Skype Execs Purged On Eve of MS Takeover 300
jfruhlinger writes "You might think that the executive team that engineered a lucrative buyout for their company would be rewarded. But eight execs from Skype instead found themselves fired just before their company was formally taken over by Microsoft. It appears that this move isn't meddling from Redmond; rather, the private equity firm that owns a 70 percent stake in Skype wanted to cut back on the payout to company execs that would normally accompany this kind of transaction."
Ah, but I wanted to blame Microsoft (Score:3, Funny)
It appears that this move isn't meddling from Redmond
There must be SOME way I can blame this on evil Microsoft. Were the fired execs open source, by any chance?
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They wouldn't have been fired if MSFT didn't buy Skype?
Re:Ah, but I wanted to blame Microsoft (Score:4, Insightful)
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I like it better like this, I would've hated to give MS credit for firing a bunch of the overpaid freeloading bastards.
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How many similarly paid, highly ranked were not let go?
Re:Ah, but I wanted to blame Microsoft (Score:5, Insightful)
Re:Ah, but I wanted to blame Microsoft (Score:4, Insightful)
So some other overpaid freeloading bastards (The VCs) fired some other overpaid, freeloading bastards (The Execs)?
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It shows you who wears the pants in that relationship.
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There must be SOME way I can blame this on evil Microsoft. Were the fired execs open source, by any chance?
It would appear so... they definitely got forked!
A new kind of evil? (Score:4, Funny)
Now we blame everything on Apple..... and sometimes google.
Not everything, just the moderate amount of evil that isn't actually Microsoft's fault. Most of it can be fairly blamed on Apple, but this one kind of falls through the cracks. It's evil, but can't really be blamed on Microsoft or Apple or Adobe or Oracle (the usual gang of malefactors), Google haters are utterly stumped, and it's not even patent or DRM style evil.
The invisible hand of captialism (Score:5, Insightful)
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Always seems to be carrying a very sharp sword.
There's always voting with your dollars, take them elsewhere - helps blunt such swords.
Re:The invisible hand of captialism (Score:5, Informative)
I'll let you into a secret, they knew, probably got paid well and Microsoft were in on it.
1) As an exec in company like this you come in with a contract that has all departure routes covered, outside being fired for cause. It's standard practice and if you didn't require it, you wouldn't be doing that job. So yes, they were made whole and that means a lot of cash, probably a chunk of equity prior to the sale.
2) Microsoft negotiated the options for the buy out and that means assessing and pruning the management at Skype, before the sale. Skype didn't just futz with the company on the eve of the sale. Removing the folks MS don't want before the sale takes the focus off of MS for clearing out who it doesn't want. It would be a negotiated point.
3) My guess is that these execs are M&A (Mergers and Acquisition) specialists. They were likely specifically bought in to engineer something like this. So they've done their job and they'll move on to the next.
You don't sell/buy something for $8.5 billion and not talk about everything. Trust me, everybody knew way before now who was staying, who was leaving and how much money they were going to make.
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Doesn't look that way, but I agree on all of your other points.
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"I find it extremely hard to believe that Microsoft would exist anywhere near its current dominant position if we actually did have capitalism."
Damn straight.
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I'm curious how you imagine that world to be.
It's not like we don't have an open source version of near every kind of software Microsoft makes.
In the sense that no one would sink the resources that Microsoft has into developing the likes of a Windows or an Office if it was completely legal for everyone to just directly copy it? Yeah, that's probably true -- but then the free closest equivalents we have today probably wouldn't be as far along, in general, either.
Re:The invisible hand of captialism (Score:5, Insightful)
Yeah, this argument is retarded, as everyone else in the sector enjoys the same protections on their software. Basically, it says, "If I could compete with Microsoft by selling their OS, Microsoft Windows, then they wouldn't be a monopoly." Basically saying that, if you could just clone their software and compete with them by selling the same thing, yet you without all the R&D costs that Microsoft put into it, then there'd be "competition".
This also completely ignores the fact that Microsoft forced a bunch of OEMs to pay them royalties on all computers, even those without Windows, in blatant violation of all anti-trust laws and anti-competition laws. Face it, Microsoft became a monopoly of their own doing, not by being propped up by "government."
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I may have misunderstood your assertion, but Microsoft exists because of capitalism. Your quixotic view of intellectual property doesn't really apply to the origins of Microsoft. Microsoft is a product of being at the right place and at the right time. They understood the market and delivered what the customer wanted. Their market share reached critical mass and from
Wut? (Score:2)
I find it extremely hard to believe that Microsoft would exist anywhere near its current dominant position if we actually did have capitalism. Instead, we have government protection of intellectual property, which is essentially the foundation of Microsoft's entire business model. Government force is not capitalism.
