on both sides of the issue). Monopolies overturned through natural causes don't seem to warrent much discussion (though that is no excuse for not locating one, I know). On the other hand, do you actually have an example of an unregulated monopolist that was able to profit from charging a "monopoly price" clearly greater than the ideal "competitive price" for the market? (Rothbard didn't believe that such a distinction exists (Link), and I am inclined to agree with him. How can you tell that a company is imposing a monopoly price, rather than simply adjusting to the new demands of the market? Regulation may lower prices (by shifting costs elsewhere), but this says nothing about what the competitive price would be in the absence of both monopolies and regulation.)

I also can't help but chuckle when I saw your $10M fab. Fabs easily cost billions of dollars.

True, the cost of the fab was completely arbitrary. It doesn't affect the analysis, so feel free to substitute a more believable cost.

Re:Where are those anti-trust advocates now?

[smellsofbikes]

Hey now. I work for NatSemi and we're doing pretty well. Of course, part of the reason is because we've dumped all our digital stuff and now do (mostly) pure analog design, where the competition isn't as harsh financially -- but last year we posted the best year we've ever had.

Re:Where are those anti-trust advocates now?

[member57]

Actually GM is the worlds largest corporation, so no, IBM does not have bigger market cap than GM. Just being nit-picky. Look at the companies the GM owns, some are: Rayethon, Hughes, Isuzu, Chevrolet, Buick, Cadillac, GMC, Pontiac, Saab, Delco, AM General, GMAC, and that's just a few I cam up with in a couple of minutes.

Re:Where are those anti-trust advocates now?

[Blakey Rat]

IBM's current status quo seems to be selling really really shitty software (like Lotus Notes) for twice the cost of the Microsoft alternative, then when that shitty software doesn't work correctly, they sell you "consultants" for $175 an hour to fix the broken product they sold you in the first place.

The only part of IBM I still respect is hardware, and half of that is crap. (It's taken years, but their Infoprints are now almost as reliable as HP equivalents.)

Re:Where are those anti-trust advocates now?

[Sebastopol]

think what I'm getting at is that, if you look at IBM's PC division in 1985 versus 1995, things looked a lot better for them in 1985: they had a huge chunk of the PC market

I think we basically agree. Yes, they dominated the x86 market, because they WERE the x86 market, they drove the standards (Ps2 bus anyone?). Gateway, Dell were entering as Wang and Rainbow and Capro and other x86 beige boxes were exiting, so the market fragmented as the home PC boom began.

Now, in 1995 and later, they were still a player, and probably more important in the notebook space than in desktops later on. But they definitely were nowhere near their former glory.

However, if you look at business PCs, and I'm speaking about my company only (90k+ semi co., take a guess which one ;-) uses exclusively IBM PCs since ~94, with a 2 year upgrade cycle. IBM dominated the business PC world in the 90's because they had insanely comprehensive service contracts where they basically did all the software and hardware servicing on site, while Dell and Gateway were shipping boxes to CompUSA for mom & pop. I know for a fact that the retail market is 3~4x smaller than the corporate market, so if IBM dominated there, then by association they would dominate the PC market.

Again, I have no solid data, but it is an interesting comparison. I think once it costs less than $10 billion USD to compete in the semiconductor arena, well see some diverse competition. Maybe that will happen when the next emergent technology displaces the behemoth of modern photolithography....

Re:Where are those anti-trust advocates now?

[Anonymous Coward]

90% = not a monopoly? They used their resources to force competition out of the market. They invested in rail companies and used rebate schemes to deny competitors' products transportation. They reduced prices in regions with small competitors to force them out of business, then raised them when those competitors failed. These are not monopoly tactics in what way? It is not difficult to find wingnut authors who will say anything and dishonestly construe evidence to fit their predetermined conclusion: monopolies don't exist, but if they did, they are good anyway.

Re:Where are those anti-trust advocates now?

[GlassHeart]

do you actually have an example of an unregulated monopolist that was able to profit from charging a "monopoly price" clearly greater than the ideal "competitive price" for the market?

Sure. Check out a phone company in the third world, such as the Philippine Long Distance Telephone company, or PLDT. For decades, PLDT was the only game in town, and getting a line can involve more than ten years of waiting, or even bribery. This is not "monopoly price" in the strict sense of a big number on your bill, but not having a phone for ten years is clearly a "price" of some sense. This changed very quickly when the government finally allowed a competitor called Bayantel to join in, and people got lines very quickly. PLDT initially still tried to sabotage this by limiting the number of trunk lines between it and Bayantel, so that a Bayantel customer calling a PLDT customer would frequently not be able to get through, forcing many businesses to have both a PLDT phone and a Bayantel phone. This is clearly another form of "monopoly price," even in the face of real competition. A truly unregulated monopoly could probably refuse to connect to competing networks at all.

Today, as I understand it, PLDT service is much better than before.

It doesn't affect the analysis, so feel free to substitute a more believable cost.

It affects the number of institutions who are able to finance the effort. For example, if only three banks could give out $3B loans, and your unregulated monopolist is a big customer, they may all value that relationship with Intel more than whatever they can make from you. Add the considerable risk of going up against an unregulated monopolist, and you may not be able to get funding at all.

Re:Where are those anti-trust advocates now?

[Chris Burke]

AMD is not succeding against Intel so much due to the "invisible hand of the market", as much as Intel has made some colossal mistakes in the recent past.

Sure, some of them incredibly huge, like the whole IA-64 fiasco. These are normal parts of being a business and being a monopoly certainly doesn't make Intel immune to them. It does however make them much more resiliant than any other company would be, and any other company would have to abandon some of Intel's more foolish stragies much sooner. Still, it is clearly costing them today as AMD has been able to reap some benefit from Intel's slip up. You may be right that Intel has been too accustomed to their position and has difficulty in a competitive market, but do not count them out.

The question I as myself is, why with the impeding launch of Woodcrest and Conroe is Dell NOW using AMD in there future servers? Would not the past two years of AMD superiority have been the ideal time to make this transition?

I think the basic reason is corporate inertia and stubborness. They made their fortune being Intel-only, and switching sounds like putting that fortune-making strategy in jeopardy. By the time they turn themselves around, it seems as though Intel may be poised to regain the performance lead. I have to say this is typical.

The other reason may have to do with the anti-trust suit AMD is filing. The conspiracy theory version says Dell is using AMD just to make Intel's case look better, but I doubt it since Dell is being subpoenaed and if this fact came out it would be worse for Intel. The non-conspiracy version is just that Intel is actually straightening up their act (they aren't Microsoft, they aren't so arrogant as to think they can do whatever they want while the trial is going on), and thus Dell isn't getting such sweet deals anymore.

The third reason may be that this is all a way to show Intel that Dell is really serious about their long-standing threat to use AMD. If Intel is successfull defending against the lawsuit, and sufficiently greases Dell's palms, then we may see Dell kill off their AMD lines with a press release along the lines of customer demand being insufficent.

Re:Where are those anti-trust advocates now?

[Chris Burke]

Now, we know that sellers, in general, charge as much as they can get for their products. Therefore, Intel could not double its price for ALL of the OEMs. Why? Because if Intel could, it would already be doing so. It's true that if only one OEM stands up to Intel, then that OEM could fall, but if all of the OEMs stood up to Intel, they would be calling Intel's bluff.

Right, the doubling of price could not be more than a threat to keep them from using AMD. But it would still be brutally effective due to one very important fact:

AMD cannot supply the entire processor market, or even most of it. This was even more true back before Fab 30 came online. At that time they could not have attained more than 20% marketshare even if the demand was there. Thus a mass defection away from Intel was physically impossible.

So no matter what, the majority of OEMs will be getting the majority of their product from Intel, so paying double the price would be crippling. If even one large OEM played Intel's game then they would easily crush the ones who didn't, so the others would have to play game too. Dell has been playing Intel's game all along, so if Intel tried this gambit, the other OEMs would have the choice of either playing Intel's game or handing the majority of their own marketshare to Dell.

What do you think they would have done?

Re:Where are those anti-trust advocates now?

[aricusmaximus]

Thats's funny, I thought the government had to pay you for your property if they take it from you?

You're missing the point. Read the parent post again.

"Owners of property have a right under our Constitution to sell thier property to another consenting party for whatever price they choose".

This is factually incorrect.

1) Eminent domain prevents the owner from selling at whatever price they choose to the government
2) Anti-Trust law prevents the owner from selling to any consenting party

This is not even getting into zoning laws and other laws regarding sales (guns, tarrifs, etc).

Re:Where are those anti-trust advocates now?

[aricusmaximus]

Anti-trust laws are the biggest impediment to the growth of progress

I disagree. In fact, anti-trust laws are necessary to maintain a democracy. Are you against democracy, sir?

on the basis that they stifle competition

A monopoly by definition has no competition. Anti-trust laws prevent monopolies. Furthermore monopolies often use unfair and anti-competitive practices to squash competition that have absolutely no benefit to the consumer. For example, Standard Oil used train agreements and other unfair business practices against competitors. Microsoft specifically putin instructions to prevent DR-DOS from being used with Windows 3.1. Both practices relied on the dominance of Standard Oil and Microsoft in their respective markets.

and create unnecessary burden on companies and the judicial system.

I disagree that it unncessary. Anti-trust laws, by regulating unfair business practices a necessary burden on the few companies large enough to become a monopoly. I would guess that the proportion of anti-trust cases and thus their "burden" to all legal cases in the U.S. to be minimal (probably less than 1%).

There is and was no-one stopping Netscape to giveaway a whole operating system (Linux - Suse?) in competition to MS giving away only a browser for free.

A horrible argument. If I'm competing with you in creating a product in market A, why should your standing in market B influence this? This is anti-competitive. To make an analogy, suppose we are to run a race (100 meter dash), but the condition is that I have to do a series of sommersaults and cartwheels before I can leave the starting line. The relative merit of our products (our ability to complete the 100 meter dash) is obscured by the fact you have an unfair advantage. My product may be superior and of better benefit to the customers, but you still "win".

a default monopoly market (Windows operating system) are corrected by ...more innovative players (Apple Mac OSX)

Your example of MacOSX is also not a valid example. Apple's OS market share is still less than 4% worldwide, despite its innovations. In addition Microsoft has (1) given funding to Apple and (2) continued to make Microsoft Office products for Apple. Why? It's not from the goodness of Bill Gate's heart. Microsoft provided funding and continued Office support for Apple precisely to prevent further anti-trust litigation. If there were no anti-trust laws, there would have been no further funding, nor further work on the Microsoft Office line for the Macintosh, and the Mac line would have gone the way of the Commodore Amiga.

Then why should humans create unrealistic market conditions by means of highly subjective laws like Anti-trust

Anti-trust laws exist in actual law and are part of the market conditions here in the United States. You can't get much more "realistic" than fact. Perhaps you live in another dimension?

As to the claim of subjectivity, my knowledge of anti-trust law is not sufficient to give a definitive argument on how subjective it is. But more to the point, you provide no evidence or argument as to why objectivity would automatically be superior.

Fundamentally, the problem with monopolies is the abuse of "bundling". For example, suppose you have a system of toll roads. Company A, through acquesitions, acquires a monopoly (or even a substantial, say 60%) of the toll roads. Company A keeps the prices competitive with other companies in regards to toll pricing. So far so good.

Now suppose Company A is competing with Company B in supplying and manufacturing cars. Company A adds as a "feature" that every car created by Company A automatically gets a 25% discount on the tolls. This creates a competitive advantage for Company A, and stifles the potential advantage for C

Re:Where are those anti-trust advocates now?

[bismark.a]

A market economy where the government's only function is to protect the individual rights of its citizen and nothing else is the best form of governance. This is the only way to bring about the greatest innovations, in the shortest time. This brings about fastest progress and hence benefits all the members of such a society the most.

A democracy neither ensures that citizen are given only individual rights, nor that they are ensured. Also democracies allow inferior candidates to become presidents. And even worse, allows them to make spurious laws, and even more spurious laws setting back Amreican and human progress by many years.

A monopoly by definition has no competition. Anti-trust laws prevent monopolies. Furthermore monopolies often use unfair and anti-competitive practices to squash competition that have absolutely no benefit to the consumer. For example, Standard Oil used train agreements and other unfair business practices against competitors. Microsoft specifically putin instructions to prevent DR-DOS from being used with Windows 3.1. Both practices relied on the dominance of Standard Oil and Microsoft in their respective markets.

Wrong. In a market economy there can never be a monopoly "by definition". There can only be very very good competitors who have deservedly got a very high proportion of market. Do you think if Microsoft prices its Windows software at 2000$, that any customer would still not get Ubuntu on their machines? If they can do that then it is not a monopoly. If I were to sell you something, should I be dictated that I not be trying things to sell you more value for the same price? If so then such situations enforce anti-competitiveness for me and force me to become less competitive. And this is generally bad for the market economy and human progress and growth. May be a boon for my competitors though, as they don't have to play harder.

A horrible argument. If I'm competing with you in creating a product in market A, why should your standing in market B influence this? This is anti-competitive. To make an analogy, suppose we are to run a race (100 meter dash), but the condition is that I have to do a series of sommersaults and cartwheels before I can leave the starting line. The relative merit of our products (our ability to complete the 100 meter dash) is obscured by the fact you have an unfair advantage. My product may be superior and of better benefit to the customers, but you still "win".

The argument is may be horrible to Netscape but it is the reality, and beneficial to everyone. Markets are not islands or in a perfect vacuum, they exist along with all the products and interlinked. Let me give another analogy to yours about the race. Should olympic sprinters be crippled in order to race against handicapped people, so that the race is not "anti-competitve"?? Or should we rather give the sprinters (even if there is only one) to run full steam ahead towards the ribbon, and let other people who are cannot compete in sprinting with Olympic sprinters, to do whatever they can do best.

About why subjectivity of any law, let alone anti-competitive law, is a house of horrors, read the history on any dictatorship nation.

Re:Where are those anti-trust advocates now?

[Azeron]

"2) Anti-Trust law prevents the owner from selling to any consenting party"

Anti trust laws that prevent owners from selling thier property to other parties are clearly unConstitutional.

"1) Eminent domain prevents the owner from selling at whatever price they choose to the government"

Thats clearly erronious thinking in several ways.
1) the government can't make you sell it for less than its worth, so in theory you could buy similar property, and you haven't been harmed. You can still sell your property at lower price if you want though.
2) forced disposession is a far different cry from forced possesion. Image being forced to sell your house so the government could build a road, as oppossed to not being able to sell it so your neighbors could sell theirs at higher prices -- which is exactly what is going on here.
3) the government can only use the power of eminent in limited cases when negotiations on an equitable price have failed, AND the property in question is for public use, which almost always mean land.
4) Just because the government can force you to sell does not mean that the Constitution does not protect property rights. Its like saying "because nailing Jesus on the cross granted us salvation, that means we should nail every jew we see to a stump of wood will be good for our souls" is clearly rediculous
5) tarrifs, taxes and regulations regarding the sale of property does not stop you from selling at a price of your choosing. they are a restriction on the right of buying!

