An Empire Diaries Special Report
February 2, 2023: Software giant Microsoft’s employees recently received an email with the subject line – “Focusing on our short- and long-term opportunity”. It came from the company’s Chief Executive, Satya Nadella. A subject line like that would make any employee think it’s a mail from the boss probably about company strategy, right? It was actually a sacking letter that was shot off to 10,000 Microsoft employees who’ve been serving the Big Tech firm for months or years.
In hindsight, the subject line of Nadella’s shocking email seems like a cruel joke. But it wouldn’t come as a surprise to those following the ways of Big Tech, sans the tinted glasses with which these US-headquartered MNCs are revered and idolised by the mainstream media.
Through the years, these behemoths have been cherry-picking the world’s most talented youths with the lure of hefty packages to expand their business, and eventually booting them out without batting an eyelid whenever they feel like cutting costs.
Take for instance, Microsoft, which was founded by Bill Gates and Paul Allen on April 4, 1975. Apart from the 10,000 employees it has decided to fire by March 31, it had laid off thousands of employees in 2017 in a move it called a “broad reorganisation” of its sales unit. Three years before that, the American company sacked 18.000 people right after acquiring mobile phone manufacturer Nokia’s devices and services business.
The ongoing season of firings is not limited to Microsoft alone. It spans the gamut of tech giants (or tech monsters?) that are ruthlessly scaling back.
AS FLIES ARE TO WANTON BOYS…
Google’s parent Alphabet recently declared it has decided to wipe out about 12,000 jobs, or 6% of its global workforce. Jeff Bezos-led Amazon announced it was showing the door to over 18,000 workers in the US and Canada. Social media behemoth Meta, which owns Facebook, last year issued the pink slip to 11,000 employees, or 13% of its workforce. Microblogging platform Twitter, now owned by Tesla CEO Elon Musk, terminated 50% of its workforce and is planning to make more heads roll. Snap, the parent company of the social media platform Snapchat, threw out 20% of its staff.
HP also said it is planning to axe 4,000-6,000 jobs over the next two years. IBM has joined the firing party, announcing 3,900 sackings, and so has software giant SAP, which is planning to fire 3,000 people.
The list is getting longer by the week. The season of sackings just isn’t ending.
ARE THE COMPANIES
REALLY IN TROUBLE?
The companies have given various reasons to shrink their staff strength. Reduced earnings, economic downturn, sluggish demand, rising spending after the pandemic are pitched as reasons to justify the sackings. But experts say the tech giants were not in very bad shape, after all. They say the companies were sitting on a pile of cash less than a year ago. An analysis done by the Investor’s Business Daily in February last year said 13 non-financial companies in the S&P 500 were sitting on cash and investments worth one trillion dollars. The 13 companies included Alphabet and Microsoft.
Also, some companies such as Amazon India have actually been doing decent business. The smartphone business of leading online store Amazon India jumped 30% year over year in 2022, notwithstanding a drop in the total number of smartphone shipments. There is a positive outlook for the smartphone shipment business this year, with data analysis firm Counterpoint Research expecting smartphone shipments to go up 10% at 175 million units.
However, that hasn’t saved the jobs of Amazon India employees, an unspecified number of whom – so long working from home – were recently summoned to in-person meetings and fired.
SACK AND INVEST:
The dark episode has exposed the double standards practised by these opportunist tech firms. While kicking their employees out, many of them were simultaneously pumping in huge money to expand their business empires.
Two days before announcing the layoffs, Microsoft outlined plans of investing in OpenAI, an artificial intelligence (AI) research lab in the US that owns the ChatGPT app. Microsoft has refused to divulge details of the deal, but reports have claimed that the company was eyeing a $10 billion investment by roping in some other venture firms.
Meta, which owns Facebook, Instagram, and WhatsApp, has also been on a spending spree, including on CEO Mark Zuckerberg’s pet project Metaverse, a futuristic app. However, the efforts have had a rocky start. Meta’s expenses ballooned by over 24% to nearly $62 billion through the first three quarters of 2022, when its capital expenses shot up by 68%, resulting in lower profits.
While critics have blamed Zuckerberg for squandering money, he responded by doing what rogue businesses have been doing over the ages – sack 11,000 employees who had no role in decisions related to overspending and rising costs.
In fact, as we reported in the past, Big Tech firms have been making enormous financial gains by exploiting the so-called War on Terror. In a report released by the international monitor Action Centre on Race and the Economy in 2021, it was revealed that Google, Amazon, Microsoft, Facebook, and Twitter were providing tools to the US military and government to help fuel their war on targeted communities.
Also, many Big Tech giants have been bleeding from cut-throat competition among them. Meta is up against a strong challenge from ByteDance, which owns TikTok, while many Apple device users have been opting out of various Meta platforms after the mobile maker improved its user-privacy protocols that prevented apps such as Facebook and Instagram from tracking users’ online activity.
Similarly, Google is locked in a battle with Microsoft for supremacy over the generative AI space. But that doesn’t mean the tech companies should squarely blame their employees for losing out to business rivals. Policies are set at the management level. The employees just do what they’re told to do. They can’t be held responsible for top-level policies and strategies that go wrong.
CEO SUNDAR PICHAI’S
That the employees are being made to suffer, vicariously one might say, for the wrong decisions taken by the management of technology giants becomes clear from the sacking letter that Sundar Pichai, CEO of Alphabet and its subsidiary Google, shot off to the employees.
“The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here,” wrote Pichai. Here’s the full version of Pichai’s unpleasant message to his staff, which appears under the heading: “A difficult decision to set us up for the future.”
The CEO’s statement appears quite confusing. While the Kharagpur IIT graduate and poster-boy of the corporate world and the mainstream media admits that his decisions have brought the company to such a pass, his future at Alphabet doesn’t seem to be under the scanner at all. Yet, 12,000 employees, who only carried out the top management’s instructions, were thrown under the bus. Such are the ways of the Big Tech world, or for that matter, some multinational corporations that have become so influential in modern times that they dictate governments, powerful institutions and media outlets, and even control our spending and eating habits, as well as our thought processes.
Coming back to Pichai’s diplomacy-laced sacking letter, did the firings happen because the staff were incompetent or shirking work? Well, the email says the opposite. According to him, the employees were “incredibly talented people we worked hard to hire and have loved working with.”
“To the Googlers who are leaving us: Thank you for working so hard to help people and businesses everywhere. Your contributions have been invaluable and we are grateful for them,” Pichai wrote.
In other words, the company sacked “incredibly talented people” who were hardworking, helpful, and made “invaluable” contributions. Are these not the qualities that every organisation looks for and desires among its workforce? If Pichai is looking to apply some balm to soothe the pain he has inflicted on the employees he sacked, then isn’t he adding insult to injury by blatantly using conflicting jargon such as “incredibly talented” and “invaluable”?
The season of sackings has begun to expose the real face of the Big Tech industry, dampening some of the feverish fanfare surrounding technology companies. For all the smooth talk of connecting people and taking freedom of speech and communication to new heights, and breaking down borders, the tech industry is eventually resorting to what other
rogue industries have been doing historically, showing no mercy for their employees.
The problem is that we live in a world where technology has become a religion, and tech moguls are revered as cult figures. In the wake of these shocking mass sackings, it’s time people look at the Big Tech industry with scrutiny and not with awe.
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