Thanks to Swordmaker for the ping!!
Posted on 05/25/2016 1:02:24 PM PDT by Swordmaker
The company is taking a $950 million charge to unwind the last vestiges of the Nokia deal.
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Microsoft is further scaling back its flagging phone business, exiting the consumer market and cutting another 1,850 jobs.
As part of the move announced Wednesday, Microsoft will take a $950 million charge and cut what little remained of its Finland-based phone hardware business, unwinding the last of its disastrous $7.2 billion acquisition of Nokia's phone unit.
Last week, Microsoft announced separately that it was selling what was left of its low-end "feature phone" business.
The company has been scaling back its phone ambitions ever since the Nokia deal closed, with CEO Satya Nadella quickly shifting to a strategy focused on bringing Microsoft's software and services to Android and iOS rather than trying to convince phone buyers to shift to Windows.
Despite all the cuts — and having already seen its market share dip below 1 percent — Microsoft says it isn't totally out of the phone-making business.
The company insists it will continue to serve phones aimed at the business market and license Windows 10 to any other hardware makers that want to give Windows Phone a try.
"When I look back on our journey in mobility, we’ve done hard work and had great ideas, but have not always had the alignment needed across the company to make an impact," Microsoft's Windows and Devices head Terry Myerson wrote in an email to staff.
While the company said Wednesday to expect new Microsoft-made phone models, it declined to offer any specifics on its future hardware roadmap or to say why an even more decimated phone lineup will have greater appeal than the current one.
Microsoft moved last summer to limit the number of countries in which it sold phones and to focus on three main customer segments: Windows enthusiasts, entry-level smartphones and the business market.
Already by then it was hard to see how Microsoft could win by scaling back.
"It’s hard to see Microsoft’s massive phone layoffs leading to something other than an eventual exit from the phone business," Recode wrote at the time.
Here's Myerson's full memo to Microsoft employees:
To: Microsoft - All Employees
From: Terry Myerson
Date: Wednesday 5/25, 2AM Pacific Time
Subject: Focusing our phone hardware efforts
Team,
Last week we announced the sale of our feature phone business. Today I want to share that we are taking the additional step of streamlining our smartphone hardware business, and we anticipate this will impact up to 1,850 jobs worldwide, up to 1,350 of which are in Finland. These changes are incredibly difficult because of the impact on good people who have contributed greatly to Microsoft. Speaking on behalf of Satya and the entire Senior Leadership Team, we are committed to help each individual impacted with our support, resources, and respect.
For context, Windows 10 recently crossed 300 million monthly active devices, our Surface and Xbox customer satisfaction is at record levels, and HoloLens enthusiasts are developing incredible new experiences. Yet our phone success has been limited to companies valuing our commitment to security, manageability, and Continuum, and with consumers who value the same. Thus, we need to be more focused in our phone hardware efforts.
With this focus, our Windows strategy remains unchanged:
1. Universal apps. We have built an amazing platform, with a rich innovation roadmap ahead. Expanding the devices we reach and the capabilities for developers is our top priority.
2. We always take care of our customers, Windows phones are no exception. We will continue to update and support our current Lumia and OEM partner phones, and develop great new devices.
3. We remain steadfast in our pursuit of innovation across our Windows devices and our services to create new and delightful experiences.Our best work for customers comes from our device, platform, and service combination.
At the same time, our company will be pragmatic and embrace other mobile platforms with our productivity services, device management services, and development tools -- regardless of a person’s phone choice, we want everyone to be able to experience what Microsoft has to offer them.
With that all said… I used the words “be more focused” above. This in fact describes what we are doing (we’re scaling back, but we’re not out!), but at the same time I don’t love it because it lacks the emotional impact of this decision. When I look back on our journey in mobility, we’ve done hard work and had great ideas, but have not always had the alignment needed across the company to make an impact. At the same time, Ars Technica recently published a long story documenting our journey to create the universal platform for our developers. The story shows the real challenges we faced, and the grit required to get it done. The story closes with this:
And as long as it has taken the company, Microsoft has still arguably achieved something that its competitors have not... It took more than two decades to get there, but Microsoft still somehow got there first.
For me, that’s what focus can deliver for us, and now we get to build on that foundation to build amazing products.
Microsoft can do a good job when it does the stuff it knows how to do.
If memory serves, CNBC puts the number at 7800, including all the former Nokia employees from that acquisition.
