Wednesday, October 15, 2014

Yahoo starts fresh layoffs in India

Internet firm Yahoo has started a fresh set of layoffs in India, affecting hundreds, as it seeks to consolidate its product engineering teams at its headquarters in Sunnyvale. While senior executives will be offered a position in Sunnyvale, a majority have been handed pink slips, said a source.

India operations will be reduced to support and operations functions. Yahoo India R&D head Hari Vasudev and a few other senior executives have been asked to move to the US. Amit Dayal, vice president of search and marketplaces, has already shifted there.
Ø  Hiring stopped a year ago
Vasudev had taken over from the then Yahoo India R&D head, Shouvick Mukherjee, who himself had moved to Sunnyvale in 2013.
“The writing was on the wall. They’d stopped hiring about a year ago and the layoffs picked up speed in the last couple of weeks,” the recruiter said. Yahoo said in a statement that it will continue to have a presence in India but is looking to consolidate some teams into fewer offices.
In 2002, Yahoo was one of the first multinational corporations to set up research & development in India and others such as Google followed suit. At the time, it was Yahoo’s second-largest R&D centre outside the United States.
Yahoo appointed former Google executive Marissa Mayer to turn around the company’s fortunes in 2012. Under Mayer, Yahoo has bought social networking platform Tumblr, mobile analytics firm Flurry and new aggregator Summly. It also received a $5 billion windfall from the IPO of Chinese ecommerce company Alibaba.
Experts pointed out that a few other companies have moved major product development out of India, including Google, Cisco, Broadcom and Texas Instruments that have shifted parts of their product engineering closer to their headquarters.
Sharad Sharma, former CEO of Yahoo India R&D, said the trend is due to a combination of factors such as politics, changing structure of technology teams and the perception in Silicon Valley.
“It is not acceptable any more in the United States to hire in India at their expense,” said Sharma. Technology teams have also become smaller with each having specialist roles. “The lack of specialists for each team means such teams aren’t getting created anymore and it is affecting India adversely,” said Sharma, founding member of software products thinktank iSpirt.
The success of companies like Apple and Facebook in emerging markets has also created the perception that products for emerging markets can be made from the Valley
Large companies have started focusing on fewer products and that could be one reason, said an industry expert who requested anonymity. The growth of agile product development methodology also requires more and more co-location, he said.

Pari Natarajan, head of market expansion advisory firm Zinnov, however, said that India remains an attractive destination for companies to set up offshore R&D centres.