Channel Brief: More Microsoft Layoffs, Zscaler has Malware Warning Deja Vu

Happy Friday, folks!

After cutting around 1,000 jobs in early June, Microsoft is making even more cuts -- this time impacting employees in product and program management roles.

OpenText, too, announced layoffs, saying it would cut around 1,200 jobs. The company also said it would reinvest in hiring for about 800 new positions in sales and engineering to support its business optimization plan.

Zscaler is issuing an updated warning about the resurgence of Anatsa malware, found in the Google Play Store. Though Google assured users that it had identified and removed all the malicious apps, it seems it has reemerged.

And finally, we're watching the impressive growth of the data center infrastructure and services market, which, according to Statista and Stocklytics.com, is poised for impressive growth over the next four years. In related news, AWS has signed a $1.3 billion deal to build data centers in Australia for the country's intelligence agencies and defense services.

As always, drop me a line at [email protected] if you have news to share or want to say hi!

Grab your coffee. Here's what you need to know today.

Today’s Tech, Channel and MSP News

1. Microsoft Makes Further Layoffs: GeekWire reported this week that, shortly after the close of its fiscal year 2024, Microsoft conducted another round of layoffs that impacted multiple teams and geographies. Microsoft declined to provide details about the number of employees laid off. Posts on LinkedIn from impacted employees show the cuts affecting employees in product and program management roles. Last month, Microsoft cut around 1,000 jobs across the company in areas including its Azure cloud unit and HoloLens mixed-reality organization. The cutbacks come as Microsoft tries to maintain its profit margins even as it spends more on cloud infrastructure needed to train and deploy the models that power AI applications. “Organizational and workforce adjustments are a necessary and regular part of managing our business,” a Microsoft spokesperson said in a statement about this latest round of layoffs. “We will continue to prioritize and invest in strategic growth areas for our future and in support of our customers and partners.” 

2. AWS Will Build $1.3B Data Center for Australian Intelligence Agencies: According to Silicon Angle, Amazon Web Services Inc. (AWS) has inked a deal to build data centers in Australia for the country’s defense and intelligence agencies. The initiative is worth about $1.3 billion over the next 10 years and will support around 2,000 jobs down under. The planned data center cluster, referred to as TS Cloud, will reportedly comprise three cloud facilities and will be operated by a local subsidiary. According to Bloomberg, the TS Cloud will be used to store top-secret data from Australia’s defense and intelligence agencies and will be optimized to facilitate efficient information sharing between them. According to The Register, officials also expect the TS Cloud to enable “greater interoperability and deeper collaboration with the United States.” A third goal of the project is to improve the resilience of the Australian government’s technology infrastructure.

3. Zscaler Warns Anatsa Malware is Back in Google Play Store: A few weeks ago, Android users were warned that 90 dangerous apps with 5.5 million installs had been found on Google's Play Store. The Anatsa malware, according to the Zscaler warning, “exfiltrates sensitive banking credentials and financial information from global financial applications.” Once installed by a separate dropper app, Anatsa scans the infected device for banking apps, captures login details via a fake login page overlaid over the real app and intercepts SMS passcodes. Then it drains your account. Previously, at the time of the initial warning, Google assured users that “all of the identified malicious apps have been removed from Google Play, [and] Google Play Protect also protects users by automatically removing or disabling apps known to contain this malware on Android devices with Google Play Services.” But it seems they spoke too soon -- Zscaler is warning that the malware is back.

4. Data Center Market Poised for Explosive Growth: According to Stocklytics.com, the global data center market is expected to grow by 30% and hit a value of over $430 billion by 2028. The adoption of cloud computing, aggressive infrastructure expansion by major hyperscalers like Microsoft Azure, Google Cloud Platform and Amazon Web Services (AWS), the demands of AI and data storage are all drivers of this growth, according to Statista. The need for data center solutions and technology has helped the entire market grow revenues by almost 40% since 2016, and a Statista Market Insights survey projects that the global data center market is expected to gross over $344 billion in revenue this year, $15 billion more than in 2023. The entire market is projected to grow by a CAGR of 6.5% in the following years, resulting in a market volume of $438 billion by 2028. Statista found that most of that value will come from network infrastructure, the market's largest and fastest-growing segment, followed by data center storage.

5. OpenText Announces Layoffs: OpenText on Wednesday said it would cut about 1,200 jobs, or around 1.7% of its workforce, as part of its new business optimization plan, Reuters reported. The layoffs will cost the company about $44.01 million that will be recognized in the first quarter of fiscal 2025, but OpenText expects to reduce its expenses by C$150 million in 2025, according to Reuters. The Ontario, Canada-based company will reinvest C$50 million annually in 800 new roles in sales and engineering to support its growth and innovation plans, according to an SEC filing.

6. Top 250 Vertical Market MSPs Survey Open: Many of the most successful managed service provider (MSP) businesses specialize in vertical markets -- perhaps your vertical is healthcare, financial services, retail, government, education, or something else. To honor your success in one or many of these markets, each year ChannelE2E surveys MSPs to identify and promote the top companies in each of these verticals. (Check out past years' lists here.) The 2024 survey is open now. Here's the link to participate.

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