Re:Where are those anti-trust advocates now?

[aricusmaximus]

A market economy where the government's only function is to protect the individual rights of its citizen and nothing else is the best form of governance. This is the only way to bring about the greatest innovations, in the shortest time. This brings about fastest progress and hence benefits all the members of such a society the most.

In other words, Anarcho-Capitalism. If it's such a great idea, why not just shout it out in the first place? Possibly because anarcho-capitalism has already been refuted?

A democracy neither ensures that citizen are given only individual rights, nor that they are ensured. Also democracies allow inferior candidates to become presidents. And even worse, allows them to make spurious laws, and even more spurious laws setting back Amreican and human progress by many years.

Ironically, I'm 99.9% certain that you wrote this statement from a democratically governed state, and 95% sure that it's the United States. In the links you cherry-picked, you apparently you choose to willfully ignore the Constitutional amendments (Bill of Rights, 13th, 14th and 15th Amendments, and the 19th Amendments) that expanded the rights of United States residents (not just citizens) to levels unprecidented in human history. Without child labor laws, you may not have had the opportunity to pick up the education and time to write your arguments. Without the laws enacted after the great depression

You are absolutely right that democracy does sometime depress individual rights and choices, nor does it alway ensure indvidiual rights, and it allows people to make bad laws -- because it all involved human people making decisions, and humans will make mistakes. Yet Anarcho capitalism gives people even *more* freedom to make mistakes, and relies even more heavily on individual choices on governance. Your implicitly assume that under Anarcho-Capitalism everyone will magically make the correct decisions, yet you undercut that very argument by showing how dumb people can be.

Wrong. In a market economy there can never be a monopoly "by definition". There can only be very very good competitors who have deservedly got a very high proportion of market

Okay, time for a mirror argument: "Wrong. In an unfettered market economy, monopolies inevitably occur. Furthermore, since being mean, unethical, and a cheater makes a market entity more efficient, there can only be mean, unethical competitors who have lied, cheated and stolen to undiservedly get and maintain a very high proportion of the market."

Do you think if Microsoft prices its Windows software at 2000$, that any customer would still not get Ubuntu on their machines?

Uh, yes. Have you been to your local Fry's/Best Buy/Circuit City lately? Microsoft office currently retails for ~$350.00, and Windows XP Professional costs ~$200.00. That's no $2000, but $500.00 is significantly more than what Ubuntu's retail price is (free). I have yet to see a mass migration to Ubuntu, so I fail to see where you are making a significant argument.

Furthermore, I reject your implicit assumption that all markets behave like the software market (low initial resources and capital required). There are numerous markets (water, electricity) that lend themselves to natural monopolies. ...Or should we rather give the sprinters (even if there is only one) to run full steam ahead towards the ribbon, and let other people who are cannot compete in sprinting with Olympic sprinters, to do whatever they can do best.

Absolutely. Which is why we don't have a rule to allow the person who wins the shot-put event to get a head-start in the 100-meter dash. Through bundling and other market advantages monopolies gain a similar unfair advantage that ultimately stymies comp

MSFT next

[Anonymous Coward]

Good move. MSFT should be next.

Unlike other companies...

[Alizarin Erythrosin]

Unlike the company I work for that creates an entire new layer of management, then does layoffs for all its technical (read: non-management) workers.

Re:Unlike other companies...

[ackthpt]

Unlike the company I work for that creates an entire new layer of management, then does layoffs for all its technical (read: non-management) workers.

Top-heavy companies do topple. Usually just a matter of time. If their business is profitable enough to sustain significant inefficiencies, a competitor will eventually arrive who runs a tighter ship. I'm watching something like this happen right now - several vendors have had it good for years and haven't provided the best service or the most timely fixes and improvements, now some little shop picking up very sharp developers and using open source tools is about to eat their lunch.

Re:Unlike other companies...

[Anonymous Coward]

Care to elaborate? I LOVE shorting big, fat, lazy companies. It makes me feel good in many places.

Re:Unlike other companies...

[Anonymous Coward]

The place I work almost did. Thank goodness to US tax dollars to help us out of the hole.

My group has 5 programmers. We have 2 directors and 4 managers above us to manage our work. We just implemented a large, complicated project administration system so that the managers can more easily manage our work.

I work for a really large company that has a whole lot of market share. If we screw up again, we will be pulled out again.

It is insane.

Re:Unlike other companies...

[jd]

You work for NASA?

Re:Unlike other companies...

[timeOday]

Unlike the company I work for that creates an entire new layer of management, then does layoffs for all its technical (read: non-management) workers.

Does this involve a change of personnel, or do all the techies just get promotions?

Re:Unlike other companies...

[malraid]

Are they hiring new managers? I'm looking for a new gig, and that looks like THE place.

Wow

[HaeMaker]

Sounds like an org chart foldin.

Take your org chart.
Turn it sideways.
Fold it so that a level of management is missing.

Viola! Org chart foldin!

Re:Wow

[Amouth]

when you said "turn it sideways" i was thinking.. then buble up the CEO and delete all opheans until you have a clean heap

Re:Wow

[kfg]

I call this MMR, the Mad Magazine Reorg.

And yes, it's funny to look at, but you wouldn't want to live there.

KFG

Oh, that's smart.....

[tinkerghost]

He said he planned to make changes as his analysis progressed, rather than waiting until the end of his review.

Because it's always better to start doing something before you finish understanding everything, than waiting till the end when you can make changes based on an accurate understanding of the entire process.

Re:Oh, that's smart.....

[King_TJ]

No ... that could very well also be a "politically correct" way of saying, "I'm well aware that some of our management are worthless sponges, sucking up a paycheck while adding zero value to the company. I plan on kicking these people out as soon as I can, while looking at the rest of the bunch to see who else needs to stay, and who needs to go."

Re:Oh, that's smart.....

[ThinkWeak]

It all makes so much sense..... obviously when your the Chief Executive you know what's going on in every layer of your business... why else would you be "on the top"? The best part is, the stock price rose $0.11 after the announcement. So what if he completely removes the wrong area - saving $1 billion is the important part right? I would most definitely invest in a company that is led by someone who has no problem throwing it into the mud....[/sarcasm]

Re:Oh, that's smart.....

[pla]

that could very well also be a "politically correct" way of saying,[...]

Or it could mean that in six months, we'll hear about how Intel accidentally stalled their production pipeline for the next five years by laying off a few of their "underperforming" R&D groups.

"But they had zero income and a huge budget, and I didn't understand their explanation what with all those big words like terahertz and sixteen core and quarter-watt TDP! It looked like a no-brainer to sack the lot of 'em!"

Re:Oh, that's smart.....

[Odin_Tiger]

So...you're on a boat. It's slowly sinking. You begin to analyze the situation, and you discover what appears to be a large hole below the water line, which is taking on water at a pretty high rate. Do you:
A) Plug the hole as fast as you can, or
B) Make note of it, and any other holes you may find, but simply continue your analysis until you are sure you know everything there is (or was, before it sank) to know about the ship?

Management Still Important

[ObsessiveMathsFreak]

Despite the expierience of not a few Slashdotters, managers are still quite important in any organisation. Their job is to manage things so that you can get your job done. They're there to make sure the lights stay on, that there's water in the coolers, donuts in the kitchen, that you get a new computer, that you can order software, that you get feedback on your code, that you don't have to go looking for customers, and so that you don't have to deal with every trifling detail that goes with running an organisation and basically can just get down to work.

Unfortunately, some managers get it into their heads that not only should they make the company run smoothly, but that they should also run it outright. When this happens, it's best for the CEO's/directors to prune things pretty quick.

Re:Management Still Important

[Anonymous Coward]

...donuts in the kitchen...

MBA 8012 : Acquiring and maintaining donuts for workers.

That's what I took at school. It was really hard! First, we had to make a spreadsheet of all of the donut brands out there: Krispy Kreme, Dunk'n, Enteman's, etc....

Then, we had to do a cost benefit analysis : comparing the cost of the donuts with the amount of worker productivity.

And then, do a regression analysis comparing increased health care costs (because of the increased donut intake) with increased worker productivity - had to find the sweet spot!

It goes on from there....and I gained a hundred pounds!

Re:Management Still Important

[fred fleenblat]

I do not find your examples of critical management expertise compelling.

Re:Management Still Important

[vertinox]

Despite the expierience of not a few Slashdotters, managers are still quite important in any organisation.

I've always said, managers are bad per se, but when they don't understand the technology or the work their employees do or even understand what the company does to make money, then you've got a problem.

In most places that I have seen be successful, they have taken engineers or technicians who weren't the world's best technician or engineer, but knew a bit about management or had "managment-esque skills" and then upgraded him to that position rather than hiring someone from outside the company. Since the new manager knows what the people beneath him do and understand the concepts and technology they work with, he can effectively make decisions.

Hiring management people just because they are managers is a bad idea when working with complex or difficult technologies. Either the manager is going to make bad decisions because he is oblivious to his ignorance or he just lets people do whatever they want because he doesn't know what to do.

Re:Management Still Important

[Anonymous Coward]

Their job is to manage things so that you can get your job done. They're there to make sure the lights stay on, that there's water in the coolers, donuts in the kitchen, that you get a new computer, that you can order software, that you get feedback on your code, that you don't have to go looking for customers, and so that you don't have to deal with every trifling detail that goes with running an organisation and basically can just get down to work.

The article didn't say 1000 secretaries and janitors were being pink slipped, it said Intel managers.

Oh wait...

Re:Management Still Important

[asuffield]

I can make that even shorter:

A good manager removes problems without people noticing. A bad manager creates problems in order to be noticed.

Problems to be removed particularly include anything that could waste the time of people who are supposed to be doing real work. Problems that are often created are ways of wasting those people's time - like compensating for the manager's lack of understanding by explaining things to them, instead of doing something productive.

If you can't understand what you're employees are doing without them explaining it, you probably aren't qualified to manage them. This problem seems extremely common in the technology sector. Presumably people think that because managers are interchangeable in the low-skill sectors (retail, customer service, etc) where anybody can understand what the workers are doing, the high-skill sectors should work the same way - but they don't.

That's not to say that managers need to be smarter than their workers - they don't need to be able to *do* those jobs. They just need to be nearly-as-smart as their workers in order to understand without needing to be educated all the time.

Re:Management Still Important

[TakeyMcTaker]

Where I work, things are obviously much different. We apparantly don't need any "manager" but the Owner/CEO, who is also one of our top Engineers, and the Production Manager, who is more like a Milestone minder with QA lead tasks. The PM doesn't write the Milestones -- the real practitioners do that for each department collectively. He just reminds people of their tasks, and works with QA to make sure they're done right, often acting as a QA tester himself.

They're there to make sure the lights stay on.

Our landlord covers electric and lighting as part of the lease. Besides, I like to work while only in the soft glow of my monitor. ;) At best, the company accountant can take most of the credit for this.

that there's water in the coolers

No, the delivery truck guy does that -- and the accountant that pays his water company. And the last person to empty a bottle is responsible for putting the next one on. We don't need a specific position for that. If someone is too weak, they ask for help with the bottle, but that's pretty rare. If people can't figure out how to throw a new water bottle on the cooler, maybe you should buy my instructional video, for a small consultation fee...

donuts in the kitchen

No water bottle excercises, and now donuts? Your employees must be rolling blobs by now, with casters for legs. Significant Others, or Chef-hobbiests, at the office sometimes bring cookies and other treats to the kitchen, but a position for a full time donut supplier??? That bloat needs to be chopped right away!

that you get a new computer

All our employees get a working box, ready before they sit down the first time. New computers are brought by IT before they need them. Why would management be involved with that? Good IT practitioners can predict when someone needs new hardware based on upcoming projects and related software requirements, and a good Production Manager keeps IT informed. IT "Managers" often can't predict this, so who needs 'em? "Managers" just tend to muck it up with some ridiculous procurement policy, which usually involves a vendor who's giving them kickbacks on the sly. A proper procurement policy involves a knowledgeable IT worker with a known budget, who mods PCs on the cheap as a hobby, with a mix of Froogle, NexTag, and CNet.

that you can order software

Employee: "I need software." IT: "Are you sure?" E: "Yes" IT-to-Project Manager: "Does E really need this? Is it worth X$ in productivity or project time?" Project Manager: "Yes." IT buys software. It is downloaded and installed immediately, or delivered and disk-swapped within a week iff luddite disk-dist-ware.

that you get feedback on your code

Programmer #1: "How does this look? I trust your judgement." Programmer #2, on related project: "...Sucks. Fix this and that." #1: "OK, I'll refactor." #1: "...Done." #2: "Good 'nuff." QA: "Found problem." #1: "Fixing..."

that you don't have to go looking for customers

Where I come from, that's called Sales, PR, or Marketing. All the useful work there is footwork and communication to the outside, not managerial communication inside. If any marketer is out of whack with what the production staff knows they're making, they are soon corrected. No manager needed for that -- just a few outspoken production workers, who care about product perceptions.

and so that you don't have to deal with every trifling detail that goes with running an organisation and basically can just get down to work

You see, in a healthy company, where the majority is doing their own job, and all the tasks are well defined, this happens fairly naturally. When nearly everyone is not just some manager, who is always trying to seem sufficiently more busy than an actual production worker, enough to justify their bloated salary, and

Re:Management Still Important

[tehcyder]

because managers are interchangeable in the low-skill sectors

No, in most ways it is harder being a manager in a non-tech/professional environment, because the staff are not motivated by or particularly interested in the work to start with.

Re:Management Still Important

[Anonymous Coward]

"If you can't understand what you're employees are doing without them explaining it, you probably aren't qualified to manage them. This problem seems extremely common in the technology sector."

crap. intelligent people should understand the basic strucure how work is done, if you could not explain what you do for your manager .... well, then you dont understand it yourself.

Headline should read...

[gasmonso]

AMD Lays Off 1000 Intel Employees

Just kidding, but I feel sorry for those people :( But having 1000 less managers will probably allow their employees to actually get some work done :)

http://religiousfreaks.com/

Re:Headline should read...

[Anonymous Coward]

Please put the link to your stupid site in your .sig so we don't have to read it fifty times a day.

Re:Headline should read...

[drinkypoo]

Please put the link to your stupid site in your .sig so we don't have to read it fifty times a day.

Please build a bridge and get over it. If you really don't want to see it, a tiny little bit of greasemonkey work will eliminate all links to that site.

I've considered doing the same thing with my sig just so I can also have a link in there. (not enough characters at the moment.) There should really be two limits on sigs, chars, and displayed chars. Well, IMO.

Re:Headline should read...

[mrchaotica]

TinyURL.

Re:Headline should read...

[Anonymous Coward]

Do you post nonsensical garbage every day just to plug your idotic website?

Just curious. Call me crazy, but it's awfully transparant.

