Monday, January 26, 2009

Q4 Earnings Reports Madness

Microsoft, Intel, Google, and Apple's Earnings

A lot of tech companies released their quarterly earnings for the holiday season last week (Amazon's will be released this week), and most of them were unimpressive. I was rather shocked to discover that Microsoft's revenues only went up by 2%, which is $900 million short of their forecast. To appease the investors and shore up their profits for Q1, they have decided to lay off 5,000 workers over the next 18 months, with over 1/4 of those jobs cut last week. They're cutting jobs in several departments, so not just in HR and R&D, but also their software engineers. In fact, the entire Flight Simulator team was let go, which is probably their oldest video game franchise. To make matters worse, Zune revenues dropped 54% year-over-year whereas the iPod gained by a few percentage points. The number is slightly more sad when you find out that 54% means about $100 million.

Steve Ballmer sent out a letter to all of Microsoft's employees about the situation, and I actually really liked the letter. Despite his public antics, I thought that it was really honest and heartfelt, and it pretty clearly laid out that they're handling this weakened economy with a good plan. I'm sure that it was not an easy choice for them to layoff any employees given how much they invest in recruiting smart people. I don't think Microsoft has ever laid off people before, but I guess it just goes to show that even they don't have enough money to save themselves when times get as bad as they are right now.

Meanwhile, Google saw a strong 18% growth in revenues year-over-year. They did see a drop in profits, but it looked like it was due to some investments and not reflective of their actual earnings. Another big article that came out last week, maybe a bit ironically, exposed an e-mail thread circulated among ex-Googlers in which they listed the things they loved and hated about life at Google. Some of the biggest complaints were incompetent managers, a ridiculous interviewing process (with 13 interviews for a single position being normal), salaries lower than competitors, and overall bureaucratic difficulties. It's a good thread that I spent far too long reading, and it's just interesting that no company is perfect. I have a lot of fun at my job, but some days aren't as fun as others and some times pager duty can be terrible. I think what's important is that you feel like you're making a difference with what you do, and I definitely get that feeling and it sounds like even some of these Googlers did. It sounded like some of them joined Google for the wrong reasons: the flashiness of the playground that is their awesome Mountain View office, but it's a lure that few can easily resist so you can't fault them for that. Anyway, if you ever wished you could work at Google maybe that article will help you appreciate some things at your workplace.

Intel saw weak PC sales with a rise instead in Netbook sales (something that hurt Microsoft, as well) causing a whopping 90% drop in profits from Q4 2007. They've decided to rethink 5,000-6,000 jobs, which is my way of saying that they're going to either transfer around or lay off that many people. AMD is cutting 9% of their workforce, about 1,100 jobs. They probably won't cut chip prices much since they're already so low, but it is sad to see so many jobs cut because I wonder how much innovation we'll see in chip-making in this down economy. I guess this would be a good time for AMD to swoop in and dominate Intel or a new player with deep pockets to enter the market.

Meanwhile, Apple's profits only dipped a bit with profits just barely surpassing the previous holiday season (a $100 million growth in revenues from $11.7bn to $11.8bn), which is something that no one scoffs at nowadays. It doesn't help that they're also being investigated by the SEC for their disclosures about Steve Jobs's health, which doesn't mean that Apple has necessarily done anything wrong but just that the SEC is doing their due diligence (possibly due to complaints from disgruntled investors). It is kind of odd that Steve Jobs's health didn't decline until just after Macworld, but it could just be coincidence.

One last thing to sneak in here: it turns out that IT workers got a raise of 4.6% overall in 2008 with an average salary of $78,035. Of course, IT managers had the highest salaries at around $111k, but nearly a quarter of those surveyed to get these figures said that they were concerned about staying valuable to their employers and almost the same number fear getting laid off. Those raises only match inflation, and it's still sad to see my fellow programmers so worried, but I think this economy has affected almost every industry. I look forward to seeing us bounce back together, and I hope that people band together and help each other out. I've been spending a decent amount of spending because of my vacation and my new TiVo, but I've definitely been cutting back on things I might've otherwise done (like weekend ski trips) to make sure I meet my target monthly savings amount.

