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The rush to PC commodity continues.

DELL will let go of 8,000 workers over the next year; 10% of it's workforce, and those layoffs "would vary across geographic regions and customer segments to "reflect business considerations as well as local legal requirements.""

Does Nashville have a 'local legal requirement' that would prevent layoffs from affecting local layoffs?

From Nashville BizJournal, in 2002:

Austin, Texas-based Dell employs about 3,400 people in Middle Tennessee. The company manufactures its Inspiron laptop model in the 300,000-square-foot building in Nashville. A 360,000-square-foot office building nearby houses Dell's technical support call center and sales operations. The company also manufactures its Dimension desktop model at a 260,000-square-foot facility in Lebanon.

The 1999 deal that brought Dell to Nashville was criticised by many for it's lucrative ($166 Million) Incentives Deal, pushed by then-mayor now-Gov. Bredesen.

The Nashville-based newspaper published an analysis a month before the final Metro Council vote that found that when the "indirect costs" associated with the Dell operation (e.g., schools and other city services) were added to the incentives, total costs over a 40-year span outstripped new local tax revenue by roughly $74 million (in 1999 dollar values).

The mayor blasted the newspaper's analysis. The Tennessean, Bredesen asserted, had found that the city wouldn't financially benefit from the Dell deal even if all the incentives were removed.

The Tennessean fired back in print that its analysis of the deal hadn't removed the incentives from the equation. Then, in response to the mayor's comments, the newspaper did analyze the deal without the incentives.

What that Tennessean analysis concluded was that the city would show a net gain of $30 million-plus over the 40-year period if Dell paid its full share of property taxes and didn't receive other location incentives. (The Dell deal provides both location incentives and a 40-year property tax exemption.) In addition, The Tennessean calculated that if Dell paid its full share of property taxes but still did receive the other location incentives, the city would realize a net benefit of roughly one $1 million over 40 years.

The big difference in the analyses by the mayor and the newspaper seems to be the costs involved in providing city services to Dell-related employees. Bredesen puts that cost at $46.6 million over 40 years; The Tennessean estimates that the cost will be some four times higher.

I guess the Governor didn't really expect PC prices to plummet, and the industry to be as downward-volatile as it's proven to be.

How could he? After all, Computers are always gonna be expensive, aren't they?

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