Re:Headline should read...

[Anonymous Coward]

But having 1000 less managers will probably allow their employees to actually get some work done :)

Depends on whether those 1000 managers are actually needed or not. I wouldn't be exactly thrilled of the idea that I had to do my boss's job.

Re:Headline should read...

[drinkypoo]

TinyURL helps but it doesn't change the fact that the overhead just for creating a valid link is a significant percentage of your total character allowance.

Re:Headline should read...

[Anonymous Coward]

But having 1000 less managers will probably allow their employees to actually get some work done :)

They should lay off 1024, that way its 1 megamanager with no parity.

Re:Headline should read...

[Anonymous Coward]

Exactly. As I understand it, a lot of the managers who were let go had very few people reporting to them. That leads me to believe -- and in some instances I know -- that managing is hardly the only thing they've been doing. Will anyone be there to absorb the rest of the work? Who knows? What's another few night and weekend work hours among friends?

Overdue, maybe?

[JayDot]

How do you have thousands of managers and not have someone who needs to be laid off (for real reasons)? And to have 1000 that can be shown the door just seems to indicate that such an action is loooooong overdue.

Re:Overdue, maybe?

[susano_otter]

Since Intel has over 100,000 employees, this is only a 10% reduction. And why should it be overdue? Intel has being doing well up until recently. Recent events have changed that, which is why they're due for a reduction right now.

Sounds like a good move to me....

[King_TJ]

It's refreshing to see a bunch of middle management given the boot, rather than the much more common scenario of cutting jobs of the technical people "in the trenches".

I've always felt that especially in fields like engineering and computer support or application development, you can get by with very minimal management if you make it a point to try to hire people who are comfortable/capable working with little direction.

Most people I've known who were good in the area of computing and I.T. (not to mention engineering types) spent a lot of time teaching themselves and experimenting via trial and error. (If you got interested in computers back in the 1980's, there really were no classes to take or certification exams to pass. You *had* to pick up whatever book(s) were bundled with your computer, learn how to program it yourself, and master the thing.) These aren't people especially "compatible" with multiple layers of management and micro-management.

Re:Sounds like a good move to me....

[Amouth]

this is how the company i work for is.. we are small under 50 but to be honest everyone reports to everyone.. we have a group that makes the really big decisions - but everyone handels them and gets their input..

i could never work in a place that ever thought of having 1000 managers .. that could be cut with out distroying the work force..

Re:Sounds like a good move to me....

[Y0tsuya]

Don't worry. Technical people will follow soon by the ratio of 10:1.

Re:Sounds like a good move to me....

[NineNine]

You're right. Now that a bunch of middle management has gotten the boot, it'll be up to engineers to now: maintain their own buildings, do their own payroll, manage their own benefits, create their own marketing, develop their own packaging, do their own manufacturing, sell their own products....

You're either incredibly naive, or you've never held a real job if you think that a company like Intel canget by with "Very minimal management".

But, as other posters have pointed out, Intel isn't stupid. You can't just fire 1000 managers, and expect the technical people to "do their own thing". Expect a few thousand engineers to be canned soon (or gradually so that they don't have to report it to the public, like IBM has been doing for the past few years).

Re:Sounds like a good move to me....

[AaronHorrocks]

Darned right.

Most of the highly techie folk just need to be left alone to do their work. I know since I'm one of 'em. Multiple layers of management (that always make way more money then the guys doing the actual work) really just aren't needed.

Re:Sounds like a good move to me....

[cyclone96]

I've always felt that especially in fields like engineering and computer support or application development, you can get by with very minimal management if you make it a point to try to hire people who are comfortable/capable working with little direction.

I tend to agree with you, but I've definitely seen it fail. I work in government (NASA), and with a pretty crappy budget situation in the 90's, the ratio of engineers/management in an org I used to work for slowly creeped up. The engineers were producing stuff and knew their jobs, so losing them in the short term hurt, but it was easy to consolidate their management.

That is, until a year or two went by. Lower management had so many employees they'd barely know what they were doing. Those engineers were very smart people and kept busy doing brilliant work, but often it was on things that, in the big picture, wasn't something we should have been expending labor on.

Other departments sapped our labor, by asking individuals (instead of their management) if they could "give us some help with this". A few hours here, a few days there, pretty soon we can't map our budget to what we are actually producing but yet everyone seems overworked because of the "extras" that should have been tasked through a request of their management.

Worse yet, it caused a lot of things that need to get done for long term health of an organization to fall by the wayside, like training, career development, and succession planning. Bob the engineer may prefer to work on his new gadget, and could care less that if he were hit by a bus the following morning there's nobody around to support that critical piece of software. He never trained a backup.

Or the hot new engineer that is a workaholic. Sometimes people actually need to be told to go home/take a vacation, lest they burn themselves out in a couple of years (often causing them to quit or transforming them into a bitter employee).

Anyways, it's pretty easy to find management needless because of the bad ones, but good management will always leverage their employees into producing more and being happy while they do it.

Re:Sounds like a good move to me....

[sgt_doom]

Amen, brother.....

Re:Sounds like a good move to me....

[Anonymous Coward]

I agree that managers are important for many things and I also agree with others that managers are largely irrelevant. The truth is that in technology most middle, even upper managers are dolts and usually a mouthpiece for the business side of development. They do not effectively do their jobs, they do not try to encourage the creation of a quality product...they are overly concerned with irritating meetings, status updates, processes, etc. Now you may not believe me but this comes from my experience at a very large investment bank which has large IT expenditures, we are among the top 5 of IBM's customers. I have been working without a manager for a year now and really besides boring meetings, it is not different. The other thing as a large population of middle management fears those who work below them, infact one developer who was very skilled and experienced often told the business side things that made his manager look dumb and as a result the manager basically made it a hostile working environment for the guy, who preceded to leave because of it. Management is a good way to lose the top talent.

IANAIM

[Anonymous Coward]

I Am Not An Intel Manager. But I do work there. I can say that there are way too many managers and that this action is required :-)

I can not count the number of managers that have two or three people reporting to them. There are^H^H^Hwere managers who have never worked in the field they manage. I say that before becoming a manager you should have years of experience doing the things that the people you manage do.

Paul Ottelini rocks!

Re:IANAIM

[Anonymous Coward]

IMHO, this action can be translated into the following: "Intel tries to fire their bull$#1t artists."

I hope it works.

Re:IANAIM

[Anonymous Coward]

I am not an Intel manger either, but I am an Intel employee, and was a first level manager until quite recently.

I had less than half a dozen people working for me throughout my entire multi-year tenure as an Intel manager, which was fine by me: I could give them all the attention they needed and it didn't consume more than 30% of my time, so I could STILL do my full-time individual contributor job, which is what's expected of first level managers at Intel.

I was, as most first level managers are, a working manager. What concerns me most about this move is the assertion that we're losing about 1000 managers. We're probably only going to lose about 700 FTE's of management work, and we'll then lose about 500 FTE's worth of senior technical people with a ton of tribal knowledge, extensive social networks within the company, and years of delivering proven results. Yes, the numbers don't add up to 1000--managers at Intel tend to wear a ton of hats, put in a ton of unpaid overtime, and go the extra mile. Some don't, but I have firsthand knowledge that those folks aren't the only ones losing their jobs this month.

Re:IANAIM

[kfg]

I say that before becoming a manager you should have years of experience doing the things that the people you manage do.

Once upon a time it was not an uncommon practice for kings to "trade" sons and have them educated in each other's palaces, where they could not be expected to be treated as part of the royal family, before they were deemed fit to be kings in their own right (of course they also had that "friendly hostage" thing going on there).

Some time later it was not an uncommon practice for business owners to "trade" sons and educate them in each other's businesses, usually starting in the mail room or loading dock or some such, before they were deemed fit for the executive level in the family business.

Now it is not uncommon to hire a 24 year old right out of college who has never even had a paper route to tell people who have worked in the business for 24 years what to do, when they are barely adequate at making sure the lights stay on and the donuts get delivered.

There might have been some wisdom in the old ways.

KFG

Re:IANAIM

[chipset]

I was at AT&T Bell Labs in 1995 when AT&T decided it was going to lay off 45,000 managers. Yes, that number is correct. 45,000 managers. As I was a consultant, I talked to one manager and asked how many people he had working for him. He responded that no one worked for him. He was a manager, and stood by that title.

So, while 1000 sounds like a lot of managers, I have to wonder how many are managers in title only.. Sounds like more than a couple.

Re:IANAIM

[MonsoonDawn]

What's key here is not so much the number of people fired but how each decision was made. In my experience mass layoffs hide a lot of revenge.

Re:IANAIM

[Anonymous Coward]

Sometimes, not even "hide". Where I'm working, a vindictive investment group (with the authority to do so in the contract for our funding) decided to subject our company to a series of four layoffs, effectively cutting our company in half. The first layoff trimmed some fat. The second layoff drew blood. The third layoff cut to the bone, and disrupted everything so badly that we nearly had to completely change focus as a company. They also dropped some financial woes on us, delaying a round of payroll. Another employee left on his own to take another job shortly after that.

Our leadership told us that those investors had the particular power to dicate business decisions (or threaten worse, which could have been taking apart the company and selling off our tech, piecemeal).

We're back on track now, but the engineers still walk softly and talk angrily about this over lunch.

Re:IANAIM

[asuffield]

I can say that there are way too many managers

Two managers is too many managers.

No, really. Any given area should have precisely one manager assigned to it, who can say 'go' or 'no go' quickly and without a lot of fuss. They may need assistants; they do not need other managers 'helping' the decision (or, ugh, a committee). Huge numbers of corporate structuring blunders (in practice) result from assigning multiple managers to a single task, often out of fear that some of them are incompetant. Most corporations could get by much better with a tiny fraction of their management personnel.

Re:IANAIM

[smellsofbikes]

Back in the day, every new-hire at Hewlett Packard, and I mean up to the executive level, spent the first month doing assembly, winding inductors, working on the sheet-metal-forming lines, and generally at least getting some experience in all the job levels below that for which the person was hired. It's a similar concept tp your internship-of-royalty thing.

But what about the new Conroe chip?

[dtjohnson]

So, sales are weak and costs need to be cut. This Friday, though, Intel is going to announce their new 'Conroe' desktop chip when the NDAs expire. We've already seen from the hype and benchmarks of the pre-shipping chips that Conroe is going to be a very good chip that will put Intel back in the driver's seat so why do the 1,000 have to go only two days before Conroe appears? Couldn't Intel just hang on for a few more weeks until the Conroe sales take off? Maybe then they wouldn't even need to dump the 1,000 managers.

Pink slips already handed out

[Anonymous Coward]

At least one person I know personally has lost his job in this round of layoffs. He had been with the company for 27 years (before they even started making processors).

Re:Pink slips already handed out

[ch-chuck]

Doesn't add up: 2006 - 27 = 1979.
Intel was making processors way before 1979.

Re:Pink slips already handed out

[Anonymous Coward]

maybe the guy's relationship with the company wasn't continuous?

Still, 27 years is a lot of time to have spent with a company.

Re:Pink slips already handed out

[Anonymous Coward]

My mistake. But until the 80s RAM was their primary product.

Re:Pink slips already handed out

[Anonymous Coward]

I hate to say it, but just because he was there for 27 years doesn't mean he was any good at his job. Maybe he was just able to stay under the radar and avoid being noticed for a long time. I know plenty of people like that. They are incompetent, and do little so they don't get noticed. This is because as soon as they are noticed they WILL get fired.

I have no pity for incompetents with seniority.

Re:Pink slips already handed out

[Anonymous Coward]

But he was not fired, he was laid-off. And being laid off does not mean that he was bad at his job. What is means is that Intel decided to sack their middle managment and replace them with younger folks with lower salaries, all so their stock could go up one point.

Lumberg

[crhylove]

So how much time do you spend a day on these TPS reports?

Re:Lumberg

[Anonymous Coward]

yeaaaaah.

It figures...

[AWhistler]

I got blasted on here when I said that Intel was finally doing something right by lowering prices and finally competing with instead of stagnating. Now it seems that Intel is shooting themselves in the foot. Their management does something right, then they get laid off before they can reap the fruits of it. Sounds like what the management at HP is saying now about getting rid of their CEO a coupld years ago. They didn't like that she wanted to buy Compaq, thinking it was a bad idea. Well, it seems that today it wasn't such a bad idea.

oh well, I supposed Intel hasn't really changed at all, and actually discourages it.

Re:It figures...

[drinkypoo]

I got blasted on here when I said that Intel was finally doing something right by lowering prices and finally competing with instead of stagnating. Now it seems that Intel is shooting themselves in the foot. Their management does something right, then they get laid off before they can reap the fruits of it.

Poppycock. Basic business strategy says that managers should only manage like 5 or 6 people because of the relationships involved. What is it called, factorial? (I am unabashedly math-challenged.) Where it's 1*2*3*4* et cetera? The number of relationships in a group grows very rapidly. Thus, intel probably has a super fuckload of managers and can stand to lose a whole bunch of them.

Even more significant, however, is the fact that the majority of managers aren't making intel's major business decisions. They didn't say they're firing executive management and kicking people off the board - THAT is where the decisions are made.

Most bureaucracies have an overabundance of managers.

Re:It figures...

[WilliamSChips]

What is it called, factorial? (I am unabashedly math-challenged.) Where it's 1*2*3*4* et cetera?

That would be the factorial.

Re:It figures...

[Anonymous Coward]

I got blasted on here when I said that Intel was finally doing something right by lowering prices and finally competing with instead of stagnating. Now it seems that Intel is shooting themselves in the foot.

The main problem is that change doesn't happen instantly. If you sell 1000 widgets at $50 a pop, you make $50,000. If you lower your price to $25, you're not suddenly going to start selling 2000 widgets. It will take months (or years) for the market to catch up to your new price. During that time you may need to cut costs to make up for the sudden and drastic reduction in revenue and profit. Unfortunately, the only way to cut costs fast enough is to let some people go. It seems perverse, because you're laying people off knowing full well that in a year you'll be hiring like crazy. But that's the way the world works.

This is probably the part where you're thinking "That evil Wall Street, forcing companies to think only about the immediate future." The problem is that your revenues may never recover. It may be that, even at half the price, people just don't want enough of your widgets to break even. So it's perfectly reasonable for investors to be suspicious about plans like this. You may sell 3000 widgets at $25, or you may only sell 1000. It's absolutely rational for investors to demand that a company plans for the worst even as it hopes for the best. And the worst is that you don't sell a single extra widget even at half the price.

Re:It figures...

[Anonymous Coward]

They didn't like that she wanted to buy Compaq, thinking it was a bad idea. Well, it seems that today it wasn't such a bad idea.

Huh? I must've missed the part where the Compaq acquisition is now widely considered a good move... can you summarize the recent events that caused the change in people's thinking?

Re:It figures...

