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Intel to Lay Off Thousands 266

Posted by CmdrTaco
from the well-thats-not-so-good-for-them-then-is-it dept.
symbolset writes to say that "Intel is expecting to lay off 10% of their workforce in a move to become more competitive against rival AMD. From the article: 'The Santa Clara, Calif.-based chipmaker, having suffered several financially disappointing quarters, launched an internal analysis in April to find ways to increase its efficiency. [CEO Paul] Otellini is scheduled to announce the results of the analysis, including the layoff, on Tuesday after the stock market closes, sources familiar with the plans said. Intel has about 100,000 employees worldwide, so the cut could be as high as 10 percent of the company's staff.' Coverage also at The Register, internetnews.com, and more as it develops at Google News. Reuters has the number at up to 16,000."
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Intel to Lay Off Thousands

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  • by mgblst (80109) on Friday September 01, 2006 @09:51AM (#16023611) Homepage
    I think Intel has more class than some other companies.

    But this is still a huge number of people to get rid off. Don't they do these sort of checks all the time, on a department basis. This sound more like a simple reaction to we can't do anything better, so we will fire people. A bad solution to a problem if you ask me.
    • by sjwaste (780063) on Friday September 01, 2006 @09:59AM (#16023649)
      A bad solution to a problem if you ask me.

      Close, but not quite. When they had less competition, they probably just threw people at problems their current staff couldn't solve. Now that there's competition, they have to cut back. The simple reaction you talk about was probably needlessly throwing people at problems in the past.
      • Re: (Score:3, Insightful)

        by Richard Steiner (1585)
        They've had competition of a serious nature for several years now at least. That (by itself) doesn't seem to justify the layoffs.
        • by Junky191 (549088)
          Not really. It's only in the past 12 months that market share and earnings have really changed. AMD wasn't able to translate the superior performance and power efficiency of Athlon 64 & Opteron into actualy stolen market share for a couple eyars. Of course it's all irrelevant since Conroe/Merom/Woodcrest is a huge leap over anything else either company offers, will easily ramp up to 5Ghz in a couple years, and since AMD has absolutlely nothing competitive on the horizon or beyond the horizon.
        • by Jahz (831343) on Friday September 01, 2006 @11:38AM (#16024370) Homepage Journal
          They've had competition of a serious nature for several years now at least. That (by itself) doesn't seem to justify the layoffs.

          Of course not, but who said that was the only reason? Intel may have had competition from AMD for a while, but Intel are just now starting to take that seriously. Intel hung on to the P4 - against a constant AMD barrage - for a really long time. But in the past year AMD has beaten Intel to the affordable 64-bit chips, affordable dual-core chips, affordable enterprise-class server chips (opteron), and affordable preformance chips (overclockers, gamers).

          I will admit that the last 4 computers I have built for myself wore a sticker that read "AMD Inside." Most recently, in Feb of this year, I constructed a PC that ran a dual core AMD Opteron processor (165). On the first boot I cranked the core speed from 1.8ghz to 2.5ghz and its been running smoothly ever since. Thats a great chip, and it only cost $2xx USD, whereas the equivalent P4 at the time was near 850-1000 USD.

          I will also say that I am extremely pleased with Intel lately. The archetecture of the "Core" line of processors is really cool. They are fast, dual-core, and low power. To me, this symbolizes the first REAL response to AMD by Intel.

          I have spoken to people who worked as engineers at Intel. Some of the projects were really cool, but most never made it out of the labratory. Intel is an R&D firm... they do great research. I hope the layoffs don't really affect that part of the company.
    • by hiroller (994761) <dvan_cuyk.hotmail@com> on Friday September 01, 2006 @10:00AM (#16023656)

      It seems like a knee-jerk reaction to me. They're losing money and they don't want to scare off the investors. Easiest way to do that is to reduce the money flowing out of the company which usually means layoffs. Less salaries gives the appearance of more profit margins

