5 Companies That Had A Rough Week

The Week Ending Feb. 10

Topping this week's roundup of companies that had a rough week is Cisco Systems and its channel partners who were dealing with the fallout from a faulty component found in a range of Cisco products.

Also making the list this week were Intel for losing a key executive in its client and IoT business, Apple for losing a key executive in its enterprise sales operation, Zenefits for a massive round of employee layoffs, and Vizio for coughing up a $2.2 million fine to settle a television "spying" case.

Not everyone in the IT industry was having a rough go of it this week. For a rundown of companies that made smart decisions, executed savvy strategic moves – or just had good luck – check out this week's Five Companies That Came To Win roundup.

Cisco Partners Paying Price For Massive Product Replacement Effort

Cisco and some of its channel partners found themselves scrambling this week to deal with the fallout from a faulty component within some of Cisco's enterprise products.

CRN reported this week that the clock signal component can cause some popular Cisco products, including ASA firewalls, Nexus and Meraki cloud-based managed switches, and ISR routers, to fail after 18 months. Once the component fails, the system will stop functioning, will not reboot and is not recoverable, according to Cisco.

Partners say they are being forced to shoulder the cost for what amounts to a massive product replacement effort.

"This is an issue that could cost the channel community tens of millions of dollars," said one of Cisco's top national enterprise partners, who did not want to be identified. "It is a shock to the system. The clock is literally ticking on these devices ... We have over 500 customers and more than 10,000 devices impacted by this. Cisco needs to step up and take responsibility to fix this from an equipment, installation and cost perspective."

Intel COO Stevenson Leaves Company In Latest Executive Shift

Kim Stevenson, Intel's chief operating officer for its Client and Internet of Things Businesses and Systems Architecture Group has left the company, CRN reported this week.

Stevenson, previously Intel's CIO, had just moved into the role in August, according to group president Murthy Renduchintala, who in a memo to employees said that he found it "difficult to see a strong leader leave" the company.

While Stevenson said in a tweet that she was "on to new adventures," the reasons for her departure were unknown. Intel has seen a number of executive shifts and departures in recent months.

Top Enterprise Sales Executive Leaves Apple

Intel wasn't the only company losing a top executive this week. The executive responsible for leading Apple's charge into the enterprise has left the company after two years on the job.

John Solomon, vice president of enterprise and government, left the company in January, CRN reported this week. His LinkedIn profile lists his current position as "TBD."

Mike Hadley, CEO of Boston-based Apple partner iCorps Technologies, said Apple has "always struggled" in penetrating the enterprise space, and he saw little improvement during Solomon's tenure at Apple.

Zenefits Lays Off Half Of Its Employees

Zenefits, the once high-flying HR and benefits cloud application startup is laying off about 430 employees or about 45 percent of its workforce this week, according to published reports.

The layoffs include about 250 employees in the company's San Francisco headquarters and 150 employees in its Tempe, Ariz., office.

That means the company is down to about 500 workers or about one-third its size when founding CEO Parker Conrad was ousted one year ago. This week's cutbacks are the third and largest round of layoffs to hit the company since then.

Vizio To Pay $2.2 Million Fine In TV Spying Case

Vizio has agreed to pay a $2.2 million fine to settle a case with the Federal Trade Commission and the New Jersey attorney general's office, which charged the television manufacturer with secretly collecting and selling data about customers' locations, demographics and viewing habits, according to the FTC.

The agencies charged that Vizio installed software on its televisions that collected viewing data from 11 million consumers without their knowledge or consent, according to an FTC statement released Monday. The company then "facilitated appending specific demographic information," such as age, sex, income, marital status, household size, and education level, to the viewing data and sold the information to third parties who used it for various purposes, including targeted advertising.

Vizio is paying $1.5 million to the FTC and $1 million to the New Jersey Division of Consumer Affairs, with $300,000 of that amount suspended.