Know any history of Microsoft? Here it is in a nutshell -
Microsoft's fortune was built on business standardizing on MS-DOS. Once businesses committed to Microsoft they were made, millions and millions of dollars rolled in for copies of a relatively simple operating system. They imitated all and sunder. Then they made a half-a**ed copy of MacOS and called it Windows 95, started bundling free half-a**ed versions of other's software to expand influence - the companies and innovation they killed are legion
Re:The invisible hand of captialism (Score:4, Insightful)
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Contracts could be enforced on a voluntary basis.
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A better question in that case is - would the industry as a whole be more advanced than now, or would it be less advanced?
I don't think we know.
Without government protection of intellectual property, how would the companies protect their stuff?
Maybe they wouldn't. If it was generally accepted that nobody can own an idea, maybe companies would shamlessly copy each other and all advancement would be based on that. You'd be driven by making someone else's idea better and then they would in turn build on your innovations. I saw an interesting lecture (TED, maybe?) about how this works in the fashion industry. In fashion, designs are not protected and what happens is that you develop a culture where you build off of other people
Fired? (Score:4, Informative)
The spokeswoman declined to say whether the eight executives were laid off or resigned.
Someone knows something not in the linked article?
Re:Fired? (Score:5, Insightful)
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And if those options weren't vested yet?
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Sounds like a lawsuit against the company for breach of contract....
"Firing" execs to avoid upholding the terms, in regards to required compensation for executives in event of a buyout?
This is not going to make things easier for that VC firm to do business going forward, after such a dirty show of dishonesty
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Whole team? (Score:4, Interesting)
What matter is whether they were the whole team, half the team. or deadwood statues of the team.
It's hard for outsiders to recognize the deadwood, and it's hard for insiders to fire their friends. Sometimes takeover time is a good time for insiders to let the outsiders clean house. Is this what happened or was the whole team let go?? This is something that an outside observer can figure just by visiting the parking lot.
Who cares if the were laid off. They are out in either case. Unless they turned into contractors.
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They were still part of the company, taking a risk in doing so. Should they not partake in the rewards?
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Still kind of an asshole move at this point I think.
"Gee Bob, you've been with the company a few years and, frankly, I've always thought you were a bit of a dim bulb. I've been meaning to fire you for years, but now that we've all worked our asses off to get this buyout to get through I think I should do it before you get your multimillion dollar bonus you've been working for."
when the victims of corporate psychopaths (Score:5, Insightful)
are other corporate psychopaths, it's hard to feel sympathy
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Re:when the victims of corporate psychopaths (Score:5, Interesting)
IMHO, the only thing worse than execs of of a corp getting paid off at the expense of employees during a take over, is when a nameless venture cap org does.
We don't know the whole story, but if venture cap nuked execs (that might possibly have been instrumental in making the company successful) to increase their own take, that is *WORSE*.
Re:when the victims of corporate psychopaths (Score:4, Insightful)
Why? At least VCs actually do something with the cash. Invest it in other places to make more money. C*Os tend to simply sit in a company and get rich. Sometimes they move to other companies that are already established and get rich. Very rarely do they take that money and knowledge and make something new to make money with.
Re:when the victims of corporate psychopaths (Score:4, Insightful)
C*O's of start ups or young companies typically aren't fat cats who siphon cash while contributing zero. A small corp will quickly die off as all jobs, from ground floor peons to the CEO are important.
C*Os of established corps can indeed be fat cats. Established revenue streams, customers, large enough assert hoards to give a company viability via inertia for more than 4 quarters. Inattention and self-serving proclamations that don't result in immediate corporate implosion, can thrive in that environment.
VC's exist to generate return on investment for their major partners. Some act as angels, but most promise x% return on investment to their patrons. If the VC is short on promise #s, they will take the short term personal gain over the long term health of the entity they are selling.
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*golf clap*
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yes
they don't create anything. they move money around and call it work. it's not work, it's gambling, and it's a shell game that eventually blows up and hurts those of us interested in actually leading productive lives that actually produce things
and i don't have anything against gambling. if you want to hurt yourself by investing your money in bubbles of greed, go right ahead. but these assholes never stop with just their own money. their modus operandi is gaining trust they don't deserve in order to get m
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that's ok. because i'm venting in a comment thread, not writing a thesis paper. stop applying thesis paper level standards to a comment thread
and also: stop expecting "sources." i hate people who want sources in informal comment threads. this isn't intellectual charity, do your own damn homework
if you don't like something i've written, refute it yourself. it's not my job to bring you up to speed, i'm not your dad. i have no expectation that you're going to agree with me, so go ahead and reject my words, tha
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yes
they don't create anything. they move money around and call it work. it's not work, it's gambling
1. rethorical nonsense != understanding of economics and the nature of work.
