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Microsoft Cuts Contractors Spendings by Almost 15%

Posted in Microsoft at 5:17 pm by Dr. Roy Schestowitz

Layoff figures only half the picture

MOST people have already heard about Microsoft's layoffs, but there are related aspects that Microsoft is pretty much concealing, such as those who are on contract (c.f. Abramoff visas fiasco).

Beneath or between the lines, people can find that up to 15% of the contractors (or vendors) might be cut, so the headcount mentioned in the headlines does not tell the full story.

The software maker is trimming costs for travel, freezing wages, scaling back a massive expansion to its Redmond campus and looking to cut what it spends on contractors and vendors by up to 15 percent.

It’s interesting and worth noting that a high executive from Microsoft denied layoffs (in the on-line media) about 2 months ago. He seems to have lied and it’s worth bearing in mind now that Microsoft denies investing in a lawsuit against IBM. In general, Microsoft makes it very hard to trust what it tells the public.

“…Microsoft wished to promote SCO and its pending lawsuit against IBM and the Linux operating system. But Microsoft did not want to be seen as attacking IBM or Linux.”

Larry Goldfarb, Baystar, key investor in SCO

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  1. mpz said,

    January 22, 2009 at 5:45 pm


    Well, as the recent high-profile, extreme company collapses have shown – lying about a public company’s state is no longer a punished crime. And even if a few of those involved in the bigger ones are held to account, the later and smaller ones will probably never be pursued, if only because of lack of resources.

    I can’t get over that some of the reports are claiming it was a ‘shock’ that they didn’t make earnings forecasts – aren’t these people paid to have at least half a clue? All this giving away of windows has to hurt revenue.

    Oh, and in addition to the cuts, a hiring freeze will probably mean the employee headcount will be even lower at the end of the year, even if they don’t announce them as cuts. Although why they wouldn’t is beyond me – the stock market simply loves when a company slashes the slaves head’s off.

  2. Roy Schestowitz said,

    January 22, 2009 at 5:50 pm


    It fell down to $17.

    By the way, they missed already muchly-lowered estimates.

  3. Gentoo User said,

    January 22, 2009 at 5:53 pm


    so the headcount mentioned in the headlines does not tell the full story.

    They also said they are going to hire in some divisions, IIRC.

    It’s interesting and worth noting that a high executive from Microsoft denied layoffs (in the on-line media) about 2 months ago.

    It’s also interesting to note that you have no proof that he was lying, as opposed to simply not being aware that what happened today would happen. Was it Ballmer? Who? Why are not linking to that bit of news?

    and it’s worth bearing in mind now that Microsoft denies investing in a lawsuit against IBM

    That has nothing to do with anything, just in case you are using it as some sort of “Microsoft lies” argument. You recently lied about people working on behalf of Microsoft to “censor” Wikipedia, which that was revealed as nothing more than a smear, so does that invalidate everything you’ve said since then?

    And more importantly, you have no proof that Microsoft is indeed behind the IBM lawsuit, do you? If you do, then why didn’t you provide it in the post you linked to?

    Microsoft makes it very hard to trust what it tells the public

    In general, no different than most of what you say.

    (Note: The lame disclaimer text below is pasted by someone who spends massive amounts of time criticizing software he doesn’t even use)

    Note: comment arrived from a witch hunter that does not even use GNU/Linux.

  4. Roy Schestowitz said,

    January 22, 2009 at 7:53 pm



    “Just how many contractors who work for Microsoft will lose their jobs? Microsoft will not comment. But the tally is probably close to if not more than 5,000.”


    That makes a total that may exceed 10,000 people who lost their job at/for Microsoft, so it aligns with some early estimates.

  5. The Mad Hatter said,

    January 22, 2009 at 10:12 pm


    The problem is that Microsoft, and Microsoft employess continually lie, and both appear constitutionally incapable of not lying. Consider all of the vapor ware that has been announced over the last 25 years where no product was ever released, or the product was released without many of the promised features, and tell me why we should believe them?

  6. Roy Schestowitz said,

    January 22, 2009 at 10:39 pm


    Microsoft has no new projects/products to facilitate a turnaround. Its latest products that are few (Surface, Zune, Vista) are a total disaster.

    As for those people whom Microsoft sacked just now… do they receive a complimentary Surface to take home? I mean, they sit there in the warehouse and nobody touches them anyway. They cost over $13,000 each.

    “We feel a huge threat from Linux” — Jim Allchin

    “I am Scared [of GNU/Linux]” — Jim Allchin

    Replying to “who is Microsoft’s biggest competitor now, who would it be?” said Ballmer: “Open…Linux. I don’t want to say open source. Linux, certainly have to go with that.”

    Ozzie made a similar remark some months ago.

  7. Jose_X said,

    January 23, 2009 at 9:07 am


    >> > Microsoft makes it very hard to trust what it tells the public

    >> In general, no different than most of what you say.

    Yes, whatever the motives for any particular circumstance, both of these two mentioned (and myself and …) make mistakes and say things that end up being incorrect.

    Microsoft should be held to a higher standard for very good reasons, many people pay them very good money, in part, to be precise and provide a certain quality of service to investors and to customers. The standard they are held to is understood to be greater than what applies to BN. The markets and federal authorities treat what is said on BN and what Microsoft say a little differently. Plus, you can usually verify what is discussed on BN as well as BN can, while many of these items discussed that come from Microsoft cannot be confirmed as easily by third parties.

    That said, every company is going to have problems, but this should be corrected as quickly as resources will allow — so maybe Microsoft really is having a cash problem. Their stockholders don’t want to leave any behind to run the show at the standards consumers and various government authorities would like.

    BN would probably consider it a victory if Microsoft was seen just as faulty as some seem to view BN. I’m also sure that if a billion or two was injected into BN, the quality and polish would definitely rise.

    [Don't take this as an insult, Roy. I think you recognize that BN is not polished. It's a "best effort" given the resources available, time pressures, and the goals for the site. I find it extremely valuable, btw. Reading this site is a bit like digging for gems in a muddy field that has them. You will get dirty, but the effort is worthwhile. Anyone upset with any info on any blog posting can complain in the comments section.]

    >> You recently lied about people working on behalf of Microsoft to “censor” Wikipedia, which that was revealed as nothing more than a smear, so does that invalidate everything you’ve said since then?

    I don’t think anyone proved that either of those individuals did not work for Microsoft (“Jimmi” apparently did claim he worked for someone else — is that his real name, btw?), were not associated with Microsoft, or, more accurately, that Microsoft was not behind their work products in some way.

    However, you are correct in saying that Roy didn’t prove the connection did exist and that apparently he was mistaken as to the precise details about who did which edit on that ACPI page.

    Some of the errors have been corrected on that entry. I’m not sure if all have, but the comment section is there for anyone to review and this is mentioned at the top. Is someone willing to pay BN, $50, $100, or more to homogenize that blog posting with the comments more accurately than it stands now. Part of that cash would go so that a BN rep (or Roy since he wrote that piece) review all the comments carefully (and follows the links and does whatever other work is necessary). $100 may be too little to justify the distraction since the comments there already speak for themselves, but I’m just suggestion a figure to get the ball rolling.

    Maybe we can also chip in $50 to Microsoft so that they tighten up the quality of the accuracy and clarity of the information they provide the market.

    Anyone else think this is a great idea?

  8. Roy Schestowitz said,

    January 23, 2009 at 9:26 am


    Microsoft was actually sued for deceiving.

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