      Everytime, I hear of layoffs though I always think of Office Space

      Peter Gibbons: You're gonna lay off Samir and Michael?
      Bob Slydell: Oh yeah, we're bring in some entry-level graduates, farm some work out to Singapore, that's the usual deal.
      Bob Porter: Standard operating procedure.
      Peter Gibbons: Do they know this yet?
      Bob Slydell: No. No, of course not. We find it's always better to fire people on a Friday. Studies have statistically shown that there's less chance of an incident if you do it at the end of the week.
      http://www.imdb.com/title/tt0151804/quotes [imdb.com]
      • Re: (Score:3, Insightful)

        by rcamera (517595)
        this guy, against all historical data, claims that intel is losing money. and for this, he is modded insightful. look at the earnings history for the past 4 quarters [yahoo.com] and tell me if they're really losing money. i will agree that they're making less on a year-to-year basis, but they are still far from losing.
        • Re: (Score:3, Interesting)

          by GreyPoopon (411036)
          this guy, against all historical data, claims that intel is losing money.
          That depends on your definition of losing. If they fail to capitalize on an opportunity for profits, that could be considered "losing". For my part, I feel that any company that goes through layoffs as a response to eroding market share is plotting a course towards either bankruptcy or being bought by a competitor.
    • by RetlawST (997563) on Friday September 01, 2006 @10:03AM (#16023680)
      I've never been a fan of mass layoffs, but we don't know how long this has been in the making. Hopefully Intel has audited well and doesn't end up severing it's own foot in order to escape from the trap. I feel bad for the employees, but layoffs are going to happen at a large company when things start going south. Hopefully Intel is classy and gives them enough time to find new jobs/promise to rehire if things get better.
      • Re: (Score:2, Interesting)

        by Anonymous Coward
        i worked there in 2002 as an intern and they did a 4000-person layoff. I remember people were getting 4 months severance pay or something like that. Sounded like a good deal to me.
        • Re: (Score:3, Insightful)

          by eggoeater (704775)

          i worked there in 2002 as an intern and they did a 4000-person layoff. I remember people were getting 4 months severance pay or something like that. Sounded like a good deal to me.

          I would have thought it was a great deal too when I was in College: "Hey, you no longer have to work and here's twenty thousand dollars." Woohoo!!! Lets party!

          Unfortunatly, once you graduate college it becomes a much more difficult situation. A middle aged engineer (and his/her family) can become quickly accustomed to that

      • The layoffs are in Marketing. *cackle* Hey sucks to be them, I wonder if they will replace them in Bangalore.

      • Re: (Score:3, Interesting)

        by timeOday (582209)
        I could understand suddenly firing 10% of the workforce if there were some unforeseen dramatic event that hurt business overnight, such as airlines after 911. But Intel has been in a very gradual decline for a number of years. If they had acted sooner but more gradually, they might have been able to downsize through natural attrition (retirements and people who quit), rather than a sudden painful cut.
    • Word is... (Score:2, Funny)

      by whiskeyriver (909231)
      ...Intel's re-hired the Blue Man Group to perform at the goodbye party.
    • Re: (Score:3, Funny)

      by Guppy06 (410832)
      "I think Intel has more class than some other companies."

      "ZOMG! The socket 7 chip on the motherboard isn't GenuineIntel! Don't let it POST!"

      That little bit of Intel "class" is why I've gone AMD-only to begin with.
    • Not knee jerk (Score:5, Insightful)

      by cryfreedomlove (929828) on Friday September 01, 2006 @10:18AM (#16023764)
      This probably is not the simplistic knee jerk reaction that you describe. I'm sure that any of us could identify a lot of redundancy or simple non-performance in any organization of 100,000 people. If you were running an organization with redundancy and dead wood and you were faced with competition from AMD then what would you do?
      • They probably didn't up and say "Hey engineers, nice job on the Conroe core. We don't need you any more, good luck in the future!"

        Intel has a hand in a lot of IC markets, not just CPU's. There has to be some needless redundancy in managing these (ie, a manager for widget A line and a separate manager for widget B line -- are they both necessary?). While these are good strategies when you set out, these lines may integrate well with the core management structure. That means job cuts, but the talented
    • I think Intel has more class than some other companies.

      Despite your optimism, I was spot on with my prediction [slashdot.org].

      Many other companies in the past, including one I worked for, begin by slashing managers. Then they consolidate operations under a new management structure and then the big cut happens as the attempt to eliminate "redundant" operations and employees. This is a tricky thing to do because sometimes they cut out keystone employees which are their real foundation and founder a bit. Expect anothe

      • Link to your prediction, instead of just the story: Only the First Shoe to Drop [slashdot.org].

