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July 18, 2014

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Listed below are links to weblogs that reference Microsoft fires 12,500 ex-Nokia mobile people, ends X Series running Android, and Elop authors another moronic memo:

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Leslie

Elop can pursuit the job of General Manager of the Los Angeles Clippers.

Jouko Ahvenainen

This is my analysis from February, and it is really now happening: http://www.telecomasia.net/blog/content/wheres-microsoft-mobile-heading. I predicted 50% layoffs and Office and other products must go to iOS and Android too.

It is important to remember mobile strategy as a whole for Microsoft is much more than own hardware and devices, and to be honest, I don't know if mobile devices will stay in it.

Jouko Ahvenainen

And here is my updated analysis: http://www.telecomasia.net/blog/content/ms-swings-mobile-strategy-action-layoffs.

@claes

"if you wanted to change careers, gosh, almost every other industry is also looking to get into mobile"

So true.

Aviezer

I begin to suspect that Elop has some information about Balmer and/or Microsoft that is so bad that neither Balmer nor Microsoft want this information to be disclosed to the public. This is the reason they keep him on the payroll.

abdul muis

@Aviezer

I was thinking that Microsoft know some Jorma Olila secret, like a mistress affair that make Elop got the Job at Nokia in the first place.

klaus knolle

Good old times 14. Feb 2011

"Any Nokia software engineers need a job? We're hiring: www.google.com/jobs," read the tweet posted by Google EMEA (Europe, the Middle East and Africa) recruiter Aidan Biggins.

cornelius

I read somewhere else that the department most affected by the layoffs will be the testing department. I am just curious to see how this will affect the number of bugs and the overall quality of the Nokia phones. I think this end of Nokia X is a blessing in disguise, because a buggy Nokia X phone would have tarnished Android's reputation.

Joe

Sounds like Asha and S40 are also being killed (aka put in "maintenance only" mode) according to a Memo by Harlow: http://www.bgr.in/manufacturers/nokia/microsoft-to-abandon-mobile-phones-x-series-android-smartphones-internal-jo-harlow-memo/

Every time it is sad to watch this massive downfall of an empire in such a short time...

youAPPi

It's unfortunate. But, as you predicted, not exactly shocking. I'm glad you left it on a positive note, though. Best of luck to all ex-Nokians finding greener pastures.

AndThisWillBeToo

I still say Nokia X was done with Microsoft support. It just was Ballmer support, not Nadella. The mere fact that Nokia X2 was launched under Microsoft and that they put them "in maintenance mode" instead of killing them out right (Kin anyone?) tells that it was an experiment tried and abandoned.

Eurofan

In the comment section of a Guardian article, someone posted Elop's entire memo. I'm copying it to this forum.

Hello there,

Microsoft’s strategy is focused on productivity and our desire to help people “do more.” As the Microsoft Devices Group, our role is to light up this strategy for people. We are the team creating the hardware that showcases the finest of Microsoft’s digital work and digital life experiences, and we will be the confluence of the best of Microsoft’s applications, operating systems and cloud services.

To align with Microsoft’s strategy, we plan to focus our efforts. Given the wide range of device experiences, we must concentrate on the areas where we can add the most value. The roots of this company and our future are in productivity and helping people get things done. Our fundamental focus – for phones, Surface, for meetings with devices like PPI, Xbox hardware and new areas of innovation -- is to build on that strength. While our direction in the majority of our teams is largely unchanging, we have had an opportunity to plan carefully about the alignment of phones within Microsoft as the transferring Nokia team continues with its integration process.

It is particularly important to recognize that the role of phones within Microsoft is different than it was within Nokia. Whereas the hardware business of phones within Nokia was an end unto itself, within Microsoft all our devices are intended to embody the finest of Microsoft’s digital work and digital life experiences, while accruing value to Microsoft’s overall strategy. Our device strategy must reflect Microsoft’s strategy and must be accomplished within an appropriate financial envelope. Therefore, we plan to make some changes.

We will be particularly focused on making the market for Windows Phone. In the near term, we plan to drive Windows Phone volume by targeting the more affordable smartphone segments, which are the fastest growing segments of the market, with Lumia. In addition to the portfolio already planned, we plan to deliver additional lower-cost Lumia devices by shifting select future Nokia X designs and products to Windows Phone devices. We expect to make this shift immediately while continuing to sell and support existing Nokia X products.

