Vol. 6, No. 2, February 1995

Year of the boar

Atex, System Integrators start off calendar by laying off almost 100

In the Chinese (and Vietnamese) lunar calendar, the new year doesn't start until the first new moon after the sun enters Aquarius. This year, that meant that Chinese New Year (and Vietnamese Tet) fell on Jan. 31.

Chinese years carry animal designations, and this is the year of the boar -- sometimes known as the year of the pig. And to harken it, suppliers to the newspaper industry had some new year’s news for about 100 people: You're outta here.

Actually, it was just Atex Publishing Systems Corp. and System Integrators Inc. But between them, they took massive hits -- 15 percent of payrolls companywide . The reason? Well, each company had its official statements regarding "restructuring," but the key issue is that we -- the publishing industry -- haven't been buying enough from them for them to keep hundreds of workers on the payroll.

Both companies have been downsizing for years, but these cuts probably are the most meaningful -- if for no other reason than they happened two weeks apart.

I've nattered on and on about this in the past: The industry’s embracing of off-the-shelf hardware and software has meant one thing for traditional suppliers -- less income. Whether you merely elected to buy your PCs from a local supplier or bought the whole system from an integrator (or built it yourself), you probably cut Atex or SII out of a certain amount of operating cash. (Well, you might have done business with someone else, but the point is, you took your cash out of the supplier industry and put it somewhere else.)

The disquieting thing about the cuts at SII is that they are mostly among programmers. Company officials state they have plans for handling the coding tasks these workers formerly undertook (in fact, they emphasize they've cut the development, not the research, in the phrase "research and development"), but I still think there’s something we should think about as an industry:

We've never invested a dime in research and development. And now, as the two bodies we've relied on for R&D -- the Newspaper Association of America and our suppliers -- make cutbacks, we're going to be in a position where we need to do more research on our own.

It won't be organized research. It won't be coordinated research, but it has to happen. Why? Because we're in a "mature" (read "dying") industry, and we've just cut out the only group -- our suppliers -- who had any interest in doing R&D for us.