        That Slashdot story linked to a Forbes story about Intel laying off 1000 managerial positions [forbes.com]. That was an admission that Intel has been badly managed in the past. Otherwise, how could they have 1,000 managers they don't need?

        They don't need to fire thousands. They need to fire Intel CEO Paul Otellini. He has made Intel more adversarial toward its employees, and therefore less efficient. Intel employees spend a good part o
    • The writer of a LOT of truly superb Linux Weekly News articles on how the kernel works is Valerie Henson [nmt.edu]. Valerie works at Intel. This means that there's a 10% chance a corporation doing heavy, front-line R&D in Linux will have a chance to hire a brilliant mind. (Unfortunately, the place I work is two states away, so there's no hope here.)
  • That lame dancing by the clowns in the aluminised bunny suits will not be missed. Hooray for competition, this clearly signals the end of the monopoly. Hopefully this trend will continue to the desktop OS (or more properly, Program Loading Environment with a bunch of device drivers) market.
    • by Rogerborg (306625)
      Um, they are starting with the bunny suit guys. I know it's important to get your comment in without wasting time reading the article, but the biggest losses will be in marketing. So this is just 100% great news for all the people involved.
      • WTF? (Score:3, Funny)

        by Doctor Memory (6336)
        the biggest losses will be in marketing
        Because when a company's losing market share, it's obviously because they're doing too much marketing...
        • Because when a company's losing market share, it's obviously because they're doing too much marketing...

          Indeed. It always puzzles me that a company's first reaction to reduced profits is to generate demoralize staff and generate ill-will through mass firings.

          To make an analogy, if you start suffering from hypothermia your body starts sacrificing limbs to save the core. This allows you to live just a little bit longer. But this is a near-sighted strategy---having functional limbs seems to me more importan
    • Re: (Score:3, Insightful)

      by SpecTheIntro (951219)

      Hooray for competition, this clearly signals the end of the monopoly.

      I beg your pardon? Intel is absolutely dominating AMD in the notebook market. It already had the vast majority in the desktop market, and with the release of the Core 2 Duo, it's only going to get worse. And on top of that, the new Xeons are better performers than the Opterons in every server test you can imagine. (Although Opteron scalability is still more efficient, thanks to the on-die memory controller.) The "monopoly" was shattered

      • Re: (Score:3, Insightful)

        by radtea (464814)
        Things are looking better than ever for Intel. And this job cut is only going to help.

        Why do you think that, given the well-known fact that companies that undergo significant layoffs underperform the market for the next few years?

        10% may be below the critical threshold where cuts do more harm than good, but not by much.

        "This job cut may help" would be a rational statement. "This cut is going to help" indicates an unjustified level of confidence in anyone's ability to predict the consequences of a complex a
        • Why do you think that, given the well-known fact that companies that undergo significant layoffs underperform the market for the next few years?

          I can't find any documentation that would suggest this is true. Can you provide studies or empirical examples?

          "This job cut may help" would be a rational statement. "This cut is going to help" indicates an unjustified level of confidence in anyone's ability to predict the consequences of a complex action within an evolving market.

          You're right; I am probably pl

        • by MrNemesis (587188)
          Why do you think that, given the well-known fact that companies that undergo significant layoffs underperform the market for the next few years?

          Unless the 10% they're firing are the same 10% who the other 90% with way too much money hired because there was nothing else they could think to do with it...?

          I know it's a popular myth that the Netburst arch was designed by the marketing team and that Intel is a big lumbering behemoth that was caught napping by AMD and the K8, but I wonder how much management and
      • Re: (Score:3, Insightful)

        by RzUpAnmsCwrds (262647)
        It's not about performance. Read that again. In today's market, it's about the platform and the pricing as much as it is about the product. Core 2 is too expensive ($240 for a 2.13GHz Core 2). Most of the market doesn't care whether or not Intel's $250 CPU beats AMD's $250 CPU (as it turns out, the competition is remarkably close). It's not about Athlon X2 vs Core 2. It's about Sempron vs. Celeron.

