TECHNOLOGY MEETS REALITY
Well folks, don’t say I didn’t warn you. Just when you thought technology would somehow escape the big black recession hole that has been consuming people, jobs, business and investments, came the first Tech wave of troubling news.
Microsoft is talking louder on expense cuts, including layoffs. The software giant will not be selling as many software licenses to computer makers and businesses will skip an upgrade to a new OS or back-Office system. Nortel officially fizzled to penny stock and Circuit City is closing its doors in the U.S., letting go of 30,000 workers.
Google is laying off 100 folks, which for a company of that size, is small change….but these 100 employees were recruiters!
Technology companies work on a different timeline than brick and mortar businesses. A furniture store for example, feels the pinch the same month consumers are spending less. So would, as we all know by now, car makers.
But technology produces stuff anywhere from six months to a year in advance, under earlier approved budgets and expectations.
The next few months will show the end of that previously healthy cycle and the beginning of today’s economic reality that people cutting back on technology, from enterprise to consumers, will not spend like the last cycle.
That means the chip makers, computer makers and IT business are realizing they won’t be selling as much this next year.
Warehouses are filling up with an overflow of electronic goods from TVs to stereos, DVD and Blu ray players and computers. And there is a wave of new consumer models coming this way in the spring.
Hang on to your keyboards folks cause there will be more tech companies making bad news in the next few months.