Lose-Lose Decisions

I wasn't surprised at VA Linux's reorg announcement. The rumors had already surfaced on VA's best known web site, Slashdot, last week.

After some thought, VA's decision to halt making Linux hardware and concentrate on their SourceForge Onsite stuff and their former Bendover (as ex-employees of Andover have nicknamed it) web sites makes as much sense as anything they could do.

Which half should they ax? The hardware or the web sites?

Hardware is a low margin business and with Dell, IBM, HP jumping into the Linux hardware scene, the competition is brutal. Web sites, in this ad starvation time, is a negative margin business. Jetson one or the other and you lower the burn rate. But that only means you'll manage a little longer before you run out of money and have to shutter the doors.

I think it was a case of a lose-lose decision. If they kept the hardware and tossed their money-losing web sites, the hardware side would gone south rapidly. Why? One of the web sites is Slashdot. Do anything to hurt Slashdot and the repercusions will be felt - BIG TIME.

So they decided to chop the hardware. And feed the bandwidth hog Slashdot and its (ex?) millionaires.

Kinda gives new meaning to the old phrase "Damn if you do, damn if you don't".