        The end of the Intel monopoly hasn't happened yet. It didn't happen when Athlon 64 or Opteron was released. It
  • I think Intel is going to make a comeback and crush AMD. Here is why I think that: Imagine a world where Apple is pushing more boxes then Dell and all of them have an Intel Chip inside. They are only hurting right now because of the tiff they had with MS over their new 64 bit design. Developers did not like it since it had a totally different instruction set. With all the trouble with their new chips MS decided to put their full force behind AMD, and Intel suffered. It is too bad that such a large number o
    • by raehl (609729) <raehl311@@@yahoo...com> on Friday September 01, 2006 @10:04AM (#16023683) Homepage
      Well, maybe all those qualified engineers will go on to find jobs that are more productive, and build better things for society.

      Unfortunately, successful companies have a bad habit of hiring people to do new projects 'because they can'. The money is there to hire more people, so, they hire more people. The more successful the company is, the less scrutiny is applied to how likely the new proect is t result in actual new revenue for the company.

      After enough of this, the company finds itself burdened with a lot of labor working on things that are not really relevant o the company's main business, which negatively impacts the company's performance, and ultimately forces a layoff.

      It would be better, of course, if sucessful companies could avoid the temptation in the first place and give that money to shareholders.
      • Re: (Score:3, Funny)

        by The Fun Guy (21791)
        Well, maybe all those qualified engineers will go on to find jobs that are more productive, and build better things for society.

        Um, here's the relevant quote from TFA:

        The job cut is likely to weigh particularly heavily on marketing staff. Intel studies comparing its own staffing levels to competitors' concluded that the ratio of marketing personnel to salespeople was too large, the sources said.

        Marketing staff are a necessary evil. They are super important when there's not really much difference between you

    • by Blob Pet (86206)
      Imagine a world where Apple is pushing more boxes then Dell

      Don't hold your breath waiting for that to happen.

      Motorola never really made any money supplying CPUs for Apple, and neither will Intel.
      • by eshefer (12336)
        at the current rate of a 25% growth rate of mac sales, outpacing the rest of the PC industry, I'd say that scenario is quite likely to happen.

    • by Ubergrendle (531719) on Friday September 01, 2006 @10:05AM (#16023691) Journal
      What are you smoking -- I'd like some!

      First off, Apple has between 5-6% of the total PC base in the world right now. They have a loooong way to come even close to matching ONE of IBM (Lenovo), HP, or Dell. Intel made a nice marketing coup with lining up Apple, but its no panacea of profit.

      Two, yes Intel goofed on the 64 instruction set. But WinXp runs on Athlon and Pentiums, and there's very little real 64 bit computing taking place on corporate desktops even today. Intel needed to make cheaper, faster, more efficient processors -- something they've finally done with the dual-core. Both server and desktop segements will do benefit from the latest designs.

      Strikes me now that Intel finally has a decent product in the marketplace again, they're cutting back on R&D since they're 'in the game' once again. When you're behind, you have to spend money to catch up. Allowing AMD to beat them for so long on price and performance had to be galling to a company the size of Intel -- someone was asleep at the switch.

      I love competition, I think Intel is in for some good times now, but I doubt they'll ever be as dominant as they were in the early 90s ever again. AMD has their work cut out for them, but getting where they are today was MUCH harder than what they're facing now.
      • by soft_guy (534437)
        Intel does a lot of things that have very little to do with their core business of making microprocessors - consumer electronics and software that doesn't strategically support their core business. They can afford to cut back on things like that.
      • Strikes me now that Intel finally has a decent product in the marketplace again, they're cutting back on R&D since they're 'in the game' once again.

        They are shaving off MARKETING STAFF. Bwahahah! Yes indeed, leave your victim complexes at the door.

  • by Anonymous Coward on Friday September 01, 2006 @09:56AM (#16023638)
    Middle management is a great waste of skin. Plus they often take a fairly large salary while not generating revenue or a product.
    • by QuantumG (50515)
      Hey! Middle management serve a critical function in today's multinational corpora... ahh, hell, I can't keep that up.
    • Re: (Score:2, Informative)

      by Anonymous Coward
      Wow, did you um, perhaps, oh I dunno...RTFA before posting? In the article it says that Intel has already cut down about 1,000 management positions, and most of the positions that are going now are marketing positions. Not necessarily "the little guy".....
    • > Middle management is a great waste of skin. Plus they often take a fairly large salary while not generating revenue or a product.

