I’m not one to laugh at other people’s failure… except that I am, and one of my favorite targets to laugh at is Microsoft and it’s hilarious attempts to become a serious player in the mobile market. It’s efforts in this regard are riddled with amusing failures, but the biggest and most amusing failure of them all is its decision to acquire Nokia’s handset division. Microsoft has nothing of substance to show for the acquisition after two years, and it’s looking more and more like it was a waste of $8 billion. It’s almost impressive how efficiently Microsoft is able to throw away all this cash.
Microsoft is taking another almost $1 billion hit on its failed Nokia acquisition today. The software maker is “streamlining” its smartphone business, writing off $950 million and cutting 1,850 jobs. The cuts come almost a year after Microsoft wrote off $7.6 billion and cut 7,800 jobs. Only a small number of former Nokia employees will remain at Microsoft, and the company’s consumer phone making days are over. Microsoft has wasted at least $8 billion on its failed Nokia experiment, including the costs of restructuring and severance payments for thousands of employees. Microsoft originally hired 25,000 Nokia employees as part of its $7.2 billion acquisition of Nokia’s phone business, but a series of layoffs over the past two years has triggered the end of Microsoft’s mobile subsidiary. Microsoft’s Nokia phone business acquisition was always tricky and risky, but it was a deal organized by former CEO Steve Ballmer. It has been clear from the start that Satya Nadella, Microsoft’s new CEO, wasn’t interested in running a phone business. Nadella announced a strategy shift away from a “devices and services” focus just a couple of months after the Nokia acquisition finalized, and last year the strategy shifted even further away from producing multiple handsets.