Microsoft confirms fresh round of layoffs

Both the Nokia and aQuantive deals were engineered by ex- CEO Steve Ballmer, who sought to compete against younger, faster-growing tech companies by expanding beyond Microsoft’s original business of making software for desktop computers. He added that the company intends to shift from a strategy to create a standalone business towards creating and developing a live windows ecosystem incorporating their first-part device family. “We’ll bring business customers the best management, security and productivity experiences they need; value phone buyers the communications services they want; and Windows fans the flagship devices they’ll love”, he said, describing the categories which could also be detailed as business phones, budget phones, and high-end phones.

AOL previously used Google to power its search engine. But it was not before February 2010 that Microsoft announced Windows Phone. It would also cut 7,800 employees from its global payroll.

Microsoft said it would also write down about $7.6 billion related to its Nokia business.

The move marks one of the costliest strategic errors in Microsoft’s history.

The news comes a year after Microsoft first announced a massive round of layoffs that primarily hit employees it acquired from Nokia.

The move is a clear acknowledgment that the deal was a multibillion-dollar strategic blunder by Ballmer, who had envisioned it as a way to make Microsoft more competitive in the mobile market dominated by Apple, Google and Samsung. Last month, ex- Nokia CEO Stephen Elop left Microsoft in a surprise departure.

The announcement of the job cuts is an acknowledgment that the software maker’s $7.2B acquisition of Nokia in 2013 was never helpful in its Windows Phone sales; hence, a new approach was necessary.

At the end of March, Microsoft had more than 118,000 employees globally.

After this fresh round of job cuts, Nadella said that it is not required to focus on phone efforts in the near term while driving reinvention.

According to The Telegraph, the recent job cut from Microsoft’s hardware division means that the company is gearing towards a future focused mainly on selling software.

A Microsoft statement said it would “restructure the company’s phone hardware business to better focus and align resources”.