[AWhistler]

Yep, you missed it. How soon people forget...

http://slashdot.org/article.pl?sid=06/07/08/125925 5

Re:It figures...

[Anonymous Coward]

Is that it? That's more of a blog post than an article. The company was in the sewer when Carly the charismatic visionary was fired, then Hurd the boring operations guy does his thing cutting costs and the company is back on track. Now people say Carly did that?? Carly says that in her book, because that's what CEOs and ex-CEOs do. They take credit for everything good, and as for the bad, it's "I should've fired so-and-so earlier... I wanted to be loyal but he was in over his head". She was just about to fire 15,000 employees... riiiight. As for the PC business, they may be #2 in sales but it is a low margin business - IBM gave away its leadership position and ThinkPad brand name to bail out of there. Dell is shooting itself in the foot with quality and support problems, not to mention their rebate scams pissing off their longtime customers.

Snark

[ewhac]

Do the people left behind get bigger cubes?

Seriously. The Folsom facility is a sea of nothing but 6*8 cubes. It's completely cheerless. Those people really should have more space.

Schwab

Re:Snark

[Anonymous Coward]

Seriously. The Folsom facility is a sea of nothing but 6*8 cubes. It's completely cheerless. Those people really should have more space.

It's a nice theory but if we gave them any more room to move around, I doubt the feeding tubes would stretch.

10% cut?

[kripkenstein]

TFA says:

... predicting Intel would reduce its work force by more than 10,000 employees

and

...Intel had about 100,000 employees

So, the 1,000 managers will be followed by some 9,000 more, for a total of about 10% of the workforce - if the predictions / estimations are correct. If so, then this is very significant.

I personally know three people who worked at Intel, one who still does. All worked in the same division, so this isn't a representative sample. But all of them saw money thrown around quite freely, including on hardware and on salaries (which are among the highest in the area here). I hope they tried to cut other things before they started firing.

Re:10% cut?

[flooey]

I personally know three people who worked at Intel, one who still does. All worked in the same division, so this isn't a representative sample. But all of them saw money thrown around quite freely, including on hardware and on salaries (which are among the highest in the area here). I hope they tried to cut other things before they started firing.

Well, I don't think it's that simple. If you reduce employee benefits, you risk having some of your best people (the people who could most easily get jobs elsewhere) start leaving. By having a layoff, you're hopefully going to be getting rid of some of your worst people. So, it may be wiser (from a business perspective) to lay off people rather than cut benefits, even though it's not very nice.

Re:10% cut?

[Anonymous Coward]

My manager was just laid off (I'm a blue badge).

It's not that he is incompetent, just redundant. I have meetings with his boss at least monthly, and so do the other engineers and managers on my team.

If someone is necessary, they will not fire them. This guy was smart, but useless in his position. He would be equally useless elsewhere, because his technical skills were replaced with corporate management BS - and he's only a 2nd-level manager.

Intel will be weird for the next 3-6 months.

Re:10% cut?

[ackthpt]

Well, I don't think it's that simple. If you reduce employee benefits, you risk having some of your best people (the people who could most easily get jobs elsewhere) start leaving. By having a layoff, you're hopefully going to be getting rid of some of your worst people. So, it may be wiser (from a business perspective) to lay off people rather than cut benefits, even though it's not very nice.

When I've seen layoffs good people often do depart because being in a company, never knowing if you're next to clean desk, is very stressful. Some simply don't wait for the severence, but proactively find somewhere else to go. It's all part of the risk that the company may lose a keystone employee here or there.

I worked one place for years and rather than layoffs they offered early retirement bonuses. They didn't just lose dead wood, heck dead wood with an easy ticket loves to stay around, but many excellent people, too. Ultimately some had to be contracted back. Similar to another place I worked.

Re:10% cut?

[pluther]

When I've seen layoffs good people often do depart because being in a company, never knowing if you're next to clean desk, is very stressful.

And Intel tends to do layoffs in waves. So, instead of just laying off everybody they're going to all at once, they'll get rid of loads of contractors first, then middle-management, then two or three passes through regular employees. So, whenever they have a layoff, everyone there knows to expect another soon.

When I worked for Intel, I updated my resume after the first couple of rounds, just to be ready. Since I had gone through all the trouble of updating it, I went ahead and posted it to a couple of job sites. Recruiters found it, and found me a much better job. So I left. It was probably about 50/50 whether I would have kept my job there if I hadn't.

And, yeah, this wasn't a surprise. I've got a few friends who still work for Intel, and they've mentioned hearing rumours of an upcoming VSP for a couple of months now.

Re:10% cut?

[TopShelf]

One part of the productivity gains that we have enjoyed in the US over the last 15 years or so have come from layoffs - it's a well-documented case of exactly what you're saying. Layoffs target the less productive aspects of a business, thus raising overall output per worker.

Re:10% cut?

[sgt_doom]

Hold it!!! I don't understand!! What about all those millions of chips Intel was going to sell to the Chinese??

And speaking of which, whatever became of all those millions of toothbrushes the Chinese were supposed to buy --- according to that crack American corporate management???

And those cost savings from offshoring soooo many American jobs....and importing soooo many H-1Bs, H-2Bs, H-2Cs, L-1s, J-1s, O-1s, etc., etc., etc.???

Re:10% cut?

[Monkelectric]

Yes, I've been through this as well. The company makes people nervous, and all of your *TOP* talent leaves because they're top talent, they can get a job anywhere. You loose signifigant domain knowledge with those people. Then the middle teir starts leaving under the stress of having to do *ALL* the work (remember: the bottom does very little work). Eventually you are left with a few middle teir people, and everyone who never should have worked for you in the first place.

I find layoffs to be a logical fallicy. Unless you are reducing your product lines, or support, or sustaining engineering ... Then you're either saying "We are overstaffed and therefore fuckups" or you're saying, "We plan to abuse our current employees into doing more work." Either way, a sign taht the end is coming.

Re:10% cut?

[Anonymous Coward]

You're not allowed to lay off your worst people, at least in California. That opens you up to lawsuits, where you'd have to prove *why* such-and-such a person wasn't adequately doing their job. All you're allowed to do is remove positions, and whoever happens to be in them. E.g., you can kill off a project, and let everyone on that project go.

This sometimes leads to pre-layoff rounds of musical chairs, where new projects are created, and good people reassigned onto them for safekeeping, before killing the old projects. You have to be careful to not be too obvious about it, though.

Re:10% cut?

[DaveInAustin]

I hope they tried to cut other things before they started firing.

Yes this did cut at least one thing. Maybe they shouldn't have, since AMD started beating them with CPU's designed in Austin.

Re:10% cut?

[Grishnakh]

So if layoffs end up scaring off all the great employees, how should a company get rid of its worst employees? I only ask this as idle speculation.

Off the top of my head, I'm thinking that the fact that the company has gotten to the point that it has to do layoffs means that upper management has basically failed, and things are now so screwed up that layoffs are the only way to possibly survive. If they had done things properly to begin with, they never would be in this spot.

On top of that, it seems like companies should have good systems for reviewing employees' performance, and eliminating the poor performers early, before you get into a bad situation. The only problem this seems to have is that it would probably create a highly competitive environment, where people stab each other in the back so that they aren't part of the bottom 5% that needs to be eliminated, and the stress eventually wears out even the good people who go on to other jobs. Some people (including myself) don't really thrive on competition, and would rather just do interesting and enjoyable work instead of worrying about how their performance compares to the next guy.

Intel was like this for a long time, I believe. They had very comprehensive performance reviews, and people were ranked according to their contributions. The bottom 5% were put on probation, and eliminated if they didn't improve fast. Seems like a sensible system, but in reality I don't think it worked all that well; some people are just much better at "selling themselves" than others. Engineers aren't exactly known for their social skills.

If you (anyone who cares to respond, not just the parent poster) had a large company, how would you structure it to keep the best and brightest employees, and eliminate the deadwood? Honestly, I'm not sure any company has come up with a good solution to this problem.

Re:10% cut?

[Black Art]

So, the 1,000 managers will be followed by some 9,000 more, for a total of about 10% of the workforce - if the predictions / estimations are correct. If so, then this is very significant.

I believe the Romans called this Decimation.

Re:10% cut?

[JanneM]

So if layoffs end up scaring off all the great employees, how should a company get rid of its worst employees? I only ask this as idle speculation.

By and large, I don't think it's possible to really purge an organization of the worst people (apart from the tautology that there always are "worst people" no matter how good everyone is). I strongly suspect that there's a deeper dynamic going on that makes them as neccesarily present as the inevitable few stars.

No matter what kind of performance review or ability measure you apply, most of the "worst people" (assuming actual substandard performers, not grading on a curve) will pass anyway. Remember, these people came through the hiring process intact; a review and examination rather more thourough than any summary performance report while at work. And after they've been at work for some time, they have contacts, friends, nowledge of the internal process and so on that makes it even more difficult to find and target them (to the exclusion of the people you want to keep).

And this of course leads into the essential deficiency of performance reviews: do they actually measure what you're after? The actual individual output of lines of code or whatever really isn't what the company is all about after all. If you focus too myopically you risk microoptimizing your employees to the detriment of the organization as a whole.

For example, some of the bad performers that pass anyway do so because they're likeable, have a wide net of contacts, keep up with the office gossip, maybe party animals always ready to suggest a department out on the town. Those people are in reality doing a hugely important job (without being aware of it). They are providing a lot of the social grease necessary to have the department work reasonably wel despite plenty of strong-willed, socially clumsy (but excellent) workers. Get rid of them, and you'll see a productivity decrease among the other staff instead; and probably one that more than offsets what you gained. Not until another amiable screwup is transferred to the office will productivity go up again.

Performance reviews really should probably be at a departmental, not an individual, level, and largely ignore individuals. And with a team performing at a substandard level (and after you've ascertained it's not because of the nature of the projects they're involved in), you should probably focus on finding the group dynamic reasons for it and look for ways to improve it, either by transfer in (or out) people, or in extreme cases to split the group and integrate the members in other groups instead. Note that the head of the group or depratment too is a member and does not have sole responsibility (though of course more individual responsibility than the other members).

And the real disastrous employees, well, don't worry about them; you don't need reviews to find them, and rarely an excuse to get rid of them. Just wait until the police, fire department or the CDC has identified the idiot who caused the whole mess and get rid of them.

Re:10% cut?

[Anonymous Coward]

This is the second time i've seen this word used correctly. Thank you sir!

Re:10% cut?

[afidel]

I don't think that's true at all. Cisco routinely gets rid of the bottom x% of employees and they are based in California. Unless they do things differently in HQ then elsewhere they are doing exactly what you are saying they cannot do. Perhaps they just document things sufficiently to get around lawsuits?

Re:10% cut?

[Ex-MislTech]

For example, some of the bad performers that pass anyway do so because they're likeable, have a wide net of contacts, keep up with the office gossip, maybe party animals always ready to suggest a department out on the town. Those people are in reality doing a hugely important job (without being aware of it). They are providing a lot of the social grease necessary to have the department work reasonably wel despite plenty of strong-willed, socially clumsy (but excellent) workers. Get rid of them, and you'll see a productivity decrease among the other staff instead; and probably one that more than offsets what you gained. Not until another amiable screwup is transferred to the office will productivity go up again.

Sounds like a poster Ad for AA members to me.

The biggest issues I see are nepotism, lack of TRUE technical interviews, and
verification of skills.

So many of the companies I have worked for the ppl doing the hiring often
do not have the mental where with all to ask the questions to see through a charlatan.

Deadwood is often kept, and boat rockers that are technically literate, but not
brown nosers are tossed to the sacrificial altar due to someones ego being bruised.

Boat Rockers will make change even if it makes ppl look bad, upsets the status quo,
or takes the limelight or steals the thunder of the favored in social circles.

I have seen more than a few ppl added to the layoff rolls due to their
"making others look bad" because they outperformed them, or fixed a GLARING
mistake and it made someone "popular" look like a slacker because he spends most
of his day walking cube to cube talking about the new hot chick or sports
or what they saw on TV last night or some other non-work related fiasco.

Ppl where I work now spend up to 30 - 60 min. of their work day talking about TV shows.

I have always seen the hard working group of not so popular ppl in most
companies that are the first to stay late, are often NOT the most visually
appealing and are often social outcasts.

Not all but most of them are the sled dogs, doing a large portion of the
bulk work, and its often not the pure theory or creative kind, but just
as needed as debugging is though is mind numbing.

Software Development needs Software Test and Support to sustain code/product
thru all its phases and cycles.

Alot of ppl allude to something akin to elitism, and there are some "key" ppl
to be sure, but if they could do it solo why are they working for a company
in the first place? Because they are just one piece of the puzzle, though
it might be a rare and critical one.

If you want the sled dogs to respect you, your going to have to respect them to a degree.

We know we are not going to get the top tier pay, and we know we are not going
to get the perks, nicer offices, and social circle, but some appreciation
and acknowledgement goes a long ways.

Peace,
Ex-MislTech

Re:10% cut?

[G-funk]

So if layoffs end up scaring off all the great employees, how should a company get rid of its worst employees?

Cut once and cut deep. It's the "waves" of layoffs that really nosedive morale and frighten the easily-employable to jump ship.

-Josh

Re:10% cut?

[treeves]

This is Oregon. You don't have to to have any reason whatsoever to let people go. It's an at-will employment state, meaning neither employees nor employers have any right to expect any sort of obligation from the other. Two weeks notice is nice, but even that's not required. The only chance a terminated employee has of legal recourse is in a clear case of employment discrimination, and there are inly a few cases that meet the requirement (i.e. age, religion, sex) and it has to be clear. For example, if they let 1000 people go and they're all over 55 and all the other people in equivalent positions who are under 55 stay, that's pretty clear.

I know for example, that they're combining two groups - FMO (Fab Materials Organization) and FMSO (Fab Materials __ Organization)- into one group - GFM (Global Fab Materials) - and eliminating the redundant positions between them. But there's nothing legally preventing Intel from getting rid of what it considers relatively poor performers.
Now Santa Clara may be a different situation entirely.

Re:10% cut?

[Monkelectric]

So if layoffs end up scaring off all the great employees, how should a company get rid of its worst employees? I only ask this as idle speculation.

Its pretty easy actually. The place I work offered retention bonuses during a difficult period. Basically contracts which offered a bonus if the employee stayed after a certain date. The problem was the bonuses simply highlighted the incomopetence of our management. They were only offered to "key people" which created a division between those who got them and those who didn't. But far worse then that -- people who were seriously critical to the company were *NOT* offered bonuses, and a lot of deadwood was! So in this case -- trying to retain the employees was far worse than doing nothing at all.

As far as deadwood it comes back to good management. *VERY* few companies have good management. If you have a good manager he should be able to identiy who in his group is performing and who isn't. However, more frequently management is concerned with politics, with race, , and with protecting their turf. For Instance, our test engineering group is run by a vietnamese guy, and he only hires vietnamese people, and has even *FIRED* people who aren't vietnamese for expressly that reason. He hired a vietnamese programmer who is a *COMPLETE* idiot -- the guy has to ask us questions about how to do things like comparing variables! My point is, as long as there are concerns other than the best interests of the company -- you cant hope to eliminate the idiots.

