Expecting to taste a red wine and getting a disguised white wine means you're not ready to appreciate a white wine. It's a whole different world so no wonder they found it off.
It would have actually been a better call to stick to white wine, no coloring added, and differentiate only with the label.
What about in 10, 20 years? Photo libraries will keep inflating. Local storage will not. As of now I backup from a SSD Mac. What happens when I don't have a computer anymore?
Interestingly, people don't value "bits" or information. We value moments and emotions and work and art. There's no successful current consumer business model for people to store and backup photos (Backblaze is mainly prosumer).
And so aren't social networks the real backups by now? The redundancy of publishing on multiple services means some photos will stick and the rest will fade, somehow like former printed pictures I guess. Publish it or lose it?
External backup drives continue to increase in size at a falling cost per GB.
It is cheaper and lower latency to store/retrieve a large amount of data locally than remotely, unless you believe that the current glut of "near-free cloud storage" will continue indefinitely. Market cycles suggest otherwise.
> Publish it or lose it
Why do social networks store your photos "for free"?
> And so aren't social networks the real backups by now?
I hope not. I cringe when I see people who treat them like they are. What do you do when your account password gets cracked(it happens to people on Facebook a lot), or the site itself goes away(MySpace)? Also, you're not able to store the images in their original form; I'm pretty sure sites like these will have limitations on what you can upload. I'm not a pro-photographer by any means, but there's no way I could upload a RAW file to Facebook.
So MS Bought Nokia and ~30k employees for ~$7.2 billion last April.
3 months later, MS may now be firing ~half of the Nokia group. The executives who drove that catastrophic deal stay.
What a testament to how disastrous big M&A really is. Is there any large acquisition that succeeded in the last 10 years? I'd feel sorry if I was a Nokia guy there, they pulled out the best non-Apple phone hardware in the last years.
Probably also a good reminder for Blackberry - dont sell yourself and die trying, it actually can't get worse.
>'So MS Bought Nokia and ~30k employees for ~$7.2 billion last April. 3 months later, MS may now be firing ~half of the Nokia group. The executives who drove that catastrophic deal stay.'
My understanding, primarily from friends at Cisco which has its own history of acquisitions and layoffs is that this is roughly standard procedure, catastrophe or not.
Basically, there's always going to be a lot of overlap when acquiring another large company. Loads of people are made completely redundant and things that didn't come out via diligence are discovered.
There's a wait and see period where some people leave, followed by jockeying for position and finally layoffs of people who remain redundant and/or lacked the awareness to pursue either of the former two options.
Obviously, a merger which doesn't pan out would amplify the effect.
What I wonder is how much such a process actually affects the success of these mergers? Do the consultants and banks who assist in these sort of things have a variable to account the back-biting scramble that will take place in each first year?
By the way, survey of mergers found that while most mergers fail, Cisco is an outlier making successful mergers one after another. It is said that Cisco analyzed successful and unsuccessful mergers and does data-driven, evidence-based decision making.
'Cisco figured out that mergers between similar sized companies rarely work, as there are frequently struggles about which team will control the combined entity.'
I recall asking people there about why they didn't acquire certain companies that I thought would make a lot of sense from a technical / product perspective.
The typical answer was right in line with that quote - that Cisco stays away bigger companies that others might try to swallow at high cost.
That they look for logical acquisitions of specific products in the few hundred million dollar range, not billions.
Of the 21 years and 136 Cisco acquisitions with prices on Wikipedia, 14 come in over $1B. The average price overall is $530M, and the average price excluding >$1B deals with $178M.
Cisco has a very different M&A strategy than Google. They add product lines through acquisition, in preference to building internally (if you're on a Cisco team and you're ever given an MRD for a product, the joke goes, quit and start a company to do it instead). As often as not, Google acquires companies to absorb the people. Google typically buys much smaller companies, and more selectively.
I would be very surprised to discover that Google has acquired close to as many headcount as Cisco has. But I don't want to do the research work either. :)
"I would be very surprised to discover that Google has acquired close to as many headcount as Cisco has. But I don't want to do the research work either. :)"
In 2012 Google acquired Motorola Mobility with it's 20,000 employees.
I would argue that Google and Motorola never "merged".
Google just bought out the patents of Motorola and dumped the company away to Lenovo afterwards. There was no merging, no redundant employee elimination process, like in other mergers.
Plus, this number is obviously a large outlier. An actual stats person would just go calculate the figures with the outlier removed- Cisco probably made much larger acquisitions, employee count-wise, than Google in that case.
It's a document that's usually produced by a product management group in a company that outlines (very vague, almost laughably so) the "market requirements" - what users will want/need - for a given feature or set of features.
This is usually handed to developers/designers to come up with a "High Level Design" (HLD) that gives the "how" to the MRD's "what".