      Middle management should be second, after 90% of the executives, and do NOT give them parachutes. With executives and middle management gone, you'd be surprised how much work gets done by conscientious, motivated staff. Of course, I also believe that Marxism could work too. :-)

      jfs

      • Pile of Crap. (Score:4, Insightful)

        by raehl (609729) <raehl311@@@yahoo...com> on Friday September 01, 2006 @02:41PM (#16025818) Homepage
        Disclaimer: I am an actual engineer.

        Middle-management is essential to getting my job done. I don't want to have to negotiate with the tool vendors on price or licenses. I don't want to have to evaluate how well people are performing. I don't want to have to find, interview, and hire new employees. I don't want to do the department budget, set the schedule, fight to get materials on time from vendors, etc, etc. And, most importantly, I don't want to have to explain what I'm doing to upper management.

        Now, some managers are definitely useless, but so are some engineers. That's not a job-level problem, that's a people problem.
    • " It laid off 1,000 managers earlier in July, saying the move would speed decision-making. "

      I wonder how many multi-core CPUs they needed to finally compute the wisdom of this decision.
    • by Peldor (639336)
      Intel already axed 1000 people in middle management earlier this year.

      http://news.com.com/Intel+axes+1,000+managers/2100 -1014_3-6093843.html [com.com]

      10% seems fairly drastic to me for a company that is still VERY profitable in 'bad' quarters, but large organizations also tend to over-staff during the best years.

  • by tomstdenis (446163) <tomstdenis@REDHATgmail.com minus distro> on Friday September 01, 2006 @09:56AM (#16023644) Homepage
    1. Get with direct link interconnects, FSB is teh stupid
    2. Stop making a new core every other Tuesday, m'kay?
    3. 4MB of cache is nice, but it has to be hella expensive right? [*]
    4. Merge with Nvidia, totally mess up the PC scene, it'll be fun :-)

    [*] Don't look at the retail cost for the true margins they make [if any] on the cores. Selling at a loss or near loss is not a new tactic.

    Tom
    • 4. Merge with Nvidia, totally mess up the PC scene, it'll be fun :-)

      (shudders) I can see the disclaimers and support lines for PC gaming now. Every game needing two versions to be built, directx versions dependant upon amd vs intel, it would be like the massive difference between graphics drivers now, but taken to the extreme. At least nvidia and intel both have decent levels of support for linux.
      • Re: (Score:3, Interesting)

        by tomstdenis (446163)
        Yeah that's why it would be fun. I think we need more vendor-lockin nowadays. If we can't beat them join em.

        And yeah, it is nice that Intel is more pro-OSS... /me looks to employer, how about we support OSS? /me takes that back, wants to keep job.

        Tom
    • As it is, the current systems effectively have direct link interconnects to the system chipset. The Bensley workstation and server platform gives each CPU package its own bus so it's not causing contention with bus sharing. Kentsfield and Clovertown throw a bit of a wrench to that but that will be rectified in 2007 when Intel releases a single die four core chip.

      Is Intel really selling any of the chips at a loss?
    • 1. Get with direct link interconnects, FSB is teh stupid

      2. Stop making a new core every other Tuesday, m'kay?

      3. 4MB of cache is nice, but it has to be hella expensive right? [*]

      4. Merge with Nvidia, totally mess up the PC scene, it'll be fun :-)

      1. You're purposefully mis-spelling "the" and can call Intel stupid on what grounds? How many CPU architectures have you done that are half as competitive as Core? Direct links are excellent for UP and small SMP systems. When scaling up, the situation is fa

    • by uarch (637449)

      1. Get with direct link interconnects, FSB is teh stupid

      1) Google "Intel CSI"
      2) Point-to-point links are not always better than a shared bus. Its a tradeoff. Some factors swing one way. Some swing the other way. (Power is a big one. HT was a power-hog for a while and caused a problem in the notbook sector.)

      2. Stop making a new core every other Tuesday, m'kay?

      1) Google "Intel converged core" or "Intel converged chip"

      3. 4MB of cache is nice, but it has to be hella expensive right? [*]

      1) They have

  • Do it back to them. (Score:4, Interesting)

    by neo (4625) on Friday September 01, 2006 @09:59AM (#16023650)
    Quit Your Job Day, Sept 18th.