Re:10% cut?

[raider_red]

When I've seen layoffs good people often do depart because being in a company, never knowing if you're next to clean desk, is very stressful. Some simply don't wait for the severence, but proactively find somewhere else to go. It's all part of the risk that the company may lose a keystone employee here or there.

I'm seeing this happen at my company right now. In fact, I turned in my notice today after getting an offer from a startup. Back in November, we laid off 5% of the "dead weight" or those who had scored low on their annual reviews. The thing is, we really didn't have much dead weight, and the distribution to determine the five percent was very forced. Basically, management said thou shalt cut 5% of your engineering staff for each and every department. Since then, we've lost three device engineers, half the layout staff, and one of our principal engineers was spotted running around the parking garage making suspicious phone calls. I'm getting out before I piss someone off and land on the "refresh" list.

Re:10% cut?

[MadUndergrad]

So wait, are they being laid off or beaten to death with helmets by their coworkers?

Re:10% cut?

[Anonymous Coward]

I've got a few friends who still work for Intel, and they've mentioned hearing rumours of an upcoming VSP for a couple of months now.

There will be no VSP--trust me on this. Intel learned the hard way back in the dotcom bust-era downsizing of the 2001-02 timeframe. All the people who were too mediocre to be self-confident enough to strike out on their own, stayed. All the good people who wanted a change--say, to go sail around the world, or retire and go into missions work--took VSP and left.

VSP's help accelerate the bright-sizing of a company. Expect, instead, a continuing trickle of jobs moving overseas, bit by bit enough to be under the radar.

Re:10% cut?

[tehcyder]

Ppl where I work now spend up to 30 - 60 min. of their work day talking about TV shows

Why do I get the feeling that you actually time them with a stopwatch?

Re:10% cut?

[EastCoastSurfer]

Off the top of my head, I'm thinking that the fact that the company has gotten to the point that it has to do layoffs means that upper management has basically failed, and things are now so screwed up that layoffs are the only way to possibly survive. If they had done things properly to begin with, they never would be in this spot.

You hit the nail on the head. The purpose of layoffs isn't to purge the company of the worst performers (although it would be nice if that was possible). The purpose is to get rid of resources the company cannot make use of. Intel is basically saying that they have all these resourses that they can't make use of for whatever reason, and you're right in saying that it's the fault is completely upper managements.

Re:10% cut?

[Rhett's Dad]

I recommend reading Ricardo Semler's book "The Seven Day Weekend" for an interesting way to manage the employees of a large company. It really makes the typical authoritarian CEO/Board style rather laughable.

The last fifteen years of listening to CNN and Wall Street makes me think that unless YOU are the one who built the company up from your garage into a $10B business, then YOUR interest in the company as CEO/Board is what YOUR cut will be after the profits, after the layoffs, and after the sellout to bigger company that wants to eat you. Your heart is not in it, and therefore everyone in the company that suffers from your "leadership" is not in your heart either.

Re:10% cut?

[mkw87]

Didn't happen to be General Electric did it? They are quite notorious (in a good way) for this, lots of people retire around 50-55 with good plans.

Re:10% cut?

[geekoid]

What, you think the technology knowledge vanishes when soneone moves into management?
Please.

Intel had always been wierd.

NOT GOOD

[tomstdenis]

Given where I work [and this post is not on behalf of my employer!!!] I don't view this as a good thing.

Sure Intel should be taken down a peg but competition is what will make technology not only efficient but RELEVANT. If only one supplier makes all the processors on Earth they can stagnate and not improve things. That's bad.

If anything Intel motivates AMD, just as AMD motivates Intel. [without going into too much details]. Hopefully, if this report is true it's not the tip of the iceberg but just adjustments to marketshare.

I look forward to getting my MCW setup later this year, pitting it against my personal AMD gear and doing more LibTomCrypt benchmarks for years to come. Of course, if Intel hooked me up with that stuff for free that'd be nicer ...hehehe

Tom

Re:NOT GOOD

[Cal Paterson]

You've got this all wrong.

Intel are the big player in the CPU market at the moment. Even though AMD is quick/cheaper depending on who you talk to, it's still Intel that has around 80% of the market share of CPUs, as well as strong fingers in a couple of other pies. It's also Intel who have all the deals with machine builders, such as Dell.

Intel doing a little worse is going to increase the amount of competition in the market. Until very recently they were the monopoly. This is akin to saying Microsoft anti-trust lawsuits will reduce the competitiveness of the market - it's totally the wrong conclusion.

Re:But what about the new Conroe chip?

[tomstdenis]

Hint: Conroe while better than Intels current offerings isn't really that much better than AMD offerings. Specially when you factor in the non-desktop uses (e.g. cluster computing where HT links still shine).

Conroe is a good product, hopefully a good design (won't be able to say for myself until I get one...) and will give AMD a run [in my personal opinion] but it won't break the mold and leap ahead of the competition in any sense.

Tom

Re:But what about the new Conroe chip?

[merreborn]

why do the 1,000 have to go only two days before Conroe appears? Couldn't Intel just hang on for a few more weeks until the Conroe sales take off?

Dead weight is dead weight, wether your company is on the rise, or is in a downward spiral. If employees aren't earning their keep, they need to go.

Intel should layoff 1 manager

[Coward Anonymous]

It's funny how when a company does very well, the CEO takes credit for all the brilliant choices s/he made. Yet, when a company flails, it's not that CEOs fault until after it has been thousands of underlings' faults.
Otellini should resign. He stands for all the things Intel is/was not. He's a marketroid in what was and should be primarily an engineering driven organization.

Re:Intel should layoff 1 manager

[Rogue Pat]

Otellini should resign.

But who will lead the company then through troubled times?

I know this can be read as being sarcastic or a Troll. But i'm not a organization expert. I'm just truly wondering how to decide when it's best for a company for the CEO to step UP and when it's time to step DOWN?

Re:Intel should layoff 1 manager

[Askjeffro]

I agree with your first comment, but considering the question of whether or not Paul as a marketer is a good choice as CEO, I disagree.

Intel previously succeeded due to a market boom in CPU demand and a clear need for the processors to be as best as possible. With engineers leading the charge technology development was high, and the marketplace took care of itself. Now with increased competition, low differentiation among product, and the market slowing, a marketer like Paul is exactly what Intel needs, someone to find new opportunity and realize demand.

Recall Craig Barrett, former CEO and engineer, was responsible for Intel's largest business failure to date, the mobile phone division. This is a classic example of an engineers approach to business verses that which Paul should be bringing to the table. Craig's approach, simply make more processors in a different industry, its not that simple. He failed to understand the full stack of requirements of doing business in that sector while failing to understand the competition. Is Paul going to be able to realize and generate the demand necessary for Intel to maintain its high margins? I doubt it, but I'd much rather see someone trained in business then an engineer trying to overcome Intel's present challenges.

As an Intel employee this post represents my own opinion and not necessarily the opinion or views of Intel or anyone else at Intel.

Re:Intel should layoff 1 manager

[Overzeetop]

Should there ever exist a situation where is becomes "time for the CEO to step up," you have exactly pinpointed the moment when the situation has gotten so bad that even the bad employee knows that he/she is doing a crappy job, and should have been fired long ago. CEO's get paid to lead, and if you're not actively leading either (a) the company is satisfied with the status quo or (b) you're not doing your job. Just as a point of clarification, in anything other than a small, family business, the condition (a) does not exist. In the rare circumstance that (a) does exist, there is no need for a dedicated CEO; an experienced memeber of staff can lead the senior staff in reviewing the status quo each quarter or year - and that's the entire time that need be spent on the task.

Re:Intel should layoff 1 manager

[LadyLucky]

He's a marketroid in what was and should be primarily an engineering driven organization.

How do you figure this? These so-called maretroids are the ones that know what needs to be built to keep the company successful. Intel should be a market driven company. In order to do that, you need an extremely good marketing group and a CEO from this background can be very beneficial. No engineering driven company can last because while the products might be well made, they make the wrong products.

Re:Intel should layoff 1 manager

[Grishnakh]

Since Netburst and the mobile phone division were both done on Craig Barrett's watch, I think he should be fired as President, and also have a large chunk of his past salary taken back.

Paul is really inheriting a lot of this mess, although I still think he has a share of the blame.

Re:Intel should layoff 1 manager

[tyrr]

I guess you also believe that it's more difficult to determine what needs to be build than to engineer and produce a high quality product.
Marketoids are NGAA (Never Getting Anything Accomplished) for a very good reason - they have no idea how to actually turn their ideas into reality. In fact, marketoids are out of touch with reality.
Market driven doesn't mean lead by marketoids. Market driven means delivering high quality products because this is the first thing that customers want. Pay attention to two words there "delivering" and "quality" - that's what engineers do.
Now look at Intel - it failed to deliver competitive products. It doesn't matter what's their marketing strategy, if someone else creates better products than you do.

Re:Intel should layoff 1 manager

[Coward Anonymous]

"market boom in CPU demand" - which was largely driven by Intel's initial pioneering of the microprocessor and its relentless drive to make it faster and smaller (and power hungry... :). Its success was later bolstered by very good marketing but that didn't come and till after it was the dominant player.

You are saying is that there is nowhere for Intel to innovate on the technical side to the extent that it did historically. The approach is reactive and it doesn't lead to revolutionary innovation. It also sounds defeatist to me.

Re:Intel should layoff 1 manager

[Coward Anonymous]

If what you say were correct then Intel would have never come up with the microprocessor. Intel created the microprocessor market.

Re:Intel should layoff 1 manager

[rohan972]

I guess you also believe that it's more difficult to determine what needs to be build than to engineer and produce a high quality product.

Not more difficult, but more imortant, or just as important.
Marketoids is a derogatory term that has no useful meaning in a discussion about business.

Market driven means delivering high quality products because this is the first thing that customers want.

Market driven means demand driven. Demand is determined by percieved needs/desires. Percieved needs/desires are more heavily influenced by marketing than engineering, I'm not saying that's how it should be, just that's how it really is. Customers do not first want high quality, sorry. Most customers (not necessarily smart customers, but most) want quantity of goods before quality (Most people will buy enough cheap clothes to wear all week well before they buy a tailored suit). Think Wal-Mart, McDonanlds etc. High volume cheap crap.

There are, of course, segments of the market where this is not so true, more tech oriented fields, finance industry etc. For the majority of the home PC market though, once the tech is "good enough" (can play games, process video etc) further increase in quality is way down in the list of priorities, below low price, feeling good about the purchase etc, etc. Making them feel good about the purchase is king. Quality is only a small part of this, sales/marketing is most of it.

That said, while quality is a small part, a certain level of it is necessary, and if not looked after, no amount of marketing will save the company. Engineering and quality are essential, but not predominant for a business.

Re:Intel should layoff 1 manager

[Askjeffro]

I think that is a fair point, but let me try and be add to my original statement with this:

I don't believe that Intel can not innovate further, the question now is where to innovate. The improvements in processors the last several years have offered marginal gains for the average consumer. The key word here is "average".

Typical business PC's and home PC's are used for overwhelmingly for 2 things: Internet access, and office tasks. Looking at the research into PC users practices its clear that the largest pool of potential customers (>85%) don't need a new processor to do what they are doing. On the contrary, a average home or business user now typically only upgrades due to either mechanical failure of a PC or being serious software issues.

This is the very reason Intel is pushing Viiv and other platform strategies aimed at getting consumers to use their PC's in new applications which will expand that market they so need to keep up with the years (market boom) where everyone was buying a PC either get on the internet or enable their child to "do well in school".

Further evidence is the huge push Intel is putting into oversees markets, they are trying to establish a role there now, but since most countries fail to have the income to support Intel's desired high margins, its proving very difficult. I don't doubt that Intel "made the market" in the 90's, I'm just of the camp that old model is dead (The writing has been on the wall here for years) and new approaches have to be taken if Intel wants to enjoy the same level of margins as before.

Because development is done now.

[Anonymous Coward]

We've already seen from the hype and benchmarks of the pre-shipping chips that Conroe is going to be a very good chip that will put Intel back in the driver's seat so why do the 1,000 have to go only two days before Conroe appears?

Because now that the development is done (for a chip that will likely be Intel's staple for a long time to come) the managers are no longer needed. This is a sign that Intel's processor chip development has now reached a plateau and will stagnate.

Re:Because development is done now.

[monopole]

This is how Intel got to this point to begin with. If I remember correctly, there was a big purge of experienced designers after the P3 came out, when it came time for the P4 (Prescott) they didn't have enough folks who could work from a clean sheet of paper. They got by on superior fab until the P4M showed up from a non-decimated division. On the other hand AMD went on a hiring binge for good processor designers and has had the upper hand ever since.

Re:Because development is done now.

[Anonymous Coward]

Hmmm, that really isn't the way I saw it.

The original P4 design was to include the extra processing units and enough cache to effectively use the extended pipeline they built into the units. However, just before release, the design was scaled back to decrease cache and processing units. It wasn't done for technical reasons like chip yield but simply to increase "bucks per nanoacre".

When the part was released in this castrated version, the resulting wasted memory bandwidth to keep filling a too-limited cache due to a now superfluous extended pipeline made the first P4 a poorer performer than the PIII!

In short, I don't think these were entirely technical problems. The engineers designed a part that was intended to work well within one set of rules and resources only to be forced to go back and hack in changes for a more limited set of resources because management forced them to. Pure case of hubris; Intel thought the market would pay premium prices for poorer preformance simply because it was stamped "Intel" so they milked it.

Now the disclaimer: I am not working for Intel and I have no idea of the internal workings at that time. However, I did read the technical briefs describing the part as it was being developed and scratched my head mightily when it came out without all the technical marvels they described. I also remember press relaeses describing last minute changes forced by management with vague reasons that any savvy reader could see just added up to more profit for Intel with the cost of poorer performance for the end-user.

$1 Billion from 1000?

[flipsoft]

"(Intel)...laying off 1000 managerial positions....in an effort to save the company $1 billion a year."

So $1000000000/1000=$1000000 !!!

Those are some high paid managers at a million a piece! No wonder their chips were so expensive.

-flipsoft

Re:$1 Billion from 1000?

[froschmann]

You forgot the other 9000 people...

Re:$1 Billion from 1000?

[slackmaster2000]

Well you have to factor in the additional costs such as mandatory benefits (unemployment insurance, social security, comp, etc), administration, facilities, additional benefits (healthcare, vacation, etc), family/military leave, and so on. While I'm sure the average manager was paid very well and some were paid extremely well, the average annual salary per manager wasn't a million dollars.

I think I read recently that on average employers are paying nearly 30% above wages just for mandatory and optional benefits alone. I don't think that includes the cost of administration and facilities. (feel free to post a real number if that value is way off, I could be wrong).

