(Originally posted Jan 18, 2009)
Yes, the world hasn't ended. The economy is still not completely in the toilet. But some early signs are coming...
- Google had a layoff - the big G has laid off 100 HR folks. Makes sense, since they aren't hiring. they've also shut down their recently opened Austin office.
- Steve Jobs is sick, and has taken 6 months off. Apple stock got clobbered as a result. And suddenly the prospect of a religion without its chief prophet has become all too real
Ouch.
GM - October sales have fallen 45%
Ford - down by 30%
Toyota - down by 23%
Honda - down by 25%
Given how bad terms for financing are becoming, new car sales will probably take some time to adjust back up. On the other hand, people selling used cars are probably getting great offers right now.
Car makers are quite good at advertising - it will be interesting to see how they respond, and try to change the market. Look for lots of great deals around the new year!
Razorfish, which Microsoft acquired as part of last year's $6 Billion aQuantive acquisition, is laying off 40 of its 2,000 staff members. The layoffs are all from their New York office, which has lost quite a few clients in the recent economic downturn.
At the same time, Razorfish is looking to expand its presence in Europe, and is buying Wysiwyg, one of Spain's largest online ad agencies.
Add to these two the rumors that Microsoft is looking to sell off Razorfish (which used to be Avenue A/ Razorfish before a recent rebranding), and you have an enigma wrapped in a conundrum.
The rumors around Razorfish's potential sale have quite a bit of meat to them. Add to them the following facts, that bolster the rumors:
a) Microsoft was really looking to buy aQuantive, in response to Google snapping up DoubleClick. Razorfish came as part of the package, and didn't really fit with Microsoft's overall strategy.
b) Microsoft puts almost $250 Million a year into digital advertising. You read that right! And they use other agencies, mainly (as far as I know) Universal McCann for a lot of their digital media plans. Now, if Razorfish was strategically a fit, wouldn't this be different?
c) Razorfish represents a broad spectrum of clients. But they aren't really selling them on advertising on Microsoft pages front and center. That stands to reason - without objectivity, Razorfish would not be able to keep their clients for very long. But then how does it serve Microsoft to keep them around?
I keep forgetting the NBA is a business. But the folks working at NBA headquarters, and league offices around the country do know that. The Charlotte Bobcats, who have probably the league's stingiest ownership after the L.A. Clippers, laid off about 40 people from their marketing and business department, and three front office executives. And the NBA asked some people to leave, too.
Wow
The original rumors were wrong. (See my original blog post). Yahoo is cutting 1,50o people (10% of their workforce) instead of 3,500.
But I feel Yahoo is wrong - they should clean house a bit more, get rid of the people who no longer want to be there. And then hire new high performers - they will be among a smaller set of companies hiring in this economy.
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