    The goal of Quit Your Job Day is to reverse the advantage perpetuated by an elitist class who profit from your actions without making any personal investment in you as an individual. If you don't know who profits from your hard work, I assure you that they care very little about you. You are just a line on a spreadsheet and if cutting your salary would make the column balance, you're fired.

    http://www.quityourjobday.com/ [quityourjobday.com]
    • by Overzeetop (214511) on Friday September 01, 2006 @10:12AM (#16023732) Journal
      That's why there are Unions. And, as typcially happens, the Union becomes exactly what the employee hated about management - a political, bottom line driven organization used to forcefully extract concessions from the opposite side. They're just working for you instead of the other side now.

      It all comes back to monkeyspace. Big corporations exceed it, and need a kick in the pants (or regulations) to return balance. That's one reason why many small businesses are not regulated, and why many don't need it (oh sure, some do...some really do) - the 50 employee limit is within a standard human monkeyspace.
      • by neo (4625)
        No this guy is making some sense.

        Groups that get too big lose touch with any sense of humanity. You can't keep your humanity when your boss and his boss are telling you to pay attention to numbers. And when a big group makes a mistake, well the humanity that's affected is huge. 10,000 people is a lot of people.

        Quit your corp job, start your own company. Keep it small and be happy.
    • by Otter (3800)
      I like the comforting assurance they provide with their contact information: "We also promise not to make fun of you regardless of how ridiculous your ideas might be."

      That's probably the highest-returning investment on not casting out the mote in one's brethren's eye in all the time since Jesus coined the phrase.

      • by Otter (3800)
        I also like their FAQ entry:
        Q. I don't have a job. What can I do to help?
        .
        .
        The third way is to donate through PayPal. We could really use the money (we quit our jobs last Monday).
    • by Sj0 (472011)
      Jesus, if you want to be unionized so badly, just unionize.
      • by neo (4625)
        See previous poster regarding unions. To paraphrase, if you unionize, eventually the union just becomes a corporation itself and a service provider for the business.

        We don't need more unions. They were needed in the past, but now they are just self serving entities.
  • by Plammox (717738) on Friday September 01, 2006 @10:08AM (#16023708)
    They have been laying or selling off in their telecom chip business since June [lightreading.com].
    • Re: (Score:3, Interesting)

      by Doctor Memory (6336)
      When I lived in Portland (just after the turn of the century), Intel was one of the few stable tech companies out there. Toshiba, Hitachi and IBM all closed their fabs in the area, and most of the "silicon forest" was left to wither. I was unemployed for the first time in my life, and it lasted for six months before I picked up a short-term gig at Nike. If you heard the phrase "I work at Intel", you knew that within ten seconds someone would say "Is your group hiring?" or "Here's my resume!"

      I'm just surp
  • by Trollificus (253741) on Friday September 01, 2006 @10:15AM (#16023746) Journal

    Back in my day, we remained competitive by building a superior product at an affordable price, up-hill both ways!

    /get off my lawn

    • by tashanna (409911)
      The problem with Silicon Valley is that there's no snow to walk up hill both ways in. Those dern engineers had it easy.

      - Tash [tashcorp.net]
  • by Mayhem178 (920970)
    What do they think those 10% of people (i.e. lots) are gonna do? Smile, take it in the rump, and bid them good day? A bunch of them are gonna end up working for AMD, and I'm sure they'll be happy to have people with experience at Intel. Non-compete clauses don't last forever.
    • by mgblst (80109)
      It depends whether they get rid of a random cross-section of people, or just all the crappy ones. That is what I would do, if I was put in this situation.
    • Non-compete clauses don't last forever.

      And aren't enforceable everywhere.

      Tom
    • Re:Brilliant... (Score:4, Interesting)

      by Coward the Anonymous (584745) on Friday September 01, 2006 @10:53AM (#16024030)
      I doubt they will be laying off much if any of their chip design talent. This is probably managerial and administrative staff throughout the company (general IT, accounting, call centers, etc...) People who can't really provide a comptetive advantage to another chip maker and most like don't even have non-compete agreements.
    • by soft_guy (534437)
      Non-compete clauses don't last forever.

