Microsoft cuts 1,850 jobs winding down phone business


So, Nokia NOT immortal

The Windows Phone operating system looks like it’s going the way of Zune as Microsoft announced 1,850 layoffs in its phone sector and an associated $950 million write-off ($200 million of which is reserved for severance pay). Of that number, 1,350 are in Finland, effectively wiping out cell stalwart Nokia after Microsoft bought the company just three years ago for $7.2 billion.

Nokia’s Lumia always seemed like a pretty alright phone, but the smart phone game’s rough when you’re not Samsung or Apple. Just look how HTC has been scrambling.

We will continue to develop new devices and adapt Windows 10 for small screens, support Lumia Phones such as the Lumia 650, Lumia 950 and Lumia 950XL, and phones from our OEM hardware partners like Acer, Alcatel, HP, Trinity and Vaio, where we’re seeing good traction,” read a Microsoft statement.

In a staff-wide memo obtained by Recode, Microsoft’s Terry Myerson explained, “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.”

The idea of “more focus” here reads a lot more like “tapping out,” which is understandable; Windows Phone commands less than 1% of smart phone operating system market share. Microsoft is leaving the OS open to be licensed by other hardware manufacturers that feel like making a Windows phone (who? why?). It seems like Microsoft itself will still be making Windows phones (or, “develop great new devices”), perhaps pared down and aimed at the business market (a new-age Blackberry); the company didn’t comment specifically on if this means the end for the Lumia line.

Microsoft is giving up on consumer smartphones, too [Recode]