“Simply put, our staffing levels were bloated and hindered our ability to be an efficient and nimble team-oriented company,” CEO Owen Van Natta said in a statement. “I understand that these changes are painful for many. They are also necessary for the long-term health and culture of MySpace. Our intent is to return to an environment of innovation that is centered on our user and our product.”

“MySpace grew too big considering the realities of today’s marketplace,” said Jon Miller, News Corporation’s (NWS) CEO of Digital Media. “I believe this restructuring will help MySpace operate much more effectively both structurally and financially moving forward.”

The news follows a report by market research outfit comScore (SCOR), indicating that Facebook has surpassed MySpace in the U.S. market as the top social-networking site.

Below, CEO Owen Van Natta’s all-hands memo breaking the ugly news.

Everyone,

Today we are making a number of changes to MySpace’s domestic organizational structure. For the long-term health of the company we are making some very tough, but unfortunately very necessary decisions.

We are reducing our workforce from 1,420 employees to 1,000 – all divisions within the company are affected by this restructure.

These decisions are difficult for everyone, but especially for our friends and colleagues who contributed to MySpace’s success and are directly affected by the changes. Through no fault of theirs our company’s size became unsustainable. The future success of MySpace is dependent upon us operating as a nimble and entrepreneurial company with the adaptive mentality of a start-up.

I believe this is the first difficult step toward a major turnaround – a step that will not only shore us up in the short term, but position us for long term success. We need to become a more innovative company. Becoming more innovative is an ongoing responsibility for all of us, not a one-time effort. We are developing a process that will empower anyone in the company to contribute ideas and enable us to integrate your thoughts into our plans for the future. We will follow-up with details on this process in the coming weeks.

This week we will communicate the foundation for our company strategy. In the days ahead, I will visit a number of U.S. offices, starting tomorrow at HQ, MySpace Music, and El Segundo. On Thursday I look forward to seeing everyone in Seattle and San Francisco, and on Friday, I’ll be spending time with the team based in New York.

I’m honored to be working with you on the next phase of MySpace and I’m grateful for your patience during this difficult process.

Thank you,
Owen

With revenue in its electronic measurement unit down roughly 30 percent from 2008 to the lowest level in Agilent’s 10-year history, the company had little choice but to “resize” that business. “For Agilent to realize its full potential, we must have a financially healthy company and a solidly profitable Electronic Measurement business,” said Bill Sullivan, Agilent president and chief executive officer. “We will move quickly to resize the EM businesses to the new business levels, align resources to the best market opportunities, and position the company for the new economic environment. We have been very aggressive to date in addressing the downturn in electronic measurement markets. However, business remains severely depressed, and there are no prospects for a meaningful recovery in the foreseeable future.”

Ugly news, especially since “foreseeable future” translates to “until 2011-2013,” according to Agilent (A) CFO Adrian Dillon. “We don’t expect (demand) to come back any time soon, so we’ve got to fundamentally change the cost structure,” he told Reuters. “We will not see a 2008 level of activity at least for two to four years.”

[Image credit: someecards]

“While it’s horrible that people are out of jobs, I think it’s good for the nation long term; I think it’s good for this industry, the semiconductor industry; I think it’s good for the valley.”

– National Semi CEO Brian Halla, March 8, 2009

To see just how badly the continuing erosion of consumer confidence is affecting the chip industry, one need only look at the pitiable state of National Semiconductor (NSM). After announcing third-quarter revenues that were down
31 percent from the previous quarter and 36 percent from the same period a year earlier, the company said today it would sack more than a quarter of its workforce. In the months ahead, National Semi will close two facilities and eliminate 1,725 jobs.

A brutal cut–so brutal, in fact, that you’d think it might compromise the company’s ability to properly service its market. Yet with current quarter sales expected to fall five to ten percent sequentially, CEO Brian Halla says it’s a necessity. “The worldwide recession has impacted National’s business as demand has fallen considerably,” said Halla. “The actions we announced today will help us remain competitive.”

And don’t forget, they’re good for the nation and for the industry… long term. For those affected by them, not so much.

A surprising turn of events. Because as recently as Friday, it seemed very much business as usual for Watkins, who had the uniquely unpleasant task of announcing a forthcoming round of layoffs while at the Consumer Electronics Show last week. “We are going to announce another round, and we think we’ll do it in January,” he told Bloomberg on Jan. 9. “There will be restructuring, and there will be some layoffs.”

And, indeed, it appears there have been. Not only has there been an abrupt change in leadership, but according to a new filing with the SEC, Seagate plans to sack about 10 percent of its U.S. workforce as part of a restructuring plan that “will impact a broad range of departments, including research and development.” It is, of course, “being done in response to the current economic environment.”

Sun shares are trading up on the news. That said, they’ve been trading higher for a few days now, inexplicably up about 20 percent versus Nasdaq, which isn’t doing nearly as well.

Odd, that, isn’t it?

Over at Mini-Microsoft, the Redmond insiders who frequent the site’s comments are incredulous over the layoff rumors, insisting that they are baseless. Costs will be cut, they say, but they will be cut through attrition and reduction in open headcount. “For the last time folks–THERE ARE NO LAYOFFS HAPPENINGS IN JANUARY,” writes one Mini-Microsoft commenter. “Beyond Jan…well we dont have a crystal ball–but if the economy doesn’t improve and the company misses targets–it would get uglier for everyone–from no raises/no bonuses to (maybe) cutbacks/layoffs… but then, those are the rules of the game in corporate America.”

Now, Mini-Microsoft is not an official company blog, and it’s penned by an anonymous author. So the layoff rumor it’s floating should be viewed as just that, a rumor. That said, the blog has long been a clearinghouse for internal information Microsoft would much prefer to keep under wraps–and a fairly accurate one at that. So it’s certainly worth paying attention to. As Joe Wilcox writes over at Microsoft Watch, “When Mini speaks layoffs, I believe.”