Seagate cuts 10% of its workforce

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Unfortunately, it’s not the first time we’ve had to write something like this, and I doubt it’s going to be the last.  Seagate has cut ten percent of its total workforce, which amounts to eight hundred people.  The news comes not that long after rival Western Digital was forced to close one of its factories and lay off 2500 of its own employees, or about 5% of its total.

As a part of its transition into the new year, the hard drive manufacturer also announced that Chairman Stephen Luczo would be taking over as both president and CEO of the company.  CNET interviewed leaving CEO Bill Watkins, who mentioned that the trend in netbook sales is good for the storage business.  Seagate guesses that only 25% of netbooks on the market have SSDs inside, with the rest using traditional rotating magnetic storage. 

Despite the surge in netbook sales in turn driving hard drive sales, both Seagate and Western Digital have had to face facts, and one unfortunate one is letting employees go.  That’s always a difficult decision to make, since in addition to emotional ties, it can shake consumer confidence in a company.  While new products are on the horizon (or in some cases already here, like Seagate’s pretty awesome single platter 500GB technologies), both companies are looking towards a much leaner new year.


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