      Non-compete clauses generally do not apply to people who are laid off. The ones I have signed have only applied in the case where I choose to quit.

      Just as an aside, when you are asked to sign something like this, make sure you read it. If you don't like it, talk to your potential employer and see if you can negotiate different wording. My current company tried to have me sign a very open-ended non-compete. The way it was worded, at least seemed to me (and my attorney)
  • by blueZ3 (744446) on Friday September 01, 2006 @10:27AM (#16023822) Homepage
    I have a neighbor who works at the Intel office here in the Silicon Valley and she's known for quite a while that these were in the works. IIRC, she was talking about this back in April or May.

    One thing that I've always thought about company layoff planning is that there's a difficult choice to be made over when to notify employees that a layoff is in the works. Too little notice and people feel like they're being dumped without warning, too much and you have a long period of tension and a lot of people slacking off because they know that they're headed for the unemployment line.

    When I worked for a division of a major company that was planning layoffs, we all knew in June that the offices in California were going to be closed by the end of the year, and offical notice came in October. The company did something that I considered a stand-up thing: they told us who was going (in October) and gave us official permission for the rest of the year to look for work using company resources. It was cool for them to give us that much notice (though because of the slow market at the time, it was hard to find work even with such a long lead time). However, a lot of employees (including ones who really were supposed to be doing something else) spent the time building houses of cards out of their company business cards, driving remote-controlled cars around the cubes, and generally goofing off.

    Again, it was a cool thing for the company to do (and I am aware that there are financial incentives for getting your employees hired off before closing an office--but I don't think those offset the cost of paying them salary for three months) but I can see that there are employers who couldn't afford to do that.

    Here's hoping all the folks getting pink slips at Intel can find something else to do as quickly as they'd like.
  • More competitive? (Score:5, Interesting)

    by jb_nizet (98713) on Friday September 01, 2006 @10:30AM (#16023846)
    I don't see why laying off people would make them more competitive against AMD. Sure, their HR department will have less work afterwards, but they're not the ones who will make Intel more competitive.
    This is just to make the actions go up and make the investors richer, but it won't make them more competitive to AMD, and more attractive to customers.
    My compassion will to the laid off employees, and my money will go to AMD when I'll buy a new chip.
    • While I appreciate the sentiment of buying = voting, you also should be buying what you actually need. If that happens to be an Intel or Samsung or whatever processor [Samsung makes ARM processors...] so be it.

      I agree that AMD is a smart choice both on technological and political fronts. But for the general public with a 1P configuration the benefits of AMD can be lost on them. ... I also happen to think more people need 2P setups :-) nothing like encoding two movies at high quality, two pass mode at 30fp
    • by jank1887 (815982) on Friday September 01, 2006 @11:02AM (#16024101)
      10,000 employees, estimate $100,000 per year total expenses per employee = 1 Billion dollars per year saved. If you can minimize the negative impact of that cut on your budget (i.e., drop money sucking programs, keep production/sales at a status quo, etc.) then you have increased your yearly net profit. Profit = competition resource. More competition resources at your disosal = more competitive.

      If needed and done right, it's the way capitalism is supposed to work. If it's just a wall-street ploy and actually hurts other areas of their bottom line, well, poo on them.

  • Deff (Score:4, Funny)

    by Wellington Grey (942717) on Friday September 01, 2006 @10:32AM (#16023860) Homepage Journal
    1 in 10? Why, they'll be decimated!

    -Grey [wellingtongrey.net]
    • I'd like to know the etymological history on this. How did it go from punishing a legion unit to a euphemism for near-annihilation.

      Crazy language.
  • Seriously, where are the good paying jobs going to come from in the next 50-100 years in the US? Assuming not everyone will come up with a brilliant idea to make them rich. Globalization isn't necessarily a bad thing but I would like to see the results of an economic simulation where an entire coutry, like say the US, wraps itself in isolationist economic and trade policies, and see what happens.
    • Re: (Score:3, Insightful)

      by protohiro1 (590732)
      Very good question, especially considering that the American consumer is a prime driver in the world economy. Here is the new plan for the US economy:
      1. Consumers like cheap stuff
      2. Outsource manufacturing, cut wages across the board, sell stuff for cheaper.
      3. Workers make less and want(need) even cheaper stuff
      4. Go to step 2
      5. Profit!