Granted that could still mean that the average salary was like $700,000, which isn't exactly chump change!

Paying employees well is something that I'm not going to have gripes with, though, as long as the wealth is distributed fairly (not equally, but fairly) and the company has the foresight to not run into a situation where it has to axe thousands of employees to make ends meet. People are the most important resource of any business, and its important to not overpay nor underappreciate.

These savings are just 1/38th of what Intel brought in last year, and somewhere around 1/10th of their profit. Trimming the fat is always a good idea, but when that "fat" is human beings who are depending on their jobs, employers have a certain responsibility to not get bloated in terms of workforce. The good thing is that these are obviously well-paid managers (unless just a few are making huge bank), and might not be as bad off as employees living paycheck to paycheck with few assets.

Re:$1 Billion from 1000?

[afidel]

30% seems really low, for entry through mid level people the number I have heard is closer to 40-50% of total cost is non-salary. Of course I'm not sure how much of that is facilities and support and how much is non-salary compensation. I don't think that a spreadout layoff like this saves you anything on facilities, only axing total divisions does that. Besides all that I think $1 Billion is for this round and the accompanying round of non-managerial layoffs.

Re:$1 Billion from 1000?

[Anonymous Coward]

Do folks really think FLMs at intel are paid $700,000 or $1M each? come on, more like $80-$120? heck, we should all run, not walk to try to become one.

the $1b will mostly come from other spending cuts this year, this is more to improve decision making by removing layers and having manangers managers and save a small amount of $. In '07 there will be some savings from the, per math above $100M or so not $1b.

Laying off 1000 managers saves $1B?

[Anonymous Coward]

Let's see now... 1 billion divided by 1000... Each manager is costing them
a million dollars a year?!? Does Intel pay really really really well or is
a shockingly large number of managers leaving work each night with their
pockets stuffed full of Pentium Preslers?

It sounds like their problem is less of having too many employees and more
of top management having no idea where their money and resources really are.

Re:Laying off 1000 managers saves $1B?

[Overzeetop]

No, but there are rumors about 5000 or 10000 layoffs in all. Based on freshout salaries that intel is giving out, I'd say the 5000 number (1k managers, 4k dead weight) should hit that $1B mark, once you count labor burden (benefits, non-fixed overhead, non-fixed G&A).

Re:Laying off 1000 managers saves $1B?

[kinzillah]

Perhaps they were getting $100,000 in salary and making $900,000 worth of bad decisions a year. That would certainly be a good reason to throw them overboard.

CxO pay cuts?

[DAldredge]

How much of a pay cut will the Board of Directors and CxO's take?

Re:CxO pay cuts?

[Anonymous Coward]

Mod Parent Up, +1 Funny!

Re:CxO pay cuts?

[sprash]

As per Reuteurs , Otellini gets paid $3,291,700 annually (Excluding options compensations)

I'm affected.

[Anonymous Coward]

Posting AC for obvious reasons.
Two hours ago my boss told me he was laid off as part of these efforts.
The interesting thing is that I just hired in to Intel 5 months ago.

Time to dust off my resume.

Intel Vendor Link?

[Anonymous Coward]

Why is AMD the only company listed under Vendors in the Slashdot menu? Are they the only ones who ponied up for a Slashvertisement campaign to defame their competition?

Re:Wow! I want to work for Intel!

[Anonymous Coward]

Just because it costs Intel 1,000,000 per manager does not mean all that money goes to them. Probably over 1/2 of it goes to overhead costs for that employee (SS-Tax, benifits, Manager's Management, Admin, etc etc). Its scary just how much over the salary someone costs.

*Steal* market share ?

[alexhs]

microprocessors from AMD continued to steal market share

First AMD stole Intel instruction set, and now they're stealing Intel market share !

When will they be ordered to hand them back ?

Re:*Steal* market share ?

[AaronHorrocks]

Smaller insightful companies that compete and disturb the ways of the big lumbering companies always "steal" from the giants. heh, that's what they say anyhow.

Billion dollars to enter market

[Anonymous Coward]

Every business has a barrier to entry, and a new entrant always risks losing the resources they spent overcoming that barrier.

Quick, look up how much it actually costs to build a chip making plant: One Billion plus.

Not too many organizations can ramp up to compete!

Re:Billion dollars to enter market

[Millenniumman]

There are many companies worth over a billion dollars, relatively speaking.

Here is the internal email...

[Anonymous Coward]

Here is the internal email from Intel CEO sent to all top level managers. This is sourced from a relative that has been working there since the 1970's.

------

From: Otellini, Paul
Sent: Thursday, July 13, 2006 8:14 AM
Subject: An important and difficult step: Manager reductions

To: All Intel employees

This week we're taking an important and difficult step in our efficiency project: reducing the number of Intel managers by about 1,000 people worldwide. Only managers, ranging from senior to first-line, are affected. This step is important because it addresses a key problem we've found in our efficiency analysis--slow and ineffective decision-making, resulting, in part, from too many management layers. It is difficult because the managers who will leave the company are our colleagues and friends, and since we have limited internal job opportunities, redeploying their skills is not a viable option.

We are notifying the majority of impacted employees on Thursday and Friday this week, and (except where a country's laws require different steps and timelines) we plan to have all affected employees informed by Monday, July 17. In the U.S., most employees' last day of work will be July 28, and their benefits will include a minimum of about three months' separation pay (and more for lengths of service over two years). In other regions the process and benefits will differ. While we can't eliminate the impact to these employees, we're committed to offering them support during this difficult time.

This manager reduction is one of the first major actions coming out of our structure and efficiency project, and I believe it's an essential first step toward making us more competitive. Over the last five years at Intel, the number of managers has grown faster than our overall employee population. Our efficiency analysis and industry benchmarking have shown that we have too many management layers, top to bottom, to be effective.

In addition, this finding is consistent with what our organizational health surveys have suggested: that the relative increase in management has impaired decision-making and communication, reducing the company's efficiency and productivity. Many of you have made the same point in your individual inputs to the efficiency team.

As I've said in previous Webcasts, one of the outcomes of the structure and efficiency project is that we'll be a leaner and more agile company. We'll make quicker decisions, collaborate better across the company, and enable a cost structure that allows us to continue to win in our extremely competitive industry as it evolves.

This manager action is one step along that path. Another was the decision to sell our communications and applications processor business to Marvell. We'll continue to identify other opportunities, act on each one as soon as we can, and tell you about the changes as soon as possible. I'll talk more about this and our business priorities in my employee Webcast on July 19 at 4 p.m. Pacific time.

In April I said that we had decided not to do an immediate "across the board" layoff, because that would be reactionary - focused only on the current environment rather than the long term strategic needs of our company. Instead, we chose to undertake a longer, more comprehensive project to analyze all of our operations and make strategic, data-driven decisions. That is still our plan. This manager reduction was the result of careful assessments of the management and leadership roles we need for our future success. We are in the process of fundamentally changing our behaviors and our structure for where our business and industry are going. You should expect that we will continue to take actions, including selective reductions, as we complete analyses and decisions about investments, expense levels and organizational structures. You should also keep in mind that at the end of this process we will still be the largest and most profitable semiconductor company on earth. Our actions are focused on ensuring tha

Even better

[Anonymous Coward]

I think a place I worked for a few years back discovered the optimal way to destroy yourself with layoffs. They had balloned up quickly during the dot-com days, and people who were there early got promoted and got direct reports added beneath them. So, when things started going poorly they just went in and knocked out the lowest levels, expecting that the managers could reassume the production responsibilites they used to have.

The problem was that the managers (who always outnumbered the workers to the end) really didn't understand the technology anymore and were never able to get anything done. It was an accelerating downward spiral as they swapped out all the people who made money for the company with the people that used to manage them.

could be counterproductive

[eliot1785]

For Intel's sake, I hope those managers were really not worthwhile. Because cost-cutting efforts like this can come back to bite you if it means you lose the brains of your operation in the process. Unless Intel had a thousand people sitting around who were little more than paper pushers, this will inevitably negatively impact the company's growth potential in the future. After all, sectors of the company that are "not profitable" right now might be sectors that would have become highly profitable with additional research.

(BTW, A tangential point re: the sub-thread about previous antitrust complaints about Intel, and how in retrospective they were overblown now that Intel is losing market share... you might even be able to say the same thing about Microsoft. It's been "big and bad" for 10-15 years now, but look at what is happening to its market share. Internet Explorer is losing share to Firefox, and within a year or so, OpenOffice.org will do the same thing to Microsoft Office. It might still have a monopoly on operating systems, but it will hardly be the behemoth people have always thought of it as. Intel and Microsoft are showing us that big companies can be toppled by competitive rivals more quickly now than in the past.)

Re:could be counterproductive

[eliot1785]

And before everybody jumps on me, I meant to say that Microsoft may continue to have a near-monopoly on operating systems (which I would characterize as 80% or higher share). Windows will be the last thing to go if Microsoft ever goes under.

Re:could be counterproductive

[pluther]

Windows will be the last thing to go if Microsoft ever goes under.

I don't know about that. Microsoft has a lot of products that are much better than Windows.

MS Office is still much better than OpenOffice in many ways. TeamSystem, a software development process tool that integrates version control, bug tracking, task management, and project planning, is a very well-done tool and if they'd port it to Linux it could give the Rational suite some serious competition. And Outlook, despite its many flaws, is, feature-wise, about the best email client/scheduler available.

And, of course, then there's the XBox. I've heard that some people like that, too.

Re:could be counterproductive

[Anonymous Coward]

Here is what will happen. The 1000 managers will pool their severence pay and form a competitive corporation. Their average pay is about 700,000 and they will get an average of six months for severance. This is 350,000 * 1000 = 350,000,000. Not exactally chump change. They have extensive knoledge of Intels technology and around a cubic buttload of capital to pull this off. It won't be hard at all for them to get three times this investment in venture capital.

Re:But what about the new Conroe chip?

[drinkypoo]

Specially when you factor in the non-desktop uses (e.g. cluster computing where HT links still shine).

I think you mean SMP, where HT links still shine. I have yet to see a system with external hypertransport links, although I'd love to have one :P

Dancing to the Wall St tune

[EmbeddedJanitor]

Wall St is a catwalk for business fashions. Like clothing fashions, the business fashions that drive business decision making are seldom rooted in practical thinking. If you're performing well, then you can ignore the business fashions. If you're performance is sub-stellar then you need to conform otherwise Wall St starts to get nasty. The current fashions seem to be cost reduction and focussing on core business (conservative mindsets that go with current political thinking) resulting in RIFs and dumping the PXA chips etc. Previous fashions included outsourcing/offshoring etc (so you better have mentioned outsourcing/offshoring at your investor conference calls).Next year maybe the Wall St fashion becomes hiring or diversification and Intel might just go out and buy a whole lot more businesses.

about time.

[LOTHAR, of the Hill]

This has been a long time coming. I wonder if they are still touting tiere two-in-a-box management philisophy, where you have two people managing a group instead of one. They have more project leeches there than real leeches in a swamp.

Manages Make How Much????

[mcguiver]

If laying off 1000 managers is going to save them $1billion per year I want to be a manager there. I guess this means though that either quite a few more people are going to go too or else those managers that they lay off are really underperforming and should be going anyway, no matter how the company is doing.

Re:Manages Make How Much????

[RightSaidFred99]

Ahh, reading comprehension, where art thou?

There is a 90 day effort to save Intel $1 billion. This is a _part_ of that effort.

Lemme rephrase that

[Odin_Tiger]

nd microprocessors from AMD continued to steal market share. That same

How about "AMD continued to earn market share" ?

It's the Apple curse

[Biff Stu]

Apple purchased processors from Motorola. Their processors couldn't keep up with competition. Every time Motorola had a promising new design, the processors started out like gangbusters and then went nowhere. Then Apple switched to IBM; their consumer processor efforts flopped. Now they're with Intel and look at what's happening.

Re:It's the Apple curse

[Rod Beauvex]

Wow. I can't beleive that didn't get modded as flamebait. Good show, good show!

AMD nixes GEODE too

[Sebastopol]

Apparently my submission was rejected, but AMD cut 1,000 folks too, include GEODE!

http://www.theinquirer.net/default.aspx?article=32 991

Re:AMD nixes GEODE too

[Anonymous Coward]

I haven't seen any confirmation of that rumor though.

Re:AMD nixes GEODE too

[smellsofbikes]

There's a 200-person AMD facility next door: they announced its closing yesterday. 100 people laid off (in November) and some fraction of the remainder moved to another facility, the remainder laid off when the facility closes its doors some time early next year. It's nice that they gave them that much time, but it was still a shock. I believe they were doing work on Celeron stuff.

This should improve profitability

[ElectricRook]

less managers will probably allow their employees to actually get some work done

In some cases, that's right. My last manager practiced the BDOS attack (Boss Denial of Service). Where every 15 minutes, he would ask me the status of project [X, Y, Z]. This occured when I was using the debugger and stepping through my foobar PERL program. I had all the variables and contexts loaded in my head, and PHB would jump in for the next round of BDOS attack... Needless to say, my brain does not do cache hits very well. Massive core dump, my face probably had the expression of a SPED (special ed) for a few minutes. I'd have to re-group to even think about what projects were in work. Then I could look up the log files, and check on the progress. Needless to say, I then re-started the debugging from the beginning again. After 15 minutes, PHB started up the next round of BDOS, again ElectricRook does the core-dump.

I always made great progress when I'd order a pizza, and stay late debugging.

Yes, I work for Intel.

Re:This should improve profitability

[Anonymous Coward]

Just put up a sign by your cube that says "Quite Please! Trying to sleep here!". Failing that, a child-proof gate at the edge of your cube would probably confuse your boss enough to make him leave you alone.

Re:This should improve profitability

[ElectricRook]

I employ the "Child Proof Gate" idea. I have a shared cube called a "Bull Pen". My cow-orker and I share the doorway, and we get to sit facing the front. For the gate, we hang coat hooks in each side of the doorway, and keep bulky jackets there.

Two in a box

[Anonymous Coward]

Bear in mind that the whole "two in a box" management strategy is prevelant within Intel.
In some cases one of the pair are being removed, so it shan't make as much impact to the business as some might expect.

Actually it's REALLY smart

[WebCowboy]

Because it's always better to start doing something before you finish understanding everything, than waiting till the end when you can make changes based on an accurate understanding of the entire process.

Translation: Responsive, strategic action is always better than "Analysis Paralysis".

"Waiting until the end when you can make changes based on accurate understanding of the entire process" can be risky, becasue while you are busy navel-gazing the competition is actually DOING something. Also, the process is never completely static, and if you sit and analyse for too long your previous analyses become obsolete.