To win in the higher price segments, we will focus on delivering great breakthrough products in alignment with major milestones ahead from both the Windows team and the Applications and Services Group. We will ensure that the very best experiences and scenarios from across the company will be showcased on our products. We plan to take advantage of innovation from the Windows team, like Universal Windows Apps, to continue to enrich the Windows application ecosystem. And in the very lowest price ranges, we plan to run our first phones business for maximum efficiency with a smaller team.

We expect these changes to have an impact to our team structure. With our focus, we plan to consolidate the former Smart Devices and Mobile Phones business units into one phone business unit that is responsible for all of our phone efforts. Under the plan, the phone business unit will be led by Jo Harlow with key members from both the Smart Devices and Mobile Phones teams in the management team. This team will be responsible for the success of our Lumia products, the transition of select future Nokia X products to Lumia and for the ongoing operation of the first phone business.

As part of the effort, we plan to select the appropriate business model approach for our sales markets while continuing to offer our products in all markets with a strong focus on maintaining business continuity. We will determine each market approach based on local market dynamics, our ability to profitably deliver local variants, current Lumia momentum and the strategic importance of the market to Microsoft. This will all be balanced with our overall capability to invest.


Our phone engineering efforts are expected to be concentrated in Salo, Finland (for future, high-end Lumia products) and Tampere, Finland (for more affordable devices). We plan to develop the supporting technologies in both locations. We plan to ramp down engineering work in Oulu. While we plan to reduce the engineering in Beijing and San Diego, both sites will continue to have supporting roles, including affordable devices in Beijing and supporting specific US requirements in San Diego. Espoo and Lund are planned to continue to be focused on application software development.

We plan to right-size our manufacturing operations to align to the new strategy and take advantage of integration opportunities. We expect to focus phone production mainly in Hanoi, with some production to continue in Beijing and Dongguan. We plan to shift other Microsoft manufacturing and repair operations to Manaus and Reynosa respectively, and start a phased exit from Komaron, Hungary.

In short, we will focus on driving Lumia volume in the areas where we are already successful today in order to make the market for Windows Phone. With more speed, we will build on our success in the affordable smartphone space with new products offering more differentiation. We’ll focus on acquiring new customers in the markets where Microsoft’s services and products are most concentrated. And, we’ll continue building momentum around applications.

We plan that this would result in an estimated reduction of 12,500 factory direct and professional employees over the next year. These decisions are difficult for the team, and we plan to support departing team members’ with severance benefits.

More broadly across the Devices team, we will continue our efforts to bring iconic tablets to market in ways that complement our OEM partners, power the next generation of meetings & collaboration devices and thoughtfully expand Windows with new interaction models. With a set of changes already implemented earlier this year in these teams, this means there will be limited change for the Surface, Xbox hardware, PPI/meetings or next generation teams.

We recognize these planned changes are broad and have very difficult implications for many of our team members. We will work to provide as much clarity and information as possible. Today and over the coming weeks leaders across the organization will hold town halls, host information sharing sessions and provide more details on the intranet.

The team transferring from Nokia and the teams that have been part of Microsoft have each experienced a number of remarkable changes these last few years. We operate in a competitive industry that moves rapidly, and change is necessary. As difficult as some of our changes are today, this direction deliberately aligns our work with the cross company efforts that Satya has described in his recent emails. Collectively, the clarity, focus and alignment across the company, and the opportunity to deliver the results of that work into the hands of people, will allow us to increase our success in the future.

Regards,


Stephen

Henry

Hi Tomi,
I'm a former Nokia engineer, worked actively in the design of last Symbian products (N8 engine and the never born dual-core), and I was caught in the first wave of lay-offs decided in 2010 by Mr Elop (and who was behind him). I think you have written very noble words to all former and actual Nokia employees. Unfortunately the reality for thousands and thousands of people has not been so rosy. I know personally many former colleagues that have struggled to find another job, have changed but had to change again, or had to relocate with or without family in any angle of the world, accept lower salaries and harsher conditions to carry on, others are even still unemployed..it's true, as you say, that many Nokia engineers were skilled and in demand, but it's also true that many of us had to fight hard to find a job looking in different sectors, competing in a job market very demanding and (I could say) also cynical. This has created and will continue to create a situation of professional and personal instability and stress in the life of thousands of individuals and families. What is constantly upsetting me is that all this seems at the end to have been caused by a lack of ethics and professionalism and by the feeble reaction of governments and institutions against it. Design and purposes were clear from the beginning..I hope only that the disaster happened to Nokia will serve in the future to avoid another Nokias.

