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Monday, September 15, 2008
HP cutting almost 25,000 jobs
Hewlett-Packard Co. Inc. just announced it will ax 24,600 jobs or about 7.5 percent of its worldwide workforce as it digests its mega-merger with Plano, Texas-based EDS Corp.
HP CEO Mark Hurd, who briefed analysts on the restructuring at a meeting this afternoon, isn’t saying specifically where the jobs cuts will be made, but said nearly half of them will be within the United States.
EDS and HP are both huge employers in Texas, and HP also has a large sales, service and marketing operation in Atlanta, Georgia.
Palo Alto, Calif.-based HP completed its $13.9 billion, or $25 per share, purchase of EDS last month. The deal was the second-largest buyout ever in the high-tech industry, behind only HP’s 2002 acquisition of Compaq Computer, which was based in Houston.
Since the EDS deal was announced earlier this year, workers and Wall Street have been bracing for the fall-out.
Monday, it finally came down. And hard.
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Best Buy buys Napster
Best Buy Co. Inc. has agreed to buy Napster, that badboy pioneer of music downloading, for $121 million.
Under Monday’s morning’s deal the electronics retailer will get the company’s 700,000 subscribers, its CEO and other top managers.
Best Buy plans to use Napster to help it sell music, movies and other media over the Internet. It’s especially interested in Napster’s push recently into the mobile phone space.
“We believe Napster brings us excellent capabilities in the mobility space, as well as international operations and an established team of technology experts,” Best Buy Executive Vice President Dave Morrish said in a statement. “We can foresee Napster acting as a platform for accelerating our growth in the emerging industry of digital entertainment.”
Los Angeles-based Napster was founded in the late 1990s by Massachusetts college student Shawn Fanning as a way to share MP3 files with his buddies. The service started the file-swapping phenomenon and spread like wildfire, turning the music industry on its head along the way. (Legend has it that Napster’s name has its roots in Fanning’s nappy haircut).
Though kids liked it, musicians didn’t. In 2001, the Recording Industry of America won a copyright lawsuit against Napster that forced it shut down and pay more than $25 million to artists for copyright violations.
After that, Napster had an on-again-off-again life. It was resurrected briefly by music giant Bertelsmann AG. Then a porn company briefly flirted with buying the company. Eventually, it ended up in the hands of Roxio, which makes music and video replication software.
Napster never really found its way back to prominence. But it did start the music downloading revolution that today is dominated by Apple Inc.
