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Microsoft moves to exit consumer smartphone business
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May 25, 2016, 12:27 PM
 
Following the recent sale of the Nokia name and feature phone business to manufacturing partner Foxconn, Microsoft CEO Satya Nadella has announced the layoffs of 1,850 employees -- mostly former Nokia workers in Finland -- and the "streamlining" of the company's smartphone business, which will involve "focusing our efforts where we have differentiation -- with enterprises that value security, manageability, and our Continuum capability," according to a release.

While the Redmond giant says it will continue to support existing Windows Phone consumer buyers, it will be taking a nearly billion-dollar write-off on its smartphone division, and is for all intents and purposes throwing in the towel on consumer smartphones. Of the $950 million charge, about $200 million is reserved for severance packages. In a memo, Windows and Devices chief Terry Myerson noted that the company was "scaling back, but we're not out," despite no new announced products, and will concentrate on its enterprise business -- even though it has a minuscule share even in that segment.



The latest stage of the death of what was once -- pre-, and for a while, post-iPhone -- the largest and most successful smartphone brand in the world began some 10 months ago, when Microsoft wrote off its entire investment in Nokia. It has now sold off the name and feature phone side of the business to Foxconn for $350 million, which will make its own Nokia-branded, Android-powered smartphones and feature phones. While it is true that Microsoft has done better with enterprise than other sectors with its smartphones, the chances that it can overcome the entrenchment of Apple's partnerships with IBM and SAP seem remote.

"These changes are incredibly difficult because of the impact on good people who have contributed greatly to Microsoft," Myerson wrote in the memo. "Speaking on behalf of Satya and the entire senior leadership team, we are committed to help each individual impacted [by the layoffs] with our support, resources, and respect ... 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." Nadella echoed that last sentiment, saying that the company "will continue to innovate across devices and on our cloud services across all mobile platforms."
     
Spheric Harlot
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May 25, 2016, 01:12 PM
 
"It's dead, Jim."
     
ruurd
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May 25, 2016, 03:44 PM
 
So they are becoming what? Blackberry the Second eh. Betcha they will bring out a phone with a hardware keyboard.
     
Sosa
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May 25, 2016, 04:49 PM
 
The once powerful juggernaut is retreating...
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coffeetime
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May 25, 2016, 05:27 PM
 
I knew that's coming. Are they going to have a funeral for Windows Phone?
     
Spheric Harlot
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May 25, 2016, 05:30 PM
 
Originally Posted by coffeetime View Post
I knew that's coming. Are they going to have a funeral for Windows Phone?
I hate to gloat, because I really, really wanted Windows Phone around as a competitor to Apple apart from Android, but I've been looking for that pathetic iPhone funeral procession video held when Windows Phone was first released. Just like Ballmer's laughing-off, that kind of hubris can boomerang in a really bad way.
     
Charles Martin
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May 25, 2016, 11:59 PM
 
Spheric: totally on the same page with you on this. Windows Phone and the Lumia are pretty great phones, really, if you're looking for an alternative to iOS for some reason and don't want a Java-based iOS rip-off, ie Android. So it was good to have an alternative. Pity they couldn't make that work.
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davisadm
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May 26, 2016, 10:39 AM
 
Years ago, NOKIA was the mobile phone that everyone looked up to. To bad Nokia drove themselves into the ground. And Microsoft did not really do anything to resurrect them. RIP Nokia!
     
   
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