Broadcom axes ServerWorks chief

Rallies around Dickhut

Like an abusive parent slapping an over-active child, Broadcom has dismissed the head of its ServerWorks subsidiary and made a public spectacle of the event.

Duane Dickhut, former head of Broadcom's broadband processor business unit, will step in to lead ServerWorks and replace current chief Raju Vegesna. Such a move might have slipped under the radar were it not for Broadcom's astonishing press release detailing the executive dismissal.

Broadcom ever so tactfully remarked: "Raju brought ServerWorks from a start-up enterprise to a position of industry leadership," said Alan Ross, President and CEO at Broadcom. "Recently, there have been disagreements between the ServerWorks and Broadcom management teams over a number of operational issues and the strategic direction of ServerWorks and how the business fits into Broadcom's long-term plans. In view of concern over these issues, we felt that Broadcom's long-term interests would be best served by the actions we have taken today."

Broadcom rallies around Dickhut

One possible explanation for this move could be that Vegesna wanted too much control over ServerWorks and was not willing to listen to suggestions from the Broadcom overlord. A fierce boardroom battle is the only way to make sense of such spiteful language.

Then again, Vegesna has faced some embarassing moments of late, including a slip up when ServerWorks failed to produce enough of its Grand Champion chipset to satisfy demand.

Broadcom's CFO Bill Ruehle explained that "most people sugar coat their release," as defense of the language used today.

"The fact is that there have been some disagreements on a professional level on the direction of the business," he said. "We mutually felt those were getting in the way."

Ruehle said that Broadcom does indeed want to have tighter control over its product portfolio and be able to mesh technology together as it sees fit.

He hopes morale at ServerWorks will stay high, but with a send off like that, one can only imagine the trepidation with which other execs walk the ServerWorks halls. ®

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