Microsoft’s GitHub fires almost half of India workforce; ad-based OTTs set to take off

Also in this letter:
■ MakeMyTrip to use generative AI for core capabilities
■ ETtech Done Deals
■ After layoffs, Meta to lower bonus payout

140 people fired at Microsoft’s GitHub

Microsoft-owned code-sharing and publishing service GitHub has fired about 140 employees or 45% of its total Indian workforce, sources in the know told us. The layoffs have mainly impacted engineering roles.

GitHub’s statement: “As part of the reorganisation plan shared in February, workforce reductions were made today as part of difficult but necessary decisions and realignments to both protect the health of our business in the short term and grant us the capacity to invest in our long-term strategy moving forward,” the spokesperson said.

India market: India is a crucial developer market and a key engineering hub for GitHub. In 2020, GitHub announced the opening of its subsidiary, GitHub India, while also crediting the country for hosting its third-largest community of developers.

In September last year, GitHub also made its developer platform available in India to help boost the startup ecosystem.

February announcement: In an internal memo to employees on February 9, GitHub CEO Thomas Dohmke, said that the company was enacting new budgetary realignments, designed to protect the short-term health of our business “while also granting us the capacity to invest in our long-term strategy.”

“Unfortunately, this will include changes that will result in a reduction of GitHub’s workforce by up to 10% through the end of FY23. A number of Hubbers will receive notifications today, others will follow as we are re-aligning the business through the end of FY23. The hiring pause that I announced on January 18 remains in effect,” this memo added.

Also read | Layoffs in 2023: Accenture, Indeed, Amazon among latest firms to cut jobs amid economic turmoil

Ad-based OTT business to get fillip from diverse content, new users

Growing internet usage, diverse content, and new users from small towns will fuel the rapid growth of the advertising-based video-on-demand (AVOD) streaming business, while subscriptions may face sluggish growth with consumers becoming cost-conscious, industry experts told us.

Spurt expected: TAM Media, a television audience measurement analysis firm, has projected that AVOD’s share in total digital ad spends will be almost 40% in the next five years from 29% now.

The AVOD model’s strengths are now being recognised by Netflix and Prime Video, with the latter launching ad-supported miniTV in India, and Netflix offering an ad-supported tier in select markets for price-conscious customers, the experts pointed out. MX Player, AltBalaji and Telugu-Tamil streaming platform Aha are some of the other AVOD platforms.

Expert view: “India is a price-sensitive market, where the hybrid model allows consumers to explore and experience the platform without paying any price. It enables the brand to reach a larger audience base and facilitate sampling to gauge consumer preferences and behaviour,” said Manish Kalra, chief business officer at ZEE5 India.

Market size: According to a recent GroupM report, the size of the digital ad market is projected to jump by 20% to Rs 82,542 crore in 2023 over the previous year. Digital is expected to corner 56% of total ad spending this year.

Meanwhile, EY media and entertainment advisory leader Ashish Pherwani said the AVOD market size will reach Rs 25,000 crore to Rs 30,000 crore in the next five years if premium sports remain free.

Will use generative AI to build core capabilities: MakeMyTrip’s Deep Kalra

Online travel portal MakeMyTrip will build core capabilities using generative artificial intelligence (AI), and work with leading players in the space to build those tools, the company’s founder and chairman Deep Kalra said on Tuesday at the Times Network India Digital Fest.

Quote, unquote: “The new model of AI that we’re all aware of is generative AI. The generative model is heady; and it can summarise the reviews we’re getting intelligently in a very easy-to-understand form to help us build content in a very interesting manner. So, we are working to build those core capabilities, and will be working with the leading players for that,” he said.

The hype: Generative AI models such as OpenAI’s ChatGPT and Google’s Bard, which have taken the tech world by storm, can answer complex questions, write codes and generate content using large language models that take simple-text inputs for human-like responses.

On Friday, union IT Minister Ashwini Vaishnaw said India could expect a “big announcement” on the Indian equivalent of ChatGPT in a few weeks.

Also read | ChatGPT, Bard & Ernie: the three musketeers of AI

Game-changing tech: Kalra said technologies such as data science, machine learning, and artificial intelligence have been “game-changing” in terms of the features that MakeMyTrip has been able to build.

“It has to be a win-win for all the stakeholders — on the one hand, our consumers, and on the other our supply partners, which are airline, hotel, bus operators, etc,” he added.

ETtech Done Deal

Nimbbl raises $3.5 million in funding from Sequoia, Groww, others: Checkout solutions provider Nimbbl has raised $3.5 million from Sequoia Capital India, Global Founders Capital (GFC), and stock brokerage firm Groww. Sequoia Capital India led its seed round, which first closed in July 2021. Nimbbl raised additional funds earlier this year, led by both Sequoia Capital India and Groww. GFC participated in both funding rounds.

pi Ventures raises Rs 22 crore from Belgium-based Colruyt: Early-stage venture capital fund, pi Ventures said it has raised Rs 22 crore ($2.7 million) from Colruyt Group India, an engineering arm of Belgium-based retail corporation Colruyt Group. The fundraising at pi Ventures has helped it nearly hit its final close, in the range of Rs 675 crore to Rs 750 crore, founding partner Manish Singhal told ET.

Last week, Indian startups saw another muted period of funding. A total of $87 million was raised across 12 rounds in the period between March 18 and March 24, according to data provided by Tracxn. This represented an 86% dip in funding compared to the same period last year, when startups raised $609 million.

Tweet of the day

Meta plans to lower bonus payout for some employees: report

Facebook parent Meta Platforms Inc is planning to reduce bonuses for some of its employees, while also conducting an additional performance review, a WSJ report has said, citing an internal memo.

The cut: According to the report, employees who get the rating ‘met most expectations’ will receive a 65% bonus, as opposed to the 85% the company had planned earlier. Employees are due to receive the bonus and restricted stock in March 2024, the report added.

On way to efficiency? Earlier this month, Meta CEO Mark Zuckerberg dubbed 2023 as the year of efficiency. While announcing 10,000 additional job cuts, Zuckerberg also talked about his intent to make the company ‘leaner’ and ‘flatter’, in a blog post. The Facebook founder also hinted at shuttering lower-priority projects while removing multiple layers of management.

Slashing the workforce: A layoff wave has swept tech companies across the globe and Meta is among companies that have slashed the most jobs. The social media giant has cut 21,000 jobs across two rounds — 11,000 last November and 10,000 earlier this month.

Today’s ETtech Top 5 newsletter was curated by Gaurab Dasgupta in New Delhi and Siddharth Sharma in Bengaluru. Graphics and illustrations by Rahul Awasthi.