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Sun Microsystems to cut up to 6,000 jobs

Sun Microsystems, the troubled US computer systems company, on Friday said it would cut 5,000-6,000 jobs, or 15-18 per cent of its workforce, in the most drastic response yet by Silicon Valley to the economic downturn.

  • By Richard Waters, Financial Times
  • Published: 23:41 November 15, 2008
  • Gulf News

San Francisco: Sun Microsystems, the troubled US computer systems company, on Friday said it would cut 5,000-6,000 jobs, or 15-18 per cent of its workforce, in the most drastic response yet by Silicon Valley to the economic downturn.

Jonathan Schwarz, chief executive, said the company was taking "decisive action to align Sun's business with global economic realities and accelerate our delivery of key open-source platform innovations."

Sun's efforts to rebuild its business model around open-source software, which is distributed free of charge and is open to users to adapt, has failed so far to return the group to profitability.

The aggressive job-cutting comes as Sun faces increasing pressure from Wall Street to accelerate a long-awaited turnround. Southeastern Asset Management, a Tennessee-based fund manager, has built up a stake of more than 20 per cent of Sun's shares in recent months and revealed in a formal filing last month that it may hold talks with unnamed third parties about the company's future.

The fast response to the downturn is in sharp contrast to Sun's actions after the bursting of the tech bubble. At that time, the company resisted the cutbacks that swept Silicon Valley, arguing that it would be well positioned to benefit from a rebound.

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