Why netbooks are killing Microsoft
When Microsoft laid off 5,000 people in January, analysts and pundits pointed to plenty of reasons for the first major layoffs in the company’s history. The obvious culprits included the overall economic meltdown, Apple’s continued success and Wall Street’s desire to see a leaner Microsoft.
But the real cause of the layoffs can be summed up in a single word: netbooks. These lightweight, stripped-down laptops that sell for between $200 and $400 have taken a big chunk out of Microsoft’s bottom line.
Unless the company comes up with a plan to handle them, its revenue will stagnate. In announcing the layoffs, Microsoft said that its revenue had increased an anemic 1.6 per cent in the quarter that ended 31 December compared to the same quarter a year earlier.
