Photo: http://www.flickr.com/photos/scobleizer/ / CC BY 2.0

In January 2009, for the first time in its history, Microsoft Corp. announced it would cut some 5,000 jobs over the year as the company witnessed a drastic decline in revenue. The company suffered an 11 percent drop in profit, leaving many Microsoft workers unemployed and in need of short term loans. However, according to several news reports, it appears this trend will only continue for Microsoft.

Microsoft Layoffs – Another 1,000 Down

According to Seattle’s Tech Flash News, Microsoft will lay off almost 1,000 employees as part of its budget cutting. Apparently, the plan to cut 5,000 jobs is not yet over. This wave of job cuts, however, is said to be part of the final phase of the company’s initial plan to cut 5,000 jobs over a period of 18 months. This time around, however, employees at Microsoft will not be as fortunate.

Earlier this year, during Microsoft’s massive layoffs in January and May, laid off employees were able to find other positions within the company. Unfortunately, with limited job openings and slow growth, people will have to go somewhere else to find employment.

Falling Revenues

Last month, Microsoft posted its quarterly revenue at $12.92 billion, down $730 million from the amount reported in its third quarter ending March 31, 2009. With the help of the Windows 7 launch and a steady demand for Xbox, the company says its revenue would have been $14.39 billion and earnings would have been 52 cents, up 8 percent, according to Tech Flash. However, through advance sales and negotiations, the key strategy behind the Windows 7 launch deferred about $1.5 billion in revenue from the quarter. According to accounting rules, customers must first be given an opportunity to actually get the final product they bargained for before the company can recognize the revenue.

The Unemployed – What can you do?

Since the beginning of the recession, the unemployment rate has been climbing significantly. More and more people have fallen in need of short term loans and debt relief. But what else can be done to alleviate the amount of stress and financial worries during such a trying time of need? Save, sacrifice, and safeguard; that’s what.

Sidekick image from Wikimedia.

Last week, one of the biggest tech companies in the United States experienced a server outage. Several Sidekick smartphone owners lost personal data such as appointment dates, phone numbers and other information when Microsoft’s server went down a couple of weeks ago.

Data services for Sidekick users whose information was stored on a Danger server went down completely Friday, Oct. 2, and slowly returned over the weekend. Three days after the server outage, Microsoft sent a message to users that said “Affected customers should not remove or ‘hard reset’ their device, doing so may cause Address Book and Calendar information to be lost.”

Woman sues over lost data

Naturally, for many, it was too late. All the guaranteed payday loans in the world can’t make a person’s digital contact list reappear, and an Atlanta woman has filed a class-action lawsuit against Microsoft and Sidekick maker T-Mobile, saying:

Defendants negligently failed to invest the resources, including hardware, software, procedures, maintenance, security, back up procedures, and the training and testing necessary to insure that the functions and operations Defendants assumed would operate to permit Plaintiff and the members of the Class to access and keep safe and secure that data they entrusted to Defendants.

The woman who filed the suit is Maureen Thompson from Atlanta. She says her daughter, an aspiring singer and model, lost appointments, business contacts and song lyrics she had stored on her phone. She filed the lawsuit in U.S. District Court for the Northern District of California and invited any other negatively affected customers who wished to seek damages to join.

Microsoft’s predicament

Microsoft has managed to create products and services that people “need,” which has made the company very, very rich. But as we learned from Spider-Man, “With great power comes great responsibility.”

Microsoft’s ability to develop products that people rely heavily on has made it one of the most powerful companies in the world. Microsoft and other high-tech companies have completely changed the way people conduct business and communicate. I think this lawsuit is going to be tough for Microsoft and T-Mobile, because their only defense will be “You shouldn’t have counted on us.” Not good PR. T-Mobile has issued statements saying the server outage was all Microsoft’s fault.

Will suit be silenced with a settlement?

Because of the damage a trial could do to Microsoft’s reputation, I predict the company will settle the lawsuit out of court. T-Mobile already has offered Sidekick users a free month of service and a $100 gift card. Because the server outage was Microsoft’s fault, T-Mobile might end up getting off the hook.

However, if it’s discovered that the hardware was responsible for data loss or customers were led to believe that the hardware would provide data backup, T-Mobile could end up having to pay damages as well. Both companies can easily afford to pay out-of-court damage settlements to customers, but I don’t think they can afford the cost of the public viewing them as unreliable.

Image from Wikimedia.

When’s the last time someone checked up on the soda wars? Maybe people finally gave up and decided that Pepsi would never be able to beat Coke as the world’s favorite soda.

Pepsi is in good company when it comes to not being able to beat Coke. In fact, as brand names go, no one can beat Coke. Triangle Business Journal reports that Coke remains the most valuable brand in the world. Maybe you should check with them if you need short term loans.

Business time

The Coca-Cola Company is the world’s largest bottler in the world. Also, it’s possible that Coca-Cola has been the most valuable brand in the world for as long as it has been around, but we’ll never know. BusinessWeek and Interbrand began studying and compiling a list of the world’s top 100 brands in 2001, and Coke has held the No. 1 spot every year.

Yes, Coke is sitting pretty as collectively the value of the top 100 most valuable companies in the world dropped 4 percent, but its individual value went up 3 percent in the past year. Yes, even during a recession. The Coca-Cola Company is 123 years old, and it’s based in Atlanta. Its brand value is listed at $68.7 billion.

Big Blue in second place

IBM, worth $60.2 billion, is the second most valuable brand in the world, just edging out Microsoft. IBM headquarters is in Armonk, New York. The Tabulating Machine Company, which ended up becoming IBM, was founded in 1896.
Third place Microsoft is worth $56.6 billion. Compared to two companies that beat it out for most valuable brand, Microsoft is just a baby. Microsoft was founded in 1975 by Bill Gates. The company grew quickly, opening its first international office in Japan in 1978. Microsoft started off in Albuquerque, New Mexico, but now its headquarters are in Redmond, Washington.

General Electric holds its ground

The top five most valuable brands in the world have not changed their rank since last year. Just as in 2008, GE is the fourth most valuable brand in the world. So far, we’re four for four on U.S. companies being the most valuable in the world. GE, at some point, probably beat out Coke as the most valuable brand, but I guess we’ll never know.

GE is just a few years younger than Coca-Cola Company. It was founded in 1892 when Edison General Electric (yes, that Edison) and Thomson-Houston Company merged. This year, Forbes reported that GE is the largest company in the world.

Going abroad

Rounding out the top five is Finnish company Nokia. Though in the United States this company is best known for making cell phones, Nokia has been around a whole lot longer than cell phones have. The company was founded in 1871, making it even older than the Coca-Cola Company, and it was originally a paper manufacturer.

Back in the states, McDonald’s is the world’s sixth most valuable company. Google jumped up three spots on the list this year to number seven. Toyota fell two spots to number eight, which isn’t surprising given the year the auto industry has had. Rounding out the top ten are Intel and, of course, Disney.