Correcting Steve Ballmer’s error of buying the mobile world’s former number one has not come in cheap for Microsoft. Last week Microsoft sold off what remained of Nokia’s feature phone business while the Windows Phone market slid below a single percent. Microsoft has recorded a $950 million impairment and restructuring charge on its balance sheet.
$200 million of this charge is due the severance package payouts being handed out as a result of cutting 1850 jobs, 1350 of which were located in Finland. These jobs cuts are enabling Microsoft to sever all ties with the fading remains of Nokia. Microsoft went to great lengths to assure that the job cuts were focused entirely on Microsoft Mobile OS and that the company’s finish sale department was protected.
According to CEO Satya Nadella the company is redirecting its phone efforts to where it has “differentiation — with enterprises that value security, manageability and our Continuum capability.” After the sale of its feature phone business, Microsoft put forward an oddly worded statement which only showed support for Windows Phone devices.
If one was to ponder over the statement it could be deduced that Microsoft would no longer build the handsets itself but give third parties such as VAIO, HP and Acer a chance to take over. On the other hand it is also rumored that Microsoft will only be building handsets from its more successful surface division, ending the Lumia brand. According to a copy of the internal memo published by Recode, Terry Myerson refuses to abandon mobile altogether only justifies scaling back.
He also mentions that Microsoft will continue to develop “great new devices” but fails to mention if Microsoft will be personally doing so. The bigger objective of the company is “embrace other mobile platforms with our productivity services,” or making its apps and services available with android and iOS devices.