How the Grinch downsized Christmas

I pay as little attention as possible to the Rumor Mill's finances. As a result, I find myself at the mercy of my subordinates, who actually run the joint. This leaves me in a general state of blissful ignorance, but every so often I fall prey to acute bouts of paranoia. Friday, for instance, my secretary, Trixie Pixel, came to work wearing nothing but a pink slip. Was she trying to tell me something?

"Relax, Mista DuBawd," Trixie said in her lilting Long Island twang. "I got this last night at one of those Pink Slip parties."

While I try to decipher Trixie's fashion code, high-tech employees everywhere are struggling to discern their futures from a grim, new metric: an epidemic of holiday party cancellations.

Pink Slip parties may be flourishing, but those lavish shindigs that seemed like a good idea only a few months ago are being eighty-sixed right and left--or, in one well-chosen past participle on everyone's lips: downsized.

Companies with coal and sticks in their holiday party stockings include Excite@Home, E*Trade, Scient and MarchFirst.

In San Francisco, MarchFirst decided to bail out of its planned celebration at San Francisco's City Hall, costing the financially strapped company its nonrefundable deposit.

Rumors pegged that deposit at an astronomical fee, but sources at City Hall--where my boss, CNET Networks, threw its own party Tuesday--assure us it was just shy of $10,000.

"What we did was really downsize it," a MarchFirst flack said of the company's holiday celebration. "It's been a tough year for us regarding our recent layoffs--10 percent of the company--and we're facing a very challenging market. Right now we are in a cost-cutting period, and (it) would be somewhat irresponsible for us to spend a lot of money on a party."

Rumor has it that Scient also lost its Christmas party deposit. Skinformants say the company bailed on its holiday plans after deciding it would be bad form to be caught partying so shortly after laying off 460 employees.

Excite@Home isn't stopping the belt-tightening at holiday economies. Struggling with cash burn and its dwindling stock price, the company has canceled the Christmas party and is also cutting corners at every turn. Skinformants say this has included letting go most of the front lobby receptionists and even asking employees not to print cover sheets with their printouts.

Excite@Home is accentuating the positive, noting that it has scheduled "alternative stuff" for the holiday celebrations. These include smaller, local parties and volunteer activities with local schools and charities.

"Because of the market conditions, people got together and said, 'I'm a shareholder, I want to do something better with my time,'" said one Excite@Home flack. "So we've changed the focus from having the huge holiday party."

Now that everyone's poor, charity seems to be the holiday activity of choice.

"In keeping with the holiday spirit, we are making a charitable donation to Children's Memorial Hospital here in Chicago," said our MarchFirst flack. "And we did not receive one piece of negative feedback regarding this decision from our 8,000 employees."

AltaVista, fresh from layoffs, is singing a similar tune.

"In lieu of a holiday party, we are participating companywide in charity programs for needy families. This option was decided by popular employee vote and verified after a hand-recount of all ballots," quipped a company flack.

Some holiday themes lent themselves to more casual affairs. At Red Hat's "Hawaiian-themed party," beach attire was more popular with Red Hat's nerdy employees than last year's formal event. "We have so many developers here that they don't like to dress for a holiday party," said our source. "Our event coordinator got a lot of complaints. This year it was beachwear. People were happy with that."

Plus, staffers got to witness senior management get onstage hula lessons.

"Seeing (chairman) Bob Young swivel his hips is a sight," our source said.

In addition to those "canceled due to bankruptcy," (in the words of one Valley exec), some holiday plans never got far enough to get canceled. Said a friend at troubled NorthPoint: "We never planned one to begin with."

But not everyone is shy about fiddling as Santa Clara County burns. Web start-up Epinions will cavort at Sony's Metreon in San Francisco next week.

"You gotta have a special event for your employees," said Epinions chief executive Nirav Tolia. "Even though I think every single Internet company is trying to cut costs, this is important."

Do dot-com employees agree? One tipster reported that a local start-up's plans to go ahead with the holiday party are causing some grumbling among the ranks. One rank-and-file Grinch was heard complaining that she'd rather get her overdue paychecks than a fancy party.

Meanwhile, Vault.com is circulating the findings of its survey of corporate holiday party plans, showing that only 9 percent will spend less than they did last year. Could all those 9 percent be doing business on the Web?

Obscene wealth
If you've got it, flaunt it. Caspian Networks, a networking hardware start-up, is earning jeers for its Web site. The text reads: "$140 million. Some networking companies are having problems raising money these days. Not us. We just landed a huge third round of financing." Below that, a pile of bundled greenbacks descend infinitely into a cloudy white background.

"That is just gross," said one VC, and who can argue with him?

Ad campaign up in smoke
Michel Mayer, general manager of the pervasive computing group at IBM, showed off an IBM ad that aired on national TV for only six hours to attendees at the Technology Outlook conference in Burlingame. In it, an obviously American couple sails down the canals of Venice. The woman, looking dreamily at the faded glory of the Doges, suddenly starts.

"I didn't turn off the gas."

Next image: a colonial-style American house explodes, but only in her imagination. The husband then pulls out his cell phone and sends a command to the connected stove to turn off the gas jets.

Although the ad got a big laugh, Mayer informed the crowd that power companies objected to it immediately, so IBM withdrew it.

On other notes, Mayer reported that IBM has managed to compress a Linux computer onto a wristwatch. Although it is a full-functioning computer, functionality is limited. "I would like to demonstrate it, but we have only one application, and that is to show the time." I see my time is up for this week, so the clock is already ticking on next week's column--featuring your rumors.