Happily, all of the applications and printer still worked after this hijack of this machine. And yes, Microsoft can sometimes write some pretty good code after several attempts. But that is not my point - arrogant Microsoft has mistreated their customers for many years. I have used their OS since DOS 2.10. I evolved over time from being a big fan to a severe critic because of the way they treat their customers. In my determination to escape Microsoft and its abuses, I found some software that I actually prefer using more: Linux.
I think that may be the total to date. . . Do you remember the acquisition cost?
It’s worse than rape. We only use our desktops to access the internet and to store software which we then enter data in and transmit. We set all our computers to no downloads without asking and then when each person goes home for the day they unhook their computer from the internet. Not much else I know to do. Hopefully that will help some.
The computers with all our data are laptops and they aren’t even connected to the internet. Takes a little more time for everyone to do their work but at least we know client’s and patient’s information cannot be accessed that way.
Dunno, but I’d guess it not be cheap.
Thanks to Swordmaker for the ping!!
From ATT?
Thanks for the ping.
I am not surprised they are continuing to focus on corporate customers. Ultimately, that is their biggest market. Exchange is one of the most important things Microsoft sells from a Microsoft point of view, because it facilitates a lot of their vendor lock-in strategy.
Microsoft blew 3 billion buying Nokia. I knew this was stupid move when it took place.
But what do they care. MS has 100 billion in cash offshore and tens of billions held in the USA
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2014
In its latest regulatory filing, the software giant said it has now stockpiled $92.9 billion offshore and that this money could have cost the company $29.6 billion in taxes, but didn’t.
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Moody´s: Microsoft, Apple and Google´s Combined Cash Reserves Close to $400 Billion
winbuzzer.com · 1 day ago
Microsoft, alongside Apple and Google, holds 23% of all corporate cash in the United States, with other companies
I’ve had lumias for 3 years now — I really like my current phone and the previous phone
It’s an unlocked phone direct from Microsoft. You could use it on AT&T or T-mobile in the USA or probably any of the smaller carriers who use GSM.
I’ve heard rumors that Microsoft was going to release a version compatible with Verizon bands but I’m not sure if that will happen.
Personally, I think they should have released it supporting every band, much like Apple does with their iPhone and let people decide. Of course it’s still up to the network provider to permit the phone to connect.
“We set all our computers to no downloads without asking and then when each person goes home for the day they unhook their computer from the internet. Not much else I know to do. Hopefully that will help some.”
Here is a suggestion for you. A legendary programmer named Steve Gibson has written a utility to prevent unwanted upgrades to Windows 10. It will also erase any Windows 10 install files that have been secretly downloaded to your computer before the unwanted upgrade happens. Gibson used to write commercial utility programs such as the disk utility named SpinRite. Most of the software he writes now is free to the world, as this is.
https://www.grc.com/never10.htm
What? Did you pull that figure out of thin air? It was $7.2 and change for Microsoft to acquire the mobile division of Nokia, not $3 billion.
Thanks for the correction. You are correct!
7.2 billions flushed down the toilet by Steve Balmer I suppose
Phone deal with Nokia became Microsoft’s $10 billion mistake
May 25, 2016
When Microsoft bought Nokia’s phone unit, then-Chief Executive Steve Ballmer touted the deal as a move that “strengthens us as a company in so many ways.”
Instead, the acquisition seems destined to be remembered as one of the company’s largest strategic missteps, a costly failure to boost Microsoft’s weak standing in mobile computing.
Since the $7.9 billion purchase of Nokia handset business was sealed in April 2014, Microsoft has laid off thousands of employees at manufacturing plants and research facilities from Redmond to Finland to China.
All in all Microsoft squandered 10 billion dollars on Nokia!!!!
Like I said I knew it was pos deal when it was done in 2013. Why? Because the Asians were becoming ascendant in the smart phone business and were eating Nokia alive. Nokia’s day was during the age of cell phones. This was when they reigned supreme.
Nokia honchos were overjoyed when the ridiculous Steve Ballmer showed up to buy up their business.
Nope, can't lay this rotten egg at Steve Balmer's feet. He resigned as CEO of Microsoft effective December 2013 and resigned from the Board of Directors in August 2014.
Microsoft announced the start of the Nokia acquisition in September of 2014. . . after Balmer was gone. Looks like he didn't want to have anything to do with it.
$10 billion is probably about right, now that I think about it.
Oops. The article I was referencing claimed September 2014. . . but it was actually September 2013 when Microsoft made their Nokia acquisition announcement. So it WAS a Balmer fiasco! Sorry about that Dennis. Another commentary on the state of Journalism today.
My apologies for correcting you when it was YOU who was correct.
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