Multiple news outlets in Seattle and the tech press report that Microsoft plans to announce a significant reorganization in an effort to refocus its cloud computing division. In the process, a lot of people are going to lose their jobs.
The Seattle Times, Puget Sound Business Journal, Bloomberg and TechCrunch all cite sources claiming that the news could come this week, and that could mean layoffs in the thousands.
The Seattle Times said it was unclear what groups would be affected and where they are located but that the move would be to get its sales teams to emphasize its cloud computing products instead of pushing packaged software.
The Puget Sound Business Journal predicted the news would come Wednesday, July 5, but that has not happened.
The group likely to be affected is the Worldwide Commercial Business group under Judson Althoff and Jean-Philippe Courtois. It’s a part of the global sales and marketing group. Job cuts were expected to be in local markets rather than across the board.
Last September, Althoff told The Seattle Times that Microsoft had had the wrong approach to selling cloud computing products by treating them much like its packaged software offerings and that he planned to change the sales pitch.
“It was a flawed strategy to try to sell Azure like, ‘Do you want fries with that?’” Althoff told the Times.
Microsoft’s recent cloud computing moves
There have already been some moves in this area. At the beginning of June, ZDnet noted Microsoft consolidated some of its cloud computing, AI and data platform business units into a new Cloud AI Platform organization, which would oversee Microsoft Azure and other data science groups.
And the reorganization rumor comes just days after Microsoft acquired Cloudyn, which offers cloud services management and monitoring tools to help companies stay within their budgets. Bills for cloud services, which charge for everything you use, have a habit of running away, and keeping an eye on your monthly usage is a really good idea.
Cloudyn supports cloud services monitoring on Microsoft Azure, as well as Amazon, Google and Openstack. Microsoft did not say if Cloudyn would continue to support the competition, but you’d have to think if Microsoft cuts them off, there will be hell to pay—especially from the European Commission, which just loves to slap Microsoft with billion-dollar fines.
Since Cloudyn is privately held, Microsoft did not disclose what it paid for the firm. It also has not given a timeline for the deal to be finalized or for any work on further integrating Cloudyn and Azure.