5 Companies That Had A Rough Week
The Week Ended March 14, 2014
This week's roundup of companies that had a rough week include layoffs at a major storage device manufacturer, a perplexing marketing move by Google, hints that retailer Target wasn't so vigilant after all during its massive security breach, more pressure on Apple about working conditions at its supplier manufacturers and a LeBron James tweet that Samsung wishes he had never sent.
NetApp Cutting 600 Jobs Amid Sales Slowdown
Blaming what it called a "constrained IT spending environment," storage equipment maker NetApp disclosed this week that it will reduce its employee headcount by about 600 as part of a business realignment. NetApp, in a filing with the U.S. Securities and Exchange Commission, said the cutbacks would result in a charge against earnings of $35 million to $45 million.
Solution providers said market adoption of NetApp's Clustered Data OnTap systems seemed to be slower than anticipated, and customer transition to flash storage and cloud systems was disrupting business. Growing competition from a number of storage startups is adding pricing pressure on entry-level products, partners also said.
Google Apps Referral Program Raises Questions Among Partners
Google this week launched an initiative that gives a $15-per-seat award to Google Apps customers who refer other businesses to the applications. And solution providers who have asked Google about how it will affect the channel have yet to get any answers. The initiative also offers new customers a $10-per-seat discount if referred by a current customer. Google partners said the move could eliminate sales opportunities for the channel. Partners said they got no advance warning from Google and calls to their connections in Google had not responded.
Google's referral program announcement comes just a week after the company launched an expanded, three-tier channel program (and won a "Came To Win" from us). But it looks like Google is still working to develop a consistent channel message.
Report: Target Staff Ignored Security Alerts
Security staff at Target failed to respond to warnings that hackers had broken into the retailer's IT systems and were in the process of stealing some 40 million credit-card numbers and personal information on 70 million customers.
According to a Bloomberg Businessweek story, Target had installed malware detection software from FireEye that spotted the attackers' malware on Nov. 30 and notified a team of security specialists in Bangalore, India, assigned to monitor Target's IT systems around the clock. But when that team notified security specialists in Target's Minneapolis headquarters, that team failed to respond. The story, based on interviews with Target employees and others with knowledge about the incident, did not provide a specific reason why Target employees allegedly ignored the warnings.
Apple Faces Advocacy Pressure Over Use Of Toxic Chemicals At Chinese Plants
Green America, China Labor Watch and other advocacy groups are bringing pressure on Apple to improve worker safety conditions at supplier factories in China. This week they started an online petition asking Apple to protect workers more against exposure to toxic substances and launched a campaign to encourage Americans to delay purchases of iPhones and iPads. Last month Apple, in its annual review of labor conditions at its global suppliers, disclosed that 137 workers at a factory run by Taiwan manufacturer Wintek were seriously injured when exposed to n-hexane, a toxic chemical used in producing iPhone screens, according to a New York Times story. Apple told Wintek to stop using it. In a statement to CRN, Apple said it requires suppliers to meet or exceed U.S. safety standards when using toxic substances and it conducted 200 factory inspections last year.
Lebron James Complains About Mobile Phone He's Paid Big Bucks To Endorse
NBA superstar Lebron James complained Wednesday on Twitter that his phone had "just erased everything I had in it and rebooted," and called it "one of the sickest feelings I've ever had in my life!!!"
Problem is, according to a CNN story, the phone was presumably the Samsung Galaxy Note that James is paid a lot of money to endorse. James quickly deleted the tweet and shortly after tweeted: "Close call. Wheew! Got all my info back. Gamer! Lol."
Not close enough, Lebron.