More importantly...
2. generalizations != facts.
On generalizations, you can't equate an exec from, say Lehman or Enron to an exec at any randomly picked company simply because it fits the nice black-and-white ideological pigeonholes that make up your thinking process. Unless you have actual facts about the execs @ skype, you are simply talking emotionally-driven, subjective rethorical shit.
I know this is /. but c'mon, this i
Corporate Sleeze (Score:4, Insightful)
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So you're implying that some of the workers might have thought that MS cares about contribution? Of value, to products they sell? No, I don't think anyone without a financial reason to would believe that, if they've used an MS product other than Excel.
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Same here. Screw the quitters who sold out, now I have to find a new VOIP solution.
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Said the guy who's company is probably wondering why it's employees don't work harder for them or show them any loyalty.
Investor greed trumps the executive's greed (Score:3)
I can't see how it was reasonable to expect that either side of this transaction would want to "reward" those that "engineered a lucrative buy-out" - either it costs the investors money (why give up money you don't have to?) or the buyer will be mad at the people that increased the price of your aqusition (why reward someone for driving up your cost?).
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This statement is absurd on its face. Why the fuck else should they engineer this, if they weren't getting a reward?
Interesting... (Score:4, Interesting)
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Please don't use the word "rightsize". It's just insulting all around. They were fired.
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Ownership implies responsibility. Shareholders are not responsible for debt so they are not owners, just leeches.
Private equity firms are the Gekkoesque scourge of modern capitalism, confusing the passion of success in producing something you love (see Hewlett, Packard, Olsen et al.) with the passion of making money because the rules let you.
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If that weren't the case then the notion of the modern shareholder would be even more one-sided. If I stop paying my mortgage for my negative equity house then I lose my house and the money I put into it.
Private equity leeches are endemic partly because they get to socialise the losses. If they had to use their assets to pay for the debts created each time they fucked up another firm then they would be forced to behave either on a smaller scale or in the long term interest of the companies they own. But the
Shed no tears for them. (Score:5, Informative)
These suits ate little fish in their time. They got eaten by bigger fish. They will again start eating little fish once again. Just stay out of their jaws, if you can.
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I'll shed no tears. Primarily because people at these levels typically negotiate personal services contracts rather than employment at will. And any smart attorney will include language to lock in benefits (or a suitable termination fee) in the event any change in ownership is impending.
The founders and early employees will probably get Microsoft stock. For that, they will shed tears. I'll be ROTFLMA.
Don't feel bad, dear managers (Score:5, Insightful)
You know, every time a takeover happens some people get fired.
I am delighted to see that for a change it happens to you.
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You know, every time a takeover happens some people get fired.
I am delighted to see that for a change it happens to you.
The last executive I knew personally who got fired got a two year paid vacation and the free services of a company to find him his next cushy job. These execs were just rewarded for selling their company. There's no way you can spin this as a bad thing for them.
and the next step is.... (Score:2)
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...cue litigation in ...1...2...3...
Countdown fail!
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well, as long as he exits when zero, he'll eventually get there.
Reading into it? (Score:3, Insightful)
This submission, and the article referenced to, read entirely differently.
Where exactly does it say they were fired?
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It doesn't. There is probably more and better sources that mysteriously got left out of the summary per usual practice.
mergers are statistically bad for everyone (Score:5, Insightful)
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>> but instead pause in lament for the majority and progress in general
I always do! The other thing I try to do is leave as soon as possible if the company I happen to be working for is the one that has been acquired (former co-workers are inevitably laid off several months later). I hate mergers more as a customer since I've never seen service _NOT_ suffer... (the exception might be the acquisition of KeyHole by Google to form Google Earth)
Well said. (Score:3)
Because of our corrupt campaign finance system, neither Republicans nor Democrats will enforce the anti-trust laws. So we have constant mergers reducing the number of players competing in every market, but no force actively breaking up larger companies into smaller companies to apply pressure in the other direction.
The net result is less competition, and I shouldn't have to remind you that competition is the engine that drives a capitalist system.
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> One thing MS could do with Skype is to take on Telcos head on
Skype already was. Better product, lower price. As people realized that, they were inevitably jumping on board.
Now MSFT could just leave things alone and coast to victory. But it seems far more likely they'll spend millions to turn Skype into a crappy product at a crappy price. They'll turn Skype into just another telco.
