Google drops the Axe on 4,000 Motorola Employees
Motorola employees on Sunday received the word that Google will be cutting a significant amount of the workforce in its expected revamp of the company it acquired. The news came as the U.S unemployment rate has been on a rollercoaster ride and currently sits at 8.2%.
Google has vowed to provide severance packages and help for employees to find new jobs. This will come at an estimated cost of $275M to the company, but may go even higher than that. The cost cutting measures are being deployed to turn around the mobile business unit which will focus on integrating the droid platform and building new devices to compete with Apple and Samsung.
The job cuts will have a global affect with a third of the lost jobs in the U.S and a third of Motorola’s global offices being closed. Recent weeks have had Google closing a number of its business units and developments in what would seem to be slimming and thinning, reorganization of the company.
With the iPhone 5 expected to launch next month and Google being snubbed from the iOS6 development, it seems clear that Google will be making an effort to create a competing solution. In order for Google to compete with Apple and Samsung it will need to bring to the market something new, exciting, and different that will create a wow factor in the crowded space.
It will remain to be seen if becoming a rival in an iPhone dominated market will pay off. So far droid has gained a significant share and provides a good open platform for app development as well as for hardware manufacturers. Though the adoption of Droid OS may change with hardware manufacturers as Google begins to compete in the hardware arena with its own platforms, it’s hard to say if manufacturers will see Google as a threat or ally.