Spotify reducing employee base by about 6% • Hacker News Board

Re: Spotify reducing employee base by about 6%

#341

Post by lotsofpulp » Mon, Jan 23, 2023, 6:23 PM UTC

bobkazamakis wrote: post #337

lotsofpulp wrote: post #307

Earlier quoted context omitted.

> If you want to destroy productivity, firing people is a sure proof way of doing that. In Spotify’s case, the business not making money, and hence not having a stock price that keeps up with the market, is also a way to destroy productivity. Higher productivity people are probably not going to want to work at a charity.

>Higher productivity people are probably not going to want to work at a charity. Have you seen the things people create in minecraft entirely for free?

Replace with "higher productivity people in an organization like Spotify", which I doubt many people are "passionate" about like they would be Minecraft.

Re: Spotify reducing employee base by about 6%

#342

Post by abeppu » Mon, Jan 23, 2023, 6:23 PM UTC

nytesky wrote: post #160

phamilton4 wrote: post #127

I get needing to keep a company lean and that businesses operate to make money... But most of these recent layoffs really make me feel uneasy. Spotify is a little different because AFAIK they are still operating at a negative net income, but still let's take a look at this. They're going to let go 600 people.. that's maybe an annual 90 million in savings (150k salary). The company's revenue is about 9 billion with -3…

The layoffs aren’t about actually saving the cost of those specific employees. Instead, the threat of being laid off is being used as a stick to bring the remaining employees in line — productivity has been lower the last few years, and leadership has no real way to measure on an individual level or how to improve it, so putting the pressure on employees is a tried and true tactics. Further, they can make lower TC of…

A bunch of the recent layoffs aren't considering individual performance as a primary factor. Whole teams get cut if that project is no longer a priority. Roles get cut as part of a reorg.

When this happens, this doesn't push employees to do anything better; it sends the message that even if you're great at your job, you may be cut because the company changed its mind about what's worth pursuing.

Re: Spotify reducing employee base by about 6%

#343

Post by jjulius » Mon, Jan 23, 2023, 6:23 PM UTC

missedthecue wrote: post #194

jjulius wrote: post #110

Earlier quoted context omitted.

>If they don't have enough work for their workforce, would you still say they're morally obligated to keep writing paychecks? Where does OP say that Spotify is "morally obligated to keep writing paychecks"?

He didn't, hence why my comment has a question mark.

>He didn't...

>... would you still say...

Re: Spotify reducing employee base by about 6%

#344

Post by bastardoperator » Mon, Jan 23, 2023, 6:23 PM UTC

lotsofpulp wrote: post #307

bastardoperator wrote: post #277

Earlier quoted context omitted.

I don't think it is that complex. Who benefits from these mass layoffs? Everyone at the top benefits, and everyone at the bottom suffers. You are spot on when it comes to impact of layoffs. If you want to destroy productivity, firing people is a sure proof way of doing that. To your point, I can't take any executive seriously if they're not self reflecting on their own failure. Mass layoffs should equal a new board i…

> If you want to destroy productivity, firing people is a sure proof way of doing that. In Spotify’s case, the business not making money, and hence not having a stock price that keeps up with the market, is also a way to destroy productivity. Higher productivity people are probably not going to want to work at a charity.

So I guess you really dislike people in the OSS space who are considered the most productive of us all and essentially give all their work away for free, kind of like a charity.

Spotify is a jukebox. You put money in and music plays. It's not a new concept in the slightest capacity. If they haven't figured out how to turn a profit now will they ever?

Re: Spotify reducing employee base by about 6%

#345

Post by napoleongl » Mon, Jan 23, 2023, 6:25 PM UTC

ROTMetro wrote: post #322

karl11 wrote: post #157

Earlier quoted context omitted.

Revenue is irrelevant when looking at savings, you have to look at net revenue or gross margin. Majority of Spotify’s revenue goes to record labels. If you are making -40mm / yr then a $90mm swing is a huge deal. Also, can’t just look at salary - employees cost a lot more than their salary. 10% employer tax, health care, other ancillary benefits, IT equipment / space, etc. A $150k salary probably costs the company $2…

Do Swedish companies pay a lot into health care? Can you recover the cost of the IT equipment already paid for since these are existing employees?

Health care is paid through taxes in Sweden and your access to it is not dependent on your employment. You can have a private insurance (and I assume a company like Spotify does) but it’s mostly for getting access to some private doctors offices with shorter queues to some things. We don’t really have privately run hospitals as the US.

