“Dell plans to cut more jobs than the 8,800 it had targeted as it seeks to reduce expenses by at least $3 billion annually by 2011, Chief Executive Michael Dell said Thursday,” Reuters reports.
Dell, “will ‘go past’ the job-cutting goal it first announced in May, 2007, the CEO said near company headquarters in Round Rock, Texas, at the company’s first analyst meeting since 2005,” Reuters reports. “‘We are not satisfied with the current state of affairs and are on a mission to fix it,’ said Dell, 43. ‘Every area of the company is being pursued’ for cost cuts.”
MacDailyNews Take: Bad luck with that, Mikey. Hey, here’s an idea: why don’t you just shut it down and give the money back to the shareholders (while you still have money to give)?
Reuters continues, “The company on Monday said it planned to close its desktop PC manufacturing plant in Austin, Texas, and eliminate about 900 jobs there.”
“Michael Dell said the company will end the current year with lower operating expenses than in the previous year. He said job cuts are continuing in the current quarter after 5,500 positions were eliminated, for a net reduction so far of 3,200 jobs when counting positions added through acquisitions,” Reuters reports.
Full article here.
Jim Kerstetter blogs for CNET, “Dell’s issues go a lot deeper than managing expenses, and adding a line of nicely colored laptops and a new ad agency, as Dell has done, won’t make them go away. In short, Dell just isn’t cool anymore, and it probably never was.”
MacDailyNews Take: Forget “probably,” Dell definitely never was cool.
Kerstetter continues, “Tech pundit Nicholas Carr predicted Dell’s current predicament more than three years ago… For people who want to understand how the computer industry works (and how in many ways it’s not all that different from other industries), the column he wrote for BusinessWeek should be required reading. Carr compared Dell’s run in the 1990s to Ford’s early success in the auto industry.”
“Ford was out-innovated by General Motors, which understood consumers wanted style, taste, something that represented who they are. That’s something Apple has always understood about its customers. Even HP got a handle on this several years ago. By 1926, GM’s Chevrolet was taking market share away from Ford. By 1927, Chevys were outselling the Model T,” Kerstette writes.
MacDailyNews Take: Ford vs. GM, Ford vs. GM… hmmm, now where have we heard that before? Oh, yeah, we wrote it first. Three weeks before Carr. He took it in some new directions and applied it to Dell instead of Microsoft, but, of course, he did have the luxury of those three weeks. We guess it’s nice to know he was reading us at least as far back as January 2005. Yeah, yeah, we know: it was all just a coincidence.
Full article here.
Don Reisinger blogs for CNET, “How can a company that sat atop the entire computing industry for so long become a shadow of its former self in just two years? Is it that Dell has had a string of bad luck or did Hewlett-Packard, Acer and the rest finally find a way to take the company down?”
Reisinger writes, “Sadly, it looks like the latter.”
MacDailyNews Take: What’s sad about it?
Reisinger continues, “At this point, Dell is in deep trouble. The company’s stock price has plummeted in the past six months and, although it’s turning a profit each quarter of well over $200 million, its practice of selling computers just doesn’t work anymore.”
MacDailyNews Take: Perhaps our April Fool’s Day article wasn’t a joke, but instead a news item from the future?
“The company may be able to turn things around in retail outlets, but the computer industry has quickly become a commoditized business where a Dell desktop is the same as an equally equipped HP computer. Realizing this, a price war has emerged and so far, Dell has come out on the losing end in many of these battles, which tells you exactly why it’s trying to reduce overhead and maintain costs at a far more manageable level,” Reisinger writes.
“Sadly, there’s not much more Dell can do. In an environment where margins are extremely low and companies are forced to find innovative ways to entice customers, Dell is fighting an uphill battle. And although its revenue has grown, its growth has slowed to a crawl and things may get worse if they ever get better,” Reisinger writes. “Trouble is on the horizon for Dell, and if you ask me, that’s a sad development.”
MacDailyNews Take: Again with the “sad.” Who the hell is sad? We’re having a freakin’ party here! What, does Reisinger still own shares in that mess? If so, we can see the “sad.” Otherwise, who cares? Another dime-a-dozen PC box assembler will take Dell’s place, as has happened many, many, many times before. Only the names change.
Full article here.
[Thanks to MacDailyNews Reader “amex” for the heads up.]