Oftentimes the best time to "start doing something" is when you have ENOUGH information--not ALL the information. If that wasn't the case then Agile software development wouldn't be so popular, for example. Although it is unwise to make rash decisions, Intel cannot afford to muck around analysing the entire corporate structure in detail before taking any action--it has already moved from monopolist to threatened market leader and if it keeps drifting it'll be a has-been also-ran.

Yee-haw!

[StikyPad]

He said he planned to make changes as his analysis progressed, rather than waiting until the end of his review.

Good idea.. Having a "complete picture" is overrated anyway. George W. would be proud.

netburst?

[mseidl]

I don't like to see people getting laid off, especially when the company is still seeing billion dollar profits.

But... Start laying off all the people incharge of keeping Neburst around for as long as they did. They are single handedly resonsible for global warming!

Re:netburst?

[postmortem]

NetBurst came from top - marketing decision to fool the customer into buying GHz number only, regardless of consumption and efficiency. No way that such "lucid" idea would come from designers; they were simply forced to implement it.

How many of these jobs

[rsilvergun]

will be in well paying, first world countries? All of them? Probably. I remember a qoute from the CEO of Intel in an article on the shrinking tech market; only the market wasn't shrinking for him, he was busy expanding into 2nd and 3rd world countries.

Good

[bingo_cannon]

Now we may see something better soming out of Intel!

Competition

[Anonymous Coward]

Bah! Everyone wants a HT Intel processor. But not at those ridiculous prices. Lower them prices and just watch AMD sweat.

recruits

[zxcvb2468ed]

I think there are way too many engineers or manager that dont make the cut. I know a lot of graduates in CS who have made to the positions/internships at Intel just because there spouse/brother works there. With there struggling education averages and no specific skills or merits, I was suprised they still made it. Seems like internal contacts are more important at Intel than educational merits, experience or skills. I will not be suprised to see more inefficient people being layed-off as cost-cutting measure.

Re:recruits

[Anonymous Coward]

This is not a suprise. If memory serves, for each referral that got hired, you can get like 2k per head. If you refer like women, minorities (excluding Asians and Indians) then you can get 3800 bucks!

I know an Intel manager that made over 10K because he was able to recruit some women.

solid approach to business - what's wrong?

[edis]

Support goes to intel today - even, if we love catchers-up, it takes two for perfect market games. Then, if intel feels in bad position this evening - let's wish them strength to carry on. They DO deliver, there's no doubt about it. As does AMD, we need two, both are much appreciated...

Oh my god!

[Anonymous Coward]

Oh my god! 1,000 pointy-haired managers roaming the streets of San Jose!

not like managers do much anyway

[Anonymous Coward]

good to see them starting somewhere in the middle instead of at the bottom, where tha actual work is done.

but who will make sure the TPS reports get filed?

The wisdom of elders

[Anonymous Brave Guy]

I am reminded of an anecdote my father once told me, about the management policy in a large company where he worked.

One day, the management decided to call in the management consultants. In due course, a snappily-dressed 24-year-old strolled into the office where my father worked as leader of a team who were, essentially, the world's experts in their particular area of R&D.

My father is not a man who suffers fools gladly, and after the introductions, asked the 24-year-old in his tailored suit what he could offer by way of background, to help him guide a man with 20 years' experience in the industry to perform better.

"I have a degree," said the 24-year-old.

"That's interesting," said my father. "So do I."

"Mine's from Oxford," said the 24-year-old.

You can imagine the reaction...

Re:The wisdom of elders

[Anonymous Coward]

So your father was an Oxfordian as well?

(just kidding..)

IANAIM-"/." karma.

[Anonymous Coward]

"Some don't, but I have firsthand knowledge that those folks aren't the only ones losing their jobs this month."

I'm certain slashdot's "dancing on your graves" must rankle just a bit.

"Yes, the numbers don't add up to 1000--managers at Intel tend to wear a ton of hats, put in a ton of unpaid overtime, and go the extra mile."

As salaried employees that's a manager's lot in life. You make more (but not always as much as people think) and you have to be the last one to turn out the lights. At least hourlies are home in bed.

Re:IANAIM-"/." karma.

[Anonymous Coward]

That's the lot in life for all Intel blue badge employees, manager or no. Nobody's in bed, unless they're snuggling there with their work laptop.

I absolutely agree, based on my familiarity with some of the managers who are being let go, that Intel is losing many, many valuable workers -- very prolific and high-quality people -- who happen to have the title "Manager".

Why the musical theme?

[mangu]

Viola! Org chart foldin!

What does organization charts have to do with music?

Or did you mean voila ?

Managers? Laid off? Impossible!

[Opportunist]

C'mon, no company gets rid off its managers! They only fire the useless techs. At least so far that's the only development I've seen recently in companies. Techs are fired, replaced by leased personnel, and a bunch more managers are hired to shuffle the leases around.

Don't tell me Intel finally realized that managers produce nothing but paper and you can't sell that. Don't destroy the picture I have of the corporate world.

Or are there no workers left to be fired?

Re:Managers? Laid off? Impossible!

[Anonymous Coward]

I used to work at Intel in manufacturing (i.e. the bottom), though I don't anymore. My experience there was that manufacturing was just barely adequately staffed most of the time, engineering was appropriately staffed, and there were far too many people in middle management, marketing, and most of the other paper-pushing areas. Recent nonsense coming out of Intel basically reflects this: who would ever come up with stuff like "Viiv" (which nobody, even at Intel, can seem to define) if they were busy doing work?

Intel's corporate culture has always been pretty healthy in my opinion; I don't doubt that they'll do their best to cut the truly unessential people and not bother the important/understaffed areas too much. Not all corporations are run by people willing to run the company into the ground to make themselves money.

Re:But what about the new Conroe chip?

[Anonymous Coward]

Let's see.. if you are going to build a 1000 cpu cluster, would you rather have a) 1000 motherboards/powers/etc or b) 250 of them?

What do you call...

[IceFoot]

... 1,000 laid-off managers?

A good start.

Re:But what about the new Conroe chip?

[tomstdenis]

With HT switching you can easily have 100s, 1000s of processors on one topology. the other "nodes" are simply off a switch which then takes on the responsibility of knowing where memory is. That and HT is an open standard. Your northbridge controller is connected via HT.

There is nothing in the consumer market that exploits connectivity on the HT side but that doesn't mean it doesn't exist in custom shops and labs.

Tom

Timing probably more related to...

[PXE Geek]

the earnings report scheduled for next week.

Intel tells Congress they need more H-1B visas

[Anonymous Coward]

Why then, is Intel lobbying Congress for more H-1B visas, and claiming a "skills shortage", when they are laying off this many employees?

Crack/Heroine mix??

[Svartalf]

Is that anything like a Crack Ho?

Intel?

[Shadyman]

I, for one, welcome our new AMD overlords.

Look at Management Consulting firms

[Anonymous Coward]

Management Consulting firms typically fire their bottom performers every year. It's just a competitive industry so it's expected.

Re:Look at Management Consulting firms

[Grishnakh]

Yeah, but as I pointed out before, I don't think this is good for morale, at least in an company dominated by engineers. Maybe it works for management consultants, because as you say, it's a competitive industry and it's expected, but in my years I've never known engineers as a general group to care much for the idea of such cutthroat behavior at a company. Rather, they pine for the days when employment in engineering was extremely stable. I know I (a EE) certainly prefer stable, 9-5 employment to the kind of sporadic and long-hours employment that other professions have. If I wanted a job like that, I wouldn't have sought out full-time employment as an engineer.

Top managers benefit even if they destroy the Co.

[Futurepower(R)]

There is a general understanding that Paul Otellini, the CEO of Intel, is not doing his job well. He has, employees say, intensified the culture of adversarial behavior at Intel.

Intel has made some serious technical mistakes over the years, too. But the people who suffer from the lack of technical knowledge of top management are the workers, not the top managers. It has been established in the U.S. that top managers almost always benefit, even if they destroy the company.

There is another issue. After you have an Intel Pentium IV or AMD Thunderbird computer, you don't need another. In the past, people who owned Intel 8086 computers wanted to upgrade to 286 computers. Those who had 286 computers wanted to upgrade to 386s, then to 486s, then to Pentium I, II, III, and IV computers. But Thunderbird or Pentium IV computers do everything most people want.

I got fired JUST in time!

[Anonymous Coward]

I was "asked to pursue my career elsewhere" in March.

In April, Otellini starts the Inquisition.

And now the heads are rolling.

I got out just in time!

Re:Top managers benefit even if they destroy the C

[Anonymous Coward]

Thank God for Vista then.

Intel: Technologist - Manufacturer

[gnetwerker]

This is, as other have observed, long overdue. While Intel could maintain a dominant market share, and thus pricing power over its competition (primarily AMD), it could afford to (attempt to) be a broad-based technology company: i.e. one that invested heavily in new technologies and speculative businesses that were not necessarily on a direct path to their primary (semiconductor) products. The largest (and most wasteful) of these investments happened during Craig Barrett's regime as CEO, and it was these that were most desperate and ill-advised. These included Intel's $500m+ investment in trying to be a hosting service, its attempts to be a toy manufacturer, a maker of DLP-TV chips, and numerous other misbegotten adventures.

What Intel is at heart, and will be for some time, is the world's best manufacturer of semiconductors. And this requires a far, far lower load of white-collar workers than a putative technology company. Intel can be a great producer of an important product, but only in the sense that (e.g.) US Steel was once a great producer of an important product. Intel is on the path to irrelevance as a technology force.

Re:Intel: Technologist - Manufacturer

[Anonymous Coward]

This is, as other have observed, long overdue. A hard look at how Intel spends its resources, yes, that's overdue. And management structures are part of the story, but hardly the most important. Let me offer you an alternative target (knowing that it is also not the only major issue): How is it possible for a platform company--that must forecast new business models, markets, value propositions, and usages as integral aspects of value delivered and deployed--do so successfully when the design cycle for silicon typically ranges to four years (or more) using hundreds of engineers. Microprocessor design at Intel is considered to be "world class". This "success", largely due to manufacturing economics, masks the fact that the design and engineering processes are not as mature as other engineering disciplines. Intel can easily afford management inefficiencies if this issue is addressed. Unfortunately, a different kind of management problem is behind this issue... really a symptom of something much more fundamental. While Intel could maintain a dominant market share, and thus pricing power over its competition (primarily AMD), Sorry, bub. AMD isn't the competition. You might want to look at companies like Samsung. it could afford to (attempt to) be a broad-based technology company: i.e. one that invested heavily in new technologies and speculative businesses that were not necessarily on a direct path to their primary (semiconductor) products. The largest (and most wasteful) of these investments happened during Craig Barrett's regime as CEO, and it was these that were most desperate and ill-advised. These included Intel's $500m+ investment in trying to be a hosting service, its attempts to be a toy manufacturer, a maker of DLP-TV chips, and numerous other misbegotten adventures. Please, do you research. I won't argue the "hosting service" as a venture that might not have been a great idea in production, although the term you use isn't accurate. But the Smart Toy Lab was a radical success at what it set out to do, and the intent was never to be a high-margin business. It was a LAB, for chrissakes! Meant to demonstrate how Intel silicon and PCs could be extended beyond established usages, to help promote Intel's agenda in bolstering education, and as a tool that was worth its weight in gold in marketing ROI. Do you actually think Intel meant to make silicon-level margins in the TOY BUSINESS?! And the LCoS efforts (not DLP, thanks) ran into issues... including competing for fab capacity when there was also a shortage of chipsets due to bad planning and strategy. There were others, but this was the show-stopper, not the viability of LCoS as a core silicon business. What Intel is at heart, and will be for some time, is the world's best manufacturer of semiconductors. Yes, but manufacturing is quickly becoming "not enough". That's behind the transition to becoming (intentionally) a platform company. Manufacturing will not be a competitive advantage for a whole lot longer. And this requires a far, far lower load of white-collar workers than a putative technology company. Intel can be a great producer of an important product, but only in the sense that (e.g.) US Steel was once a great producer of an important product. Intel is on the path to irrelevance as a technology force. Sorry, I can't really offer a coherent counter to this one. You've really missed the mark in terms of a viable analogy. Thanks for playing.

Re:Intel: Technologist - Manufacturer

[gnetwerker]

I don't normally reply to ACs, and this is old news, but for the record, you don't know what you're talking about.

To your comment "Sorry, bub. AMD isn't the competition", from the 7/21/06 New York Times:

The Intel Corporation, the semiconductor maker, said yesterday that it had shuffled its management team as part of an effort to speed up decision making and win back market share from Advanced Micro Devices.

Your other commentary is similarly ill-advised.

Congratulations for getting a job as a junior engineer at a formerly great company, but don't plan on retiring on your stock options.

there goes Itanic!

[swschrad]

glub, glub. one move will improve Intel's profitability immensely. HP needs Itanic, they can buy their people back.

Come on ACs, climb from under your rock!

[mangu]

a troll giveaway by him

A "troll giveaway" is what you and your parent post have shown. If you know anything at all about computers, you will know that, for integer operations, any CPU made in the last ten years is heavily overdesigned. Name one single application that overtaxes a modern CPU in integer operations. Do you think MS-Word is slow because the CPU cannot do enough context switches? How come those measly CPUs in palmtops can perform as well as Pentiums or Athlons for those jobs they do?

The one task where CPUs can still be improved by orders of magnitude is in number crunching. When AMD presented CPUs with half the number crunching capacity of Pentiums and still claimed they where superior, that was an act of wrongful advertising.

Re:Come on ACs, climb from under your rock!

[ppanon]

I expect that 90% of non-scientific and non-gaming computing these days is probably still integer based. Nearly all business computing is (word processing, spreadsheet, financial, CIS, web stores). A huge proportion of personal use is the same as well (e-mail, web browsing).

AMD processors now support SSE2 and are quite competitive with Intel x86-based processors on the small (yet increasing) application market segments which use floating point (audio, video manipulation, etc).

So you weren't educated enough to look at a processor's performance on the range of applications you wanted to use it for prior to your purchase, even though that's been accepted practice in that sector for, oh, at least 20 years. If you want to repeat and compound your error to pay an Intel premium for the same amount of performance you would get from AMD processor, that's your choice.

Intel likes marks - er I mean customers - like you.

Re:IANAIM (but my friend is)

[gosand]

I can not count the number of managers that have two or three people reporting to them. There are^H^H^Hwere managers who have never worked in the field they manage.

My friend works at Intel, as a manager. He has only been in that position for 6 months or so, and he did do the work in the field. He has been saying for a while that they have too many managers. He told me he completely agreed with what they were doing, and has been saying it should be done for a long time. I guess they did a lot of research on it too (surprise surprise) and decided what the optimal number of people each manager should have, what the structure should look like, etc. He has six people reporting to him, but two other managers in his group have 4 each. He obviously hopes he doesn't lose his job, he has been there 10 years. He has always spoken highly of how the company has treated him.