      Special bonus question: Will step 5 ever execute?

      • Re: (Score:3, Insightful)

        by demigod (20497)
        Special bonus question: Will step 5 ever execute?

        You've got the algorithm wrong. This one is none standard.

        1. Consumers like cheap stuff
        2. Outsource manufacturing, cut wages across the board.
        3. Sell stuff a little cheaper, pocket the difference.
        4. Profit!
        5. Workers make less and want(need) even cheaper stuff
        6. Go to step 2

        The bonus question should be: When does this unsustainable model collapse?

        Just how long can the rich get richer and still sell stuff the poor who are getting poorer?

    • by mc6809e (214243)
      Globalization isn't necessarily a bad thing but I would like to see the results of an economic simulation where an entire coutry, like say the US, wraps itself in isolationist economic and trade policies, and see what happens.

      You don't have to. Just imagine cutting your state or city off from the rest of the country. You'll get the same sort of results.

    • by uarch (637449)
      You're kidding right? Intel has great employees (I worked there for a bit before taking an offer somewhere else). If they want work they'll find it.

      The question isn't where will the good paying jobs come from. The question is where will we find the people to fill them. There is already a shortage of good engineers in certain fields and hardware design is one of those fields.
    • the answer is, healthcare, biology, nanotech, security and disaster recovery, alternative energy and energy storage, mass transit, ubiquitous networking and communication, hedge funds, supply chain and distribution logistics, and probably not a few other fields I missed.
  • Back in '00 or '01 Intel bought the DEC Alpha group that was a step in the right direction. But from reading the INQ it seems that most of their projects were canceled and by now most of the top Alpha architects have quit.
  • by MancDiceman (776332) on Friday September 01, 2006 @10:41AM (#16023941)
    So let me get this right: the plan was to wait until after the stock market closed Tuesday, then announce, so people don't run around dumping stock like headless chickens?

    And The Reg, Reuters and Slashdot have got it now?

    I love it when a plan comes toge... oh. Ah. Well, errrmmm.... if you work for Intel, have a GREAT weekend, and if you own shares, well, you've only got some 20+ hours trading to go before the announcement, so take your time...
    • Re: (Score:3, Insightful)

      by rcamera (517595)
      why would people dump stock because of a layoff announcment? typically, this is seen as a way to spend less, which increases earnings per share. eps is what drives stock prices, not headcount. (fyi: intel is up ~0.9 - 1.0% on the day)
    • Re: (Score:3, Interesting)

      by uarch (637449)
      This rumor has been out there for over a month. There was even a reference to it on ./ when they posted they story about Intel laying off 1000 managers. Everyone expects further cuts but until they actually tell the employees what's happening these posts are just rehashing the same old rumors.

      I was a little surprised it made it onto ./ today but then I remembered this was ./ - land of the double posts.
  • offshoring (Score:2, Interesting)

    by escay (923320)
    This maybe purely hearsay but i've heard that some of the ppl being laid off were given an option of relocating to an offshore intel group (india/malaysia/israel) where the remuneration in US$ is much less - this way they get to keep the people in, and cut back on the budget as well. the wonders(curse?) of globalization!
  • by gnetwerker (526997) on Friday September 01, 2006 @12:46PM (#16024857) Journal
    This is, as others have observed, long overdue. When Intel could maintain a dominant market share, and thus pricing power over its competition (primarily AMD), it could afford to be (or try 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 low-cost end-user peripheral maker, a toy manufacturer, a maker of LCoS-TV chips, and numerous other misbegotten adventures far from its core competence.

    What Intel is at heart, and will be for some time, is the world's best high-volume manufacturer of semiconductors, something that requires a far, far lower load of white-collar workers than being a broad-ranging technology company. Intel will continue to 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. This is why its P/E is 17x and not, for example, Google's 55x or even Microsoft's 21x. Look for it to trend upward in the short-term, but in the longer term settle toward US Steel's 8x.

    Also note that recent management changes have elevated Sean Maloney into an heir-apparent position. This signals the fin de siecle, completing the transition from an engineer/scientist leader (Andy Grove) through a manufacturing guru (Barrett), to a bean-counter (Otellini), ending with a salesman (Maloney). How the mighty have fallen.

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