Native Instruments lays off 20% of its current workforce to reorganize the company and declaring this in an official statement
For several weeks now speculations round in many forums that Native Instruments fired 20% of its workforce. Since yesterday, the Berlin company confirmed this information. It is due to a reorganization of the company as well as realignment in different areas. Of course not nice to hear that such a well-known company has to resort to such measures, especially where you know how small actually such music tech companies are.
Peter Kirn from CDM has written a good article about the Native Instruments lays off where you can learn more. In the official statement, one speaks of a new platform in 2020 on which the company will now concentrate.
In my opinion, Native Instruments will offer its products in a subscription-based system in the future, as this is currently very popular, similar to Adobe or Spotify. So we can rent maybe in 2020 Komplete and Sounds.com bundled in one service for $19.99 or so per month. It would make sense because the bundles are getting bigger and so the musicians no longer have to regularly buy expensive upgrades. This is pure speculations but I think it goes in this direction.
Official Native Instruments Statements
Berlin, August 29, 2019 – Native Instruments, the world’s leading provider of software and hardware for computer-based music production, announced today a plan to centralize their global business operations, which includes a headcount reduction of 20% across all locations. The key reason for this difficult decision is to create the right organizational setup to focus on the development of a new, unified and fully integrated platform on which the company’s entire portfolio of products and services will be available next year. This change comes despite growing revenues in 2018 and the first half of 2019, but as a response to an increasing cost structure due to the company’s previous divisional setup and multi-brand approach.
Global headcount reduction of 20%
As a consequence of the company’s newly centralized organization to focus on its future strategy, Native Instruments had to make the difficult decision to reduce its workforce by around 100 employees across all sites. With most of the affected employees located at the company’s headquarters in Berlin, the departments that were impacted by the consolidation include Sales & Distribution, Marketing & Product Management, Administration and Engineering. All employees were informed about these changes on Thursday, August 29, 2019. The company regrets the impact this has on their employees, their families and the community. In addition to severance packages and outplacement services, Native Instruments has also established contacts with other Berlin-based companies that are currently looking for highly qualified personnel.
“This was the most difficult decision we had to make in our entire history, as our past successes have been enabled by the work of some of the best and most passionate people in the music industry. We thank all employees for their commitment, hard work, and their high degree of loyalty to Native Instruments. We are fully committed to doing all we can to take care of our employees impacted during this difficult time,” said Daniel Haver.
New platform starting in 2020
Recognizing changing customer behaviors worldwide, the aim of focusing on a unified platform strategy is to create an expandable commercial and technological basis for future growth in the digital music production area. For that, a new platform is currently being developed with the goal of offering new ways of accessing the company’s core products and services, as well as complementary ones from third-parties. The centralized platform will also include the company’s expanded portfolio of loops and samples, which is currently part of sounds.com, and will launch in 2020. The company’s previous divisional structure, functional and brand silos, did not allow for a successful implementation of this strategy up until this point.
“Customers today are expecting a seamlessly integrated experience when consuming and accessing creative goods and services. We are confident that we can offer music producers worldwide a unique and premium experience by connecting our existing ecosystem of award-winning software and hardware to a centralized online service,” said Mate Galic, Native Instruments’ Chief Innovation Officer and President. “In the past, we expanded in different product lines, which was also reflected in our organizational structure. Our platform vision, however, requires a much more collaborative approach, having all parts of the company work together towards one common goal.”
None other than Behringer has toppled the layoffs and offered people new jobs in the Music Tribe. So one can speculate: does Behringer plan a DJ gear offensive like in the Synthesizer and drum machine segment.
More information here: Native Instruments