It's usually only seen in larger software companies.
It'd be more accurate to say that MRDs are an artifact of waterfall design. Waterfall is out of fashion, and so small companies tend not to use it, but if you're shipping hardware (like Cisco does) it's often more natural than agile.
Disclaimer: I have worked for Cisco, and no longer do so.
Cisco is an engine for buying up small companies, digesting them, and extracting value from their products. It does not really do engineering or create its own product lines. As a result, it has polished the process of buying up companies, and progressively shutting them down while extracting the maximum sales value from the products that company has developed.
The key thing is that this is the core model of Cisco's entire business. It's actually not too rough on the people involved - the profits of the milking machine are shared fairly generously with the people being milked - but it is all about purchasing products with "potential future value" and converting it into cash, not creating new value.
Usually one of the main reasons you do M&A is that there are redundancies between the organizations. Therefore, being able to lay people off while maintaining the same output is one of the goals of the deal, not a sign of failure.
Ah, perhaps if you're the MBA bean counter type. In reality, you should grow the business, because now you have much better back-office capabilities to support a more distributed, more diverse workforce. Don't be afraid of having lots of people, be afraid of not managing (supporting) them well, causing inefficiency.
You cannot merge 2 huge companies without significant layoffs; there are way too many overlapping job-responsibilities and it's impractical to somehow make that work. Maybe some kind of rare exception is a job that depends on physical location. If I already own a fleet ice-cream trunks in USA and I buy a company in Paris, I'm probably not going to layoff the paris ice-cream truck drivers...
There is a whole lot of overlapping administravia, you don't need 2 full sized legal departments, finance groups, HR group, marketing groups, sales groups and so on. Some layoffs will happen.
Is there any large acquisition that succeeded in the last 10 years?
You might have the wrong criteria for acquisition success. I'm sure both Nokia and MS knew these layoffs would come before they agreed to the purchase.
If that was the case, do you think most of the Nokia employees were actively looking for another job and were just riding the gravy train until it finally pulled into the station?
I would think if I worked at Nokia and we were acquired by Microsoft, I'd probably be looking for another job fairly quickly. Considering the writing was on the wall for a while even before they were acquired by MS.
That will largely depend on the severance packages.
Those who stuck around through the merger and take take the first-round cuts offer will likely make out pretty well. Unfortunately for Microsoft, this means that they're largely paying for people with good strategic skills and a high capacity to find work elsewhere to leave.
It's the ones who stay put, largely out of lack of strategic skills and/or alternative options, who are going to be less valuable to the company. There may be further incentives but they're likely to not be as generous.
If they weren't before, they will be now that Microsoft's layoffs over the next six months hang over everyone's heads. Microsoft should have ripped the bandaid off in one quick move so other employees will feel secure.
Did MS? Including the cost of the lay off ($1.6b says Recode), Nokia price was actually $8.8b. What was their business case that was so easily scrapped just months into the purchase?
It may be successful on a tax/accounting perspective since the purchase was made in € with cash that couldn't be brought to the US.
Yet this does look like a gigantic waste of assets. Warren Buffett says that a successful business is all about mindfully allocating its resources. This looks like the oppsite - no wonder that Nadella has a hard time explaining what happens in simple words.
Adding layoff costs to the purchase price doesn't seem right. Severance is the bulk of it, and that's money you would have paid anyway if you had kept the employees on.
There's no evidence that the initial case for the acquisition was scrapped. On the contrary, it's almost a given that MS was aware of the post-deal costs. This is all quite normal for M&A deals.
Don't underestimate the value of the Nokia brand. Until recently, IIRC, Nokia was the world's largest seller of mobile phones. That brand image is worth a ton to help MS sell its phones.
> Is there any large acquisition that succeeded in the last 10 years?
Yes, many. Think of the Lenovo-IBM deal -- massive success. The Facebook-Whatsapp deal is 2.5x bigger than this acquisition, we'll see how that works out (financially).
Google-Youtube is a big one that can be considered as a big success as well. Ebay-Paypal. FB-Instagram.
It does seem less likely for an acquisition of a large company to be successful than a small one.
The last three you mentioned are all tiny companies acquired for huge amounts of money.
YouTube had something like 60 people at acquisition -- definitely under 100. Instgram had under 20 I believe. Not sure about Paypal but I'm sure it was dwarfed by Ebay.
There is something to that. I think a smaller number of people can be integrated into a larger one, but when two massive companies like Microsoft and Nokia come together, there is bound to be friction.
Not sure what happened with Google and Motorola, but the companies were I think wisely kept separate, whereas it sounds like Nadella wants more "integration synergies".