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LoB
Awesme and most auspicious news (Score:2)
Now we can not say "Nobody got fired for buying Microsoft" let it spread like wildfire... let all top execs that are Microsoft Horny get laid off.
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Well, still nobody gets fired for buying Microsoft, but you might get fired for Microsoft buying you.
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Well it is more symbiotic than that when it is a business deal. IMHO it is always a mutual investment-buy rather than any selling.
I hope (Score:2)
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So... (Score:3)
What this basically means is the same type of executives that outsource operations and employees, needlessly eliminating thousands of positions at high tech companies for "cost cutting" purposes aka bonuses -- these very people are surprised they are being treated the same way by another greedy group of managers and money-men ?!
The way of the sociopath. (Score:2)
A story about sociopaths firing other sociopaths.
Corporate behavior (Score:2)
Usually, it's the little guys who get the axe while the executives get a parachute. Clearly there is more to this story than what we have available to us now. Perhaps there simply wasn't enough at the lower levels to cut to make a difference.
In the past, we have seen certain amounts of honor among the high level executive group offering each other golden parachutes and other deals that the regular people don't get. And what I read did not mention anything about exit compensation packages. They might hav
hahahahaha! (Score:2)
Good for them.....
they should have done this with all the big bankers also that put us in the economic mess we've been in, so that after being fired would
touch 0 dollars upon exiting for being so lax with the loan assessment scenarios that put the whole world economy in jeopardy!
Q. about "at will" employment... (Score:2)
Wait, where's teh connection (Score:2)
"You might think that the executive team that engineered a lucrative buyout for their company would be rewarded. But eight execs from Skype instead found themselves fired just before their company was formally taken over by Microsoft. It appears that this move isn't meddling from Redmond; rather, the private equity firm that owns a 70 percent stake in Skype wanted to cut back on the payout to company execs that would normally accompany this kind of transaction."
Damn, that's sneaky. Except wait - here are the eight execs:
The departures included David Gurle, vice president and general manager for Skype for Business; Don Albert, vice president and general manager for the Americas and Advertising; Doug Bewsher, chief marketing officer; Christopher Dean, head of consumer market business development; Russ Shaw, vice president and general manager; and Anne Gillespie, head of human resources. Two executives who joined Skype following its acquisition earlier this year of video-sharing utility Qik have also left. They are Qik founder Ramu Sunkara and senior vice president Allyson Campa.
Sooo... on what basis do we conclude that these eight execs engineered the deal? Let's also not forget that these were released in the months leading up to the buyout - it's not like on the eve of the approval they were all fired. I could also make a point of saying we don't *know* that they were fired - as TFA doesn't specify it - but the timing *does*seems awfully convenient if they all de
Employee Loyalty (Score:2)
And executives wonder why there isn't any employee loyalty in a company any more? Perfect example of why the only way to get a raise is to take your skills and get a job with another company.
What's next for Skype? Easy: get rid of the superfluous programmers—you know, the guys that made Skype work—and hire telemarketers at less than 20% of the engineers' salaries to push the new business. Better: I'm willing to bet that this "private equity firm" owns a marketing business, which will soon get a
Fired? (Score:2)
They probably got a good pile of money in their pockets anyway
Also, from the same site: http://www.itworld.com/unified-communications/166637/5-skype-alternatives-linux-users [itworld.com]
While many people use Skype for its free voice over IP (VoIP) services, Linux users have a love/hate relationship with it. Yes, Skype will run on some versions of Linux, but it doesn't run on all of them, and the Linux version (2.2-beta) lags far behind the Windows version (Skype 5.3). That's three major generations behind. Need I say mo
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Jackass, rat's ass, fat ass, hairy ass, who GIVES a shit?
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No, it's not.
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Fortunately they only took out themselves in a single-vehicle crash and didn't kill any other innocent motorists.
I definitely agree with this.
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Not that the executives can't sue but they normally have contract that may allow the company to do these things. However the details of the contracts are important. The articles seem to suggest that by removing these execs, the parent company saves a lot of money as the executive stock options that the execs would have gotten either go back to the company for free or extremely reduced cost. That is, unless the contracts stipulate other terms.
Actually, the submission, not TFA, says that. The article only says they left with no reason given for why. Quite frankly, if they were so high up that their departure wasn't noticed and they didn't have a solid employment contract to protect themselves I'd be surprised. While I am not a lawyer my experience with employment law tells me if they were fired for the reason given in the submission there'll be lawsuits and settlements forthcoming. Employment law, in the US at least, changes with each court case
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Agreed (Score:3)
If the situation is what the summary suggests, the execs will sue them and the investor will end up paying legal fees AND whatever their obligation would have been had they not been fired.
Fired is clearly speculative (Score:2)