Sun Microsystems said today it’s going to cut 5,000 to 6,000 jobs to align its costs to deal with the weak global economy. It’s another sign of how weak the economy has become, and how Sun is still struggling to find its footing after years of cutbacks.
The cuts are likely to fall heavily on an already reeling Silicon Valley. Cuts like this show just how bad the companies — particularly already battered ones such as Sun — are expecting the economic storm to last. The Santa Clara, Calif.-based server maker said the cuts add up to 15 – 18 percent of its work force. As part of the move, the company will reorganize its business groups.
The reorganization will place more emphasis on open-source platforms and the fastest growing sections of the technology market. Sun said the new structure would recognize the importance of software, such as Sun’s recently acquired MySQL open-source database software.
Sun expects to cut costs by $700 – $800 million annually. Total charges will be in the range of $500 – $600 million over the next twelve months. Anil Gadre will move from chief marketing officer to head of the Application Platform Software division, which includes Java and MySQL. Systems Platforms will be headed by John Fowler and include Sun’s Solaris operating system, virtualization software, and other system-oriented software. In the musical chairs, Sun’s current head of software Rich Green has chosen to leave the company.