I don't think madengr is saying that the thinkpad line is not successful. Rather, I bet he means that the modern thinkpads do not fit in with the "thinkpad spirit".
New thinkpads are just like every other manufacturer's laptops, even the X line.
Many of your examples are super-valued acquisitions, paid mostly with stock funny-money, and that employ a few hundred employees at best, which makes them irrelevant to the case here, where Microsoft got 30,000 employees from Nokia.
> Is there any large acquisition that succeeded in the last 10 years?
Lots. Of course, success is relative to for whom -- many of them work out well for shareholders of the acquired firm, many work out okay for shareholders of the acquiring firm, and the executives on both sides usually do well.
Of course, part of how it works out for those groups is that it, by design, doesn't work out well for the "human resources" that are production inputs.
You buy ailing companies and then cut fat. That's the plan, not evidence of a bad decision.
What was happening to Nokia WITHOUT getting bought and gutted? They were in a tailspin and had major internal friction issues getting good tech to the top of the consumer heap. They would be another Blackberry...
Oh wait, you also suggest Blackberry fight it out with their wet noodle of a product line?
As an employee, when you are acquired, you either are indispensable (and will not be made redundant) or you should probably head for the door so you aren't competing with your coworkers for spots when a flood of you are dumped into the market.
Microsoft got the products, IP, licensing deals and will be keeping a block of very productive employees. This is an obvious move and good for MS, MS shareholders, and, indirectly, consumers.
While I am no fan of the deal (to say the least), Nokia would have had to make these deep cuts independently based on the continued inability of Windows Phone to sell enough to support a company of Nokia's size.
Who? The engineers? Clearly many of them would be liabilities as their product lost. Some visionaries are needed, some business people, some engineering leaders, some bright engineers, etc.
Unfortunately, some acquisitions are for talent, others for revenue, others for customers, others for technology, or a mix, and the talent here may be a mix bag.
You seem to not understand how mergers and acquisitions work. There are generally large redundancies which is part of the reason for the deal. Get rid of payroll while maintaining the same total output. Also, a major reason for buying Nokia had to be it's IP. I don't think this is any way a sign the deal failed, and I'm sure it was expected by all of the executives and most of the employees.
The situation is almost reverse in smaller scale companies. It is not unusual for a mid-sized company to acquire another mid-sized or small company, keep the factory workers, engineering, R&D and lay off all mid and senior management (though with pretty good severance usually) to install their own people.
It doesn't make sense for a company that's trying to sell itself to also start making large cuts - it may drive your own price down by signaling that your businesses lack potential. The acquiring company will calculate in the cost (and savings) from the cuts ("synergies", to use the banking term) and just roll them into the purchase price.
So if you're the selling CEO / board, you get to claim you sold the company whole, and if you're the buyer, you just blame the cuts on the increased efficiencies to be gained from combining the companies - it's a sign that the deal is "successful" and you're achieving the synergies you modeled before the purchase.
I think that "we can run this unprofitable business with half its current headcount, thus turning it into a profitable business" is hardly an indication of failure.
You're assuming the unprofitable business will become profitable.
Businesses are never unprofitable because they have too many employees.
Businesses are unprofitable when management lacks the skills, the foresight, or the vision to make those employees profitable.
Edit: If this isn't obvious consider what a world-class entrepreneur could do with 12,000 experienced employees, a couple of billion in severance savings, and a kick-ass idea.
What can you do with 12,000 employees with minimal experience and skills who have been working on a long-standing but now obsolete product line that was manpower intensive, when your business is being completely realigned around other product lines that still make a profit but rely on small numbers of highly experienced staff?
This is not a random question; this company exists.
Very strange comment, I'm sure execs expected all of this when the deal was done. Their expected outcome probably does not look "catastrophic" to them.
Actually, I would say that by the time the deal rolled around the catastrophe had already played itself out at Nokia. It's sad what happened to Nokia, but the acquisition is the least of it.
The whole point of M&A is too eliminate redundancies in the acquired company, so you can drive the same aggregate revenue with lower aggregate costs. Layoffs are not a sign of M&A failure, they are at least neutral, and might be a sign of success.
That could be changing and the US is not the only market that matters. There is a reason Google, Tinder and other companies deny perfectly working apps on the Windows ecosystem and its not because Windows phone is irrelevant.
Lustig's point is that you don't know you're eating sugar when you actually are. Up to 10% corn syrup in white breads, sauces, any precooked meal, sausages. If you eat BBQ sauce, you're eating sugar.
Salt and sugar save low aroma food (>80% processed food). Their combined power on the human body is vicious.
Expecting to taste a red wine and getting a disguised white wine means you're not ready to appreciate a white wine. It's a whole different world so no wonder they found it off.
It would have actually been a better call to stick to white wine, no coloring added, and differentiate only with the label.