In a stunning move, Compaq Computer has laid off more than 100 people in labs in Redmond, Washington, who worked exclusively on porting Windows NT to the Alpha platform. The company has effectively discontinued support of Microsoft's operating system on Alpha.
According to a source inside Compaq West (formerly DECWest), a set of labs used to port Windows NT and 2000 to the Alpha platform, Compaq pulled the plug on NT for Alpha last week.
"Compaq was very clear that Alpha would be used for Linux, Tru64 Unix, and Open VMS," said the source, who requested anonymity.
The source said that the decision came as a surprise to Microsoft officials, and the software giant was considering pulling out the Alpha code currently written into Windows 2000. The dilemma now facing Microsoft officials is what to do with the hundreds of Alpha systems now beta testing 64-bit versions of Windows 2000.
"All of the development is being done on the Alpha, so how can you just pull the plug?" the source said.
The atmosphere inside Compaq West was described as "awful" and "grim" by insiders. Employees are being given incentives to stay on board until the completion of Service Pack 6 for Windows NT 4.0.
Inside the halls of Compaq West, opinions on the reason for the pullout varied from the speed of the Intel eight-way architecture obviating the need for Alpha, to low percentages of NT-on-Alpha users. Analysts concurred with the latter.
"Alpha is the sole survivor of the various RISC implementations, and Microsoft has been getting some mileage out of having [Windows NT] on that platform," said Dwight Davis, a Washington-based analyst at Summit Strategies.
Davis said the timing of Compaq's decision was tricky for Microsoft, where officials have been working feverishly to get Windows 2000 out the door in 1999.
"Alpha as a platform has been very much a niche product anyway, and tended to be a high-end niche product [which is an area] where NT has not been particularly strong anyway," Davis said. "With Windows 2000 around the corner, you would think there might be something of a surge in interest of that system on Alpha.
"This makes me wonder about the prognosis for Alpha," Davis said. "At Compaq there have been major management shake-ups, and this could be something that's fallen by the wayside. It's a very expensive venture and maybe hasn't generated the kind of return Compaq would like to see on it."
The move is not likely to be the last from Compaq. Another employee that preferred to remain anonymous said that Michael Capellas, the newly appointed CEO, addressed the support division last week and expressed dismay at the number of support personnel.
"He was very evasive, but he said that the company would have to study the situation very carefully and make some decisions," said the employee. "He said they were going to have to find out what those people were doing."
Microsoft and Compaq officials did not immediately return phone calls seeking comment.