Citing delays in its proposed takeover by Oracle Corp, Sun Microsystems has announced plans to pinkslip nearly 10 percent of its total employees over the next 12 months.
The plan by Sun Microsystems to layoff nearly 3000 employees is seen by many as precursor of things to come as the company has been making significant losses in recent months.
Details of the decision were disclosed in its filling before the US Securities and Exchange Commission and it believes that layoffs may help it stem the operating losses that it is suffering which currently runs close to $100m a month.
Though the layoffs are expected to happen over the next 12 months, it seems that the process has already started with a Sun spokesperson mentioning that some jobs cuts are under way.
It is interesting to note the Oracle’s plans to takeover Sun Microsystems have run into trouble with the European Commission investigating the issue on possible effects of the deal in hampering competition in the database market.
Incidentally, Sun Microsystems owns the leading open source database solution MySQL, which competes directly with Oracle’s solutions and this has become a major stumbling block for the deal.
The recession is a good time to make cuts it seems. The 3000 job losses are only the start and it is likely that others will follow. Sun Microsystems will ultimately be absorbed by Oracle and the European Commission could well ask the software giant to spin off some products like MySQL.
(The Wall Street journal)