Obama is President, Tech Stories Galore!

In the wake of Obama's awesome inauguration last week, I actually tagged 6 articles that I'm going to run through here about the start of his presidency and the inauguration. By the way, I really liked his speech. At first I didn't as much as I did some of his other speeches, but I thought he brought in some great quotes and it showed that he's very aware of the current situation and will do whatever he can do to help us bounce back. His faith in our country is just awesome.

Anyway, they had a lot of tech ready for security for the inauguration including a reconnaisance plane, tons of cameras, over a hundred intel teams, and, of course, metal detectors. Google took some pictures of the event from space, also, and the sheer number of people who showed up is pretty crazy.

Obama may be our most technologically aware president ever, and that's apparent in the fact that he asked the chairman of Sun for a white paper on how the U.S. government can benefit from open source software. The average American probably doesn't know what open source means, so the fact that he's willing to turn away money from big vendors to look into free, open-source solutions more widely is crazy. A number of government agencies already have gone open source, but the more the merrier. I personally think that the way to go is a balance of proprietary and open source software, not necessarily 100% of one or the other. His staff is so technologically advanced that they were a little peeved at their lack of communication with the outside world through their new computers. Not only that, but the computers they got were mostly desktops running old Microsoft software rather than the Mac laptops they were accustomed to, and the White House site was not very up-to-date last week. It'll be interesting to see what processes are changed and how much the White House will embrace the bigger social networking sites. They've already taken over the White House twitter account and have started updating it with daily updates.

One last Obama-related article: Read Write Web has an article linking to 7 things you can do online to help Obama "restore America", and I think it's great. Whether or not you were thrilled about Obama getting elected, everyone can agree on getting your finances together and staying informed and stuff like that.

Blu-ray Here to Stay

I've heard several techies counting Blu-ray out already because of how hot digital distribution is, but they're missing the fact that people like owning movies in a physical format. The problem with digital content is that even if you have a TiVo or Apple TV, you have to store your movies on a hard drive or something if you want to keep them, and what if the next big machine doesn't support that? Conversely, Blu-ray players are growing in popularity and the PS3 will be around for a while, and DVDs are still readily playable, so why turn away from hard formats? CNet has a great article talking about this and more as to why Blu-ray is going to succeed. It had a rough start, I know, but this time next year I would bet that things will be very different. The ridiculous growth in HD TV sales, even if they're lower-end TVs, in this economy means that people don't want to cut out entertainment from their budget, and they're going to start noticing that NBC in HD looks a lot better than any of their old DVDs do. Not only that, but Sony is very invested in the success of this format, so they're in it until the bloody end. Until like their past crazy formats, this one has become the de facto for HD video for the forseeable future, and they're going to aim to keep it that way so they can stay afloat.

The Windows 7 Taskbar Beats the Dock

Gizmodo has a controversial article up claiming that the Windows 7 taskbar has surpassed the OS X dock, and I'm sure it has already incited a vast flame war. In the end, this is really a subjective distinction. Still, the fact that it's really vying for people's love of a taskbar is an impressive feat. Whether or not it's better or not is irrelevant compared to the fact that it's giving the Mac a run for its money as far as having a beautiful and functional access bar to applications. Some of the advantages that Gizmodo cites includes Aero Peek to easily see into what the windows have, the flashing colored glass to grab your attention, the scalability to accommodate running a lot of applications at once while still having them be usable, and jump lists (quick access to the most frequently used pieces of an application). They don't overlook the shortcomings (like no text to describe windows), and they just give a great comparison with the OS X dock.