Re: Spotify reducing employee base by about 6%

#346

Post by morgango » Mon, Jan 23, 2023, 6:25 PM UTC

At one point I tried to switch to Spotify for my podcast consumption and quickly found it to be unusable as soon as I had to travel.

They simply are not interested in the podcast consumption features, like downloading the latest X episodes and having them easily available offline. I hope they can figure out that podcast episodes are not spoken word songs that go into playlists.

Re: Spotify reducing employee base by about 6%

#347

Post by lotsofpulp » Mon, Jan 23, 2023, 6:26 PM UTC

bastardoperator wrote: post #344

lotsofpulp wrote: post #307

Earlier quoted context omitted.

> If you want to destroy productivity, firing people is a sure proof way of doing that. In Spotify’s case, the business not making money, and hence not having a stock price that keeps up with the market, is also a way to destroy productivity. Higher productivity people are probably not going to want to work at a charity.

So I guess you really dislike people in the OSS space who are considered the most productive of us all and essentially give all their work away for free, kind of like a charity. Spotify is a jukebox. You put money in and music plays. It's not a new concept in the slightest capacity. If they haven't figured out how to turn a profit now will they ever?

No, it was badly phrased. Rephrase it to mean that the proportion of people that are at Spotify who care a decent amount about competitive compensation is probably pretty high, and so they will be paying more attention to the business’s prospects when evaluating their options.

Re: Spotify reducing employee base by about 6%

#348

Post by lamontcg » Mon, Jan 23, 2023, 6:31 PM UTC

polygotdomain wrote: post #101

I think we've gotten into this weird spot where tech companies are almost goading each other into layoffs. I don't doubt that there was some overexpansion during COVID, but it seems to have shifted. Tech companies have signaled to the market that staffing numbers were too high (regardless of profitability), and that investors want to see them brought back down. These layoffs don't really seem to be an indication of c…

> These layoffs don't really seem to be an indication of company strength

They never were.

I'm old and completely fucking puzzled by this assertion from Millennials that strong companies wouldn't do layoffs.

Re: Spotify reducing employee base by about 6%

#349

Post by WeylandYutani » Mon, Jan 23, 2023, 6:32 PM UTC

qikInNdOutReply wrote: post #317

lotsofpulp wrote: post #307

Earlier quoted context omitted.

> If you want to destroy productivity, firing people is a sure proof way of doing that. In Spotify’s case, the business not making money, and hence not having a stock price that keeps up with the market, is also a way to destroy productivity. Higher productivity people are probably not going to want to work at a charity.

Have you ever seen some of the heavy hitters, programing game engines for open source? These guys do that, cause they want to recover some sanity after programing crap for companies all day. Sorry to say it, but great works will never flourish in some monpolistic mega cooperation with tribal infighting.

Spotify problem is that they are not a monopoly. Competition is brutal in music streaming.

I have no idea if Apple or Google are more profitable? Maybe someone can give an insight.

Re: Spotify reducing employee base by about 6%

#350

Post by alldayeveryday » Mon, Jan 23, 2023, 6:32 PM UTC

bastardoperator wrote: post #319

chitowneats wrote: post #289

Earlier quoted context omitted.

> If you want to destroy productivity, firing people is a sure proof way of doing that. Not as sure proof as paying people to do nothing. Or worse, paying people who are actively working against the interests of the company, intentionally or otherwise.

If I pay someone to do nothing, who is at fault? The person who shows up ready to work everyday or the person who made a bad hiring decision and doesn't have the work for that person? I'm not arguing against layoffs, I'm arguing that the people making the hiring mistakes are not accountable. If I as a CFO give the green light to increase the company's workforce by 10% and two years later make a full reverse, that CFO…

> Most companies employ a board of narcissists that only care about themselves and their wallet

My read is a bit different, in that the board optimizes to the stock price above all, which yes they benefit from but that just means their personal interests are in alignment with the interests of stock holders. I do not blame the leaders so much as I blame the model. Leaders who do not optimize the stock price are quickly expelled. When the stock market was flush with covid stimulus cash, and even before that whilst the market was hot, the name of the game was showing growth. Companies were incentivized to show growth even at the cost of burning cash. Companies took on massive debt and in many cases, either did stock buybacks and/or hired rapidly in an effort to scale their organization for growth. When the market fundamentals changed, and money started swinging back towards safer bets (cash flow positive companies), suddenly the game had changed and leaders needed to react accordingly.

I guess in summary, hate the game not the player.