Oddly enough, the reason we were talking about all this coincided with my applying for a job at Intel (yesterday) and using him as a referral. I lost my job at a small company 3 days ago, and I was a manager but still doing a lot of technical stuff. What is weird is that they replaced me with someone who was purely a manager, no technical skills at all. Strange, the ebb and flow of large/small companies in the technology sector.

(It's been a weird week - my brother lost his job last week, and my mother-in-law lost hers today. All different fields, in different parts of the country.)

Re:Top managers benefit even if they destroy the C

[Anonymous Coward]

my thoughts exactly.

Bad Move, They should fire engineers

[Anonymous Coward]

IMHO, American managers are the best. I have worked under an American, Chinese, Briton and an Indian. American was the best for my career growth as well for the project. Indian manager was the worst. However, I have noticed that Indian engineers are better and very competitive. So Intel should keep their managers and move some engineering jobs to China and India.

Re:Bad Move, They should fire engineers

[Liveandletlive]

Without generalising that Indian managers are bad, would you care to give us some insight into your experiences?

Good Lord, finally, a CEO with brains!

[melted]

Microsoft needs to replace SteveB with this dude. Hierarchies of management have grown to enormous depths at MSFT. No wonder folks on top have no idea when Vista will ship - it's a broken telephone game. And folks on the bottom can't make any decisions since they have no authority. And technical details get lost one level above the grunts who work in the trenches. So by the time anything reaches a VP (Microsoft currently has something like 120 VPs!), it's screwed up several times. And VP doesn't know shit about tech, he makes decisions which benefit him career wise.

Bravo, Intel. I think it's time to buy Intel stock.

the easy way to do it

[maxpublic]

If Intel wants to get rid of the sub-standard dead weight it's managed to accumulate over the years, all they need to do is ask their employees to spell the word "lose". Those who spell it "loose" are the obviously morons and can be shit-canned right on the spot; in fact, getting rid of these idiots will probably improve the performance of the company dramatically.

Max

Re:the easy way to do it

[Anonymous Coward]

If Intel wants to get rid of the sub-standard dead weight it's managed to accumulate over the years, all they need to do is ask their employees to spell the word "lose". Those who spell it "loose" are the obviously morons and can be shit-canned right on the spot; in fact, getting rid of these idiots will probably improve the performance of the company dramatically.

Definately!

(It's a joke, damn it, a joke!)

Re:Top managers benefit even if they destroy the C

[Cocoshimmy]

I think you're assuming that software requirements will remain the same this point forward as will the tasks performed by most at their computer.

Many people who bought Pentium II, III, and now IV processors, at the time thought that their computer would be able to do everything for them.

But always, over time, software requirements changed and people's demands had changed.

Over time, software needed more RAM, more PROCESSING power, 3D acceleration, increased networking capability, DVD playback, etc. The list continues.

Right now you may be able to surf the web, play a few games, check your mail, etc. But wait until Vista comes out and Microsoft drops support for XP (as will hardware vendors at some point). Suddenly the minimum system requirements skyrocket and even the new requirements are not sufficient to perform simple tasks quickly. Wait until new games will only run under Vista and will require a DX10 video card. Not only that, in order to get a DX10 video card you might need a new mobo and CPU, one with PCIExpress or some other next generation peripheral bus. Want to play hi-def video content on your machine? You'll probably need a faster processor and/or faster video card to decode the DRMed content.

Also, this is just how things are going to effect normal home PC users. Hardcore gamers, engineers, software developers, scientists, server admins, mathemeticians, movie makers, etc, are constantly demanding more in terms of processing power and features.

People may not necessarily want to upgrade immediately after dropping $1000+ for a new computer, but most will eventually feel the need to upgrade as they always have in the past. Even Linux users who won't necessarily need to upgrade to Vista, will probably upgrade their hardware to support new software and technologies.

Yee-who?

[Anonymous Coward]

StikyPad wrote: Good idea.. Having a "complete picture" is overrated anyway. George W. would be proud.

StikyPad might be interested to read this:

STATEMENT BY THE PRESIDENT

Today I am signing into law H.R. 4655, the "Iraq Liberation Act of 1998." This Act makes clear that it is the sense of the Congress that the United States should support those elements of the Iraqi opposition that advocate a very different future for Iraq than the bitter reality of internal repression and external aggression that the current regime in Baghdad now offers.

Let me be clear on what the U.S. objectives are: The United States wants Iraq to rejoin the family of nations as a freedom-loving and law-abiding member. This is in our interest and that of our allies within the region.

The United States favors an Iraq that offers its people freedom at home. I categorically reject arguments that this is unattainable due to Iraq's history or its ethnic or sectarian make-up. Iraqis deserve and desire freedom like everyone else. The United States looks forward to a democratically supported regime that would permit us to enter into a dialogue leading to the reintegration of Iraq into normal international life.

My Administration has pursued, and will continue to pursue, these objectives through active application of all relevant United Nations Security Council resolutions. The evidence is overwhelming that such changes will not happen under the current Iraq leadership.

In the meantime, while the United States continues to look to the Security Council's efforts to keep the current regime's behavior in check, we look forward to new leadership in Iraq that has the support of the Iraqi people. The United States is providing support to opposition groups from all sectors of the Iraqi community that could lead to a popularly supported government. ....

The Iraq Liberation Act of 1998 provides additional, discretionary authorities under which my Administration can act to further the objectives I outlined above. There are, of course, other important elements of U.S. policy. These include the maintenance of U.N. Security Council support efforts to eliminate Iraq's weapons and missile programs and economic sanctions that continue to deny the regime the means to reconstitute those threats to international peace and security. United States support for the Iraqi opposition will be carried out consistent with those policy objectives as well. Similarly, U.S. support must be attuned to what the opposition can effectively make use of as it develops over time. With those observations, I sign H.R. 4655 into law.

WILLIAM J. CLINTON

THE WHITE HOUSE,

October 31, 1998.

Romulans?

[StarkRG]

I hope I'm not the only person who, at first glance, thought he said Romulans...

Subject

[Legion303]

Wait, they're laying off management instead of the grunts who actually make the products? Shit, they must be desperate.

AMD is taking their competition too seriously...

[Anonymous Coward]

...by trying to match Intel's layoffs!

If Intel were crafty, they'd figure out how many people work at AMD, and lay off that many.

Vista is an attempt to create a need...

[Futurepower(R)]

Vista is an attempt to create a need for people to buy new computers. What do YOU say? Will you buy a new computer? Will you run Vista?

They now know your Intel insider relative's ID

[GringoGoiano]

Companies sending out corporation-wide e-mails with sensitive information often
"stamp" the content with a unique ID for each copy they send to each individual
employee. They compare any leaks with the original text sent to each employee
and then identify the leaker. This could be bad news.

For an example, let's say there is one CEO and 4 grunts in a company.

An example e-mail template:

Dear Employees,

You'll remember {0=[],1=[that]} at last Tuesday's lunch outing a few of you
didn't have cash on hand to pay for your {0=[chicken & waffles],1=[waffles & chicken]}
lunch. I floated loans that are still not repaid. Forget you all, you pay for your
own lunch from now on.

The CEO

There are four employees, the CEO sends employee #0 with the e-mail template '00',
the next '01', ... so on till '11'.

If the CEO finds someone anonymously leaks a complained on a web site
about how stingy he is, citing the full e-mail, he knows which of the
four leaked the e-mail.

Re:They now know your Intel insider relative's ID

[Anonymous Coward]

I can't imagine this being used beyond a low number of recipients.

Can you elaborate about how you think this sort of thing would scale?

Re:They now know your Intel insider relative's ID

[jon_c]

This is really simple. You'll notice that each replaced phase was a 0 or 1 -- a bit. So to scale to 256 you only need 8 (2^8)of those option phrases, or to 65536 16 (2^16) phrases. Such would be easy in an email the length that was posted.

Private companies the way to go.

[Anonymous Coward]

In my experience Ive found it far more rewarding and "stable" to get a job with a good private company. If you work for a big company whose value is judged on stock performance you will face layoffs in regular cycles. Even if the company actually profits it doesnt matter because it incresed earning dhareholders expect and every company has waves in earnings.

I would never want to work for Intel, IBM etc.

re: reassignment of jobs

[King_TJ]

Huh? I think *you* must be a bit naive if you think "middle management" is responsible for everything from developing packaging for products to sales to payroll and benefits!

You have accounting staff, a maintenance department, a human resources department, a sales department, and possibly a marketing or advertising department for such things.

The people being cut in this Intel move are going to basically be your "project managers", who do little but act as mouthpieces or "conduits" between a small group and another manager above them who expects/wants to deal with only 1 person when giving orders or requesting feedback on a particular project.

IMHO, that's really just a "luxury" for larger companies. If it's time to cut costs, that's the best place to start. Smaller businesses can't afford to do such things, so one manager is typically expected to listen to and work with a group him/herself, and consolidate their individual statements into one "summarized" version to give to the business owner(s) when needed.

Re:Wow! I want to work for Intel!

[Weaselmancer]

Its scary just how much over the salary someone costs.

Apparently the world agrees with you. I thought my post was teh funny, but *damn* did I get downmodded hard.

Ah well. Sometimes you get some seriously grouchy modding here. =)

Lot's of replies :) all 1 responce

[tinkerghost]

The part of the original was:

Chief Executive Paul Otellini vowed to spend the next 90 days identifying underperforming business groups and cost inefficiencies in an effort to save the company $1 billion a year. He said he planned to make changes as his analysis progressed, rather than waiting until the end of his review.

Now my problem is that I have worked in large multi-division companies, when someone does an 'analysis' they start looking at numbers from either the top down or the bottom up. If he's going to take 90 days to map & evaluate every department in Intel, and make changes as his analysis progresses, what happens when he hits that first 'bad' set of numbers? Chances are, he's going to start making changes right there --- the problem is, he has only discovered a problem, he may or may not have found the cause.
From WebCowboy:

Translation: Responsive, strategic action is always better than "Analysis Paralysis".

From Odin_Tiger:

So...you're on a boat. It's slowly sinking. You begin to analyze the situation, and you discover what appears to be a large hole below the water line, which is taking on water at a pretty high rate. Do you: A) Plug the hole as fast as you can, or B) Make note of it, and any other holes you may find, but simply continue your analysis until you are sure you know everything there is (or was, before it sank) to know about the ship?

And from King_TJ:

I'm well aware that some of our management are worthless sponges, sucking up a paycheck while adding zero value to the company. I plan on kicking these people out as soon as I can, while looking at the rest of the bunch to see who else needs to stay, and who needs to go.

For Webbie: Only if your strategic action is, in fact, a correction to a cause of a problem. Removing Bob as manager from the FUD dept for poor results, doesn't solve the problem if Alice insists on telling the truth all the time & Bob is documenting things so he can fire her next week.

More in keeping with Intel, if you examine chip production from the bottom up:

1. Shipping - organized & ready to go when ship dates come 90%
2. Packaging - designed & orders placed - waiting on delivery 90%
3. Production - Achieve production goals 90% & retooling time down 10%
4. Marketing - Always perfect - ask them
5. Integration - 30% behind schedule and still working to get NSA Backdoor to work with the Integrated Trust Shafter.

Running through here, you have an obvious problem with the Integration department. From a perspective of raw productivity numbers, something has to change in the Integration dept. Having tweeked Integration we move on and find:

• NSA Backdoor - finished design specifications 20% behind, Interface specs 30% behind, and prototype 40% behind.
• Integrated Trust Shafter - delivered Interface Specs 15% ahead, but prototype 30% behind.

Oops, we just tweeked Integration, but the problem was really the NSA Backdoor and ITS depts.

Intel is moderatly huge w/ 90,000 Employees. I don't think it's unreasonable to think that there are at least 450 departments [number chosen for easy numbers w/ 90 days] in the whole company. At that rate - they are going to average 5 depts a day (450/90). At that rate they are going to be looking at numbers and not causal relationships.

For Odin, looking at the production example, it doesn't do me any net gain to patch the hole in the bottom of the boat if I don't pay enough attention to notice that Alice has a shotgun & is trying to kill the minnow in the bottom of the boat with it.

For King, you may be correct, if they have been looking at pruning the management tree for a while, but the wording in the artical pushed me to the understanding that this was a dept based cleanup not an individual one.

No, what I see coming is a vast CYA-fest with chaos to follow.

Professor Farnsworth said it best

[KIFulgore]

The Jedi are gonna feel this one.

Clearing the forest

[ColonelPanic]

And the real disastrous employees, well, don't worry about them; you don't need reviews to find them, and rarely an excuse to get rid of them. Just wait until the police, fire department or the CDC has identified the idiot who caused the whole mess and get rid of them.

Too simplistic. Organizations accumulate deadwood that must occasionally be cleared out, or progress will grind to a halt.

In my organization, I wish we could give a freshman-level C programming class final exam to everybody whose job requires proficiency in C programming.

Re:Clearing the forest

[Richard Steiner]

Unfortunately, most of the places I've seen layoffs occur use the following criteria:

(1) Tenure. Junior people get axed, senior people stay.
(2) Project. Folks working on noncritical projects get axed, folks working on critical projects stay.

Neither method takes into account individual performance.

English is great. Learn it.

[ColonelPanic]

I think you mean "hear, hear!", an abbreviation for the old cry "Hear him, hear him!".

As punishment, I'm taking away all the spare apostrophes and lower-case 'o's that you probably like to stick into words like "its" and "lose".

And yes, I'm having a bitchy day and I'm taking it out on you. But you wouldn't believe the illiteracy levels I'm seeing in my corporate e-mail inbox lately. When did third-grade composition skills suddenly become optional?

Re:English is great. Learn it.

[Surt]

English is not a dead language, get comfortable with it. :-)

You are a moron.

[Anonymous Coward]

Carly wasn't a retard just for wanting to buy compaq (which was a bad move, and massive waste of money). She was a retard who fucked over HP completely by trying to BE compaq. She completely removed the entire R&D and engineering aspects of the company, shit-canned their only worthwhile products, and tried to turn the place into an even shittier dell. Just like compaq had done. Look how well that worked for them. HP is starting to recover a litle from the horrible impact of Carly, because they got rid of her and tried to undue some of the damage.

Intel layoffs

[Anonymous Coward]

I retired from Intel not long ago, so am all too familiar with the internal realities. Truth is, to return Intel to health, the company would have to do the following: (1) fire the rest of the managers, with a handful of exceptions, (2) wrest control of the company from the sales-and-marketing cadre and return it to the technologists, (3) eliminate at least 45 of the 46 Vice Presidents, (4) start treating employees like human beings instead of toilet paper, (5) stop suppressing internal dissent and instead encourage it, (6) toss out the gulag-inspired ranking-and-rating system, (6) have Craig Barrett publicly apologize, on his knees, for what he has done to a once-great company. Intel is a victim of its own hubris and self-delusion. Time for humility, time for truth, time for sackcloth and ashes, time to dump the entire applecart upside down. Chances for this actually happening? About the same as Fidel Castro swapping his faded army cap for a Mickey Mouse beanie.