TiVo Review Coming Soon

I just wanted to note that I love my TiVo HD. It's awesome. If my TiVo could talk to me and asked me to sacrifice the Motorola DVR I've been renting to my fireplace in exchange for its continued cooperation, I'd totally do it. I literally set a high priority series recording for Lost and the stupid thing (the Motorola) totally forgot about recording it! There was no competing recording, it just didn't feel like recording it. To the contrary, I was able to set Season Pass recordings for a few shows at work a few days ago for my TiVo and they recorded that very night! I even set one recording from my cruddy Treo phone using their mobile site and had no problems. Not only does it not miss recordings, but it doesn't record every airing like my Motorola incompetently does and it even records shows it thinks I might like (and actually does a pretty good job of figuring this out, to be honest) to fill up some of my free space. While you can't manage your TiVo's recordings online, you can remotely set it to download online content (like video podcasts). There are so many things to talk about that I'm going to do a video review in late February. Why so late? For one thing, I can't get a CableCARD until February 18 because Broadstripe is ridiculous (I'm using an antenna right now, which works beautifully on TiVo for HD network television), but I'm also waiting for my brother to ship me a tripod for my Flip Mino HD so I can record and navigate the TiVo. Some of the other awesome features is that I can transfer videos super easily (and even on a schedule) to my computer, I can use my computer as a home media server to stream pictures and music and transfer videos, Netflix integration, YouTube integration, Amazon Video on Demand integration, Season Passes that work, Wish lists (that also work), great search (again, it's amazing how other DVRs can fail so terrible at this) that works, and so much more. This is one of my favorite devices ever, hands down. It's just that good. This is the kind of living room device I've always wanted - between this and the PS3 I'm completely set for home entertainment (plus my HD TV, of course). What a great time it is to come home after a hard day at work!

I'm going to piggyback on this with Engadget's rundown of all the ways you can access Netflix's HD content, including the TiVo HD, which is one of their recommended ways to access it even though the interface isn't as flashy as it is on the Xbox 360. I think it's interesting how many hardware devices Netflix and Amazon Video on Demand are on (TiVo, Roku, Xbox 360, certain TVs and Blu-ray players, etc.) as opposed to iTunes (iPods, iPhones, Apple TV). Granted, Apple probably has them beat in sheer numbers because of how many iPods and iPhones are out there, but definitely not in diversity of devices. Plus, iTunes videos aren't hosted online, so you can't stream them from where ever you want as many times as you want with Amazon Video on Demand. I wonder if they'll change their tune or even strike up more partnerships?

Final Notes

I'm seriously out of time here. Just a few last things super quick.

Two-thirds of Americans without broadband couldn't be bothered to get it, even with a stimulus package. This is kind of sad: it means that they don't understand what the Internet has to offer to them, and I hope that over the next few years they can learn how the Internet can help improve their lives (and hopefully not waste too much of their time in the process with Internet memes and social networking sites).

The Supreme Court has decided that a 1988 law against providing porn online to minors is unconstitutional. As you can guess: the law is too broad. It just didn't make sense and ended up penalizing traditional publishers who do their due diligence already.

This is a wonderful list of the top 10 Steve Jobs quotes. He was always known for saying insightful things, and even though I don't agree with all his ideas I think that he is one of the greatest visionaries the tech industry has ever seen and will be a historical figure long after his death (which I hope isn't too soon).

YouTube has started adding links for downloading some videos, but so far only on Barack Obama's channel. It's amazing how long this has taken.

Is your ISP net neutral? Test them out.

If you're curious as to how zip codes map out, this is a fun web application to find out first hand.

Enjoy your last week of January, everyone!

1 comment:

Pete Johnson said...

Hey Elton,

It's been awhile, but I saw your post today and liked it a lot. Sounds like Seattle is working out nicely for you, congrats.

I particularly liked your comments on the Google thread. From the outside looking in, it's the hot place to work but obviously even they have issues (as do we and everybody else).

I also enjoyed the link to the broadband adoption issue. I have relatives who are in that 2/3 who don't want broadband and many of them don't even have dial-up and therefore barely understand what I do for a living. I suppose there were those who held out against the telephone too 8).


Pete Johnson
Hewlett-Packard Company
Marketing and Internet Platform Services IT
Portals and Applications Chief Architect
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