Tomi T Ahonen

Hi all

Jouko Ahvenainen's first article from early February in TelecomAsia was exceptionally sharp - even for Jouko's always-sharp analysis and insights (he's one of my oldest friends in telecoms, we used to work at neighboring desks early in my Nokia career haha). I just tweeted the link to it to my followers. Brilliant call Jouko on the 50% layoffs and like you said, the range is bigger and we both know, this is not the last round of layoffs at the Microsoft-Nokia unit...

The new article is also insightful, thanks Jouko for the link, I hadn't noticed it yet. It is an excellent read and I urge all of my readers here to go read that too. As you'll notice Jouko says the three ways forward for Microsoft's handset business is either grow it's market share, or shut it down, or sell it. I agree totally. And I would add, we know from the Nokia Lumia and Windows Phone history that growing market share will never happen. So while that is of course the goal of Nadella at Microsoft - he'll replace Elop before they admit this was a lost cause so another VP will get a chance to try that futile mission in the future - the real end result is either the unit will be shut down or sold. I hope sold as the talent left in those demoralized 12,500 ex-Nokians left at Microsoft, is so deep and useful, they deserve to get a job somewhere else, where their efforts are appreciated.

Thanks Jouko. I always love reading what you write (or hearing what you say when you speak)

(PS Jouko wrote the foreword to the second printing of my third book, 3G Marketing. He now runs his VC company and is involved in all sorts of cool bleeding edge tech stuff)

Tomi Ahonen :-)

krishna

There has to be something, why Mr. Elop who reduced the Nokia from 60,000 employees to about 12000 now is allowed to continue. He knows more than what meets the eye.

AtTheBottomOfTheHilton

I have an idea that will be a nail in the eye for Microsoft. I think that the EU should do a GM (General Motors). Basically a state funded project that will resurrect Symbian (which is possible from the open sourced version).

EU legislators owe ex-Nokia engineers this as they allowed the Nokia buy-up to happen.

MH

I guess now it seems pretty clear (to me, at least!) that the main function of Nokia X was to scare Microsoft into buying the handset business - showed that Microsoft needed Nokia much more that Nokia needed Microsoft.

cornelius

@MH
If your theory is true then why did they wait two months to kill Nokia X? They should've killed it on the spot, unless
1. Microsoft supported Nokia X for a while
or
2. Microsoft's decision chain is so slow that a proposal needs two months in order to be approved.

I, personally, think Microsoft is just confused which is the normal state of affairs at Microsoft.

Èarendil Star

Let's be clear: since 2010 nothing has moved at Nokia that MS did not want.
So, it does not make sense to say that the Nokia X was made to "scare MS into buying Nokia".
Nokia X was there as an attempt to entice emerging market buyers into the MS ecosystem. An attempt jointly decided by Ballmer and Elop.
What is happening now, is that Nadella is starting to tackle mobile, and it is possible that Nokia X's results were much better than expected, but with no benefit for the MS ecosystem. Therfore the decision to end the trial.

What now becomes interesting is what becomes of Flop... in this new Nadella era...

foo

According to the leaked memo:

"all our devices are intended to embody the finest of Microsoft’s digital work and digital life experiences, while accruing value to Microsoft’s overall strategy. Our device strategy must reflect Microsoft’s strategy and must be accomplished within an appropriate financial envelope. Therefore, we plan to make some changes."

Well, that seems to describe perfectly what Elop did to Nokia years before the acquisition: subjecting Nokia to Microsoft's strategy.

The short-lived Android adventure was the way Elop found to force Microsoft to acquire Nokia. Basically, he adopted the "plan B" that he refused to adopt before.

WonTheLottery

It's been revealed Samsung have another two Tizen devices in the offing, the SM-Z130E and the SM-Z130H. The model numbers suggest low end devices (the Z denotes Tizen, the 1 denotes low end) as opposed to the delayed SM-Z910F (Samsung Z) which was much higher up the scale.

Samsung have stated Tizen runs fine on as little as 256 mb of RAM and these two new devices are rumoured to be targeting the £40-£50 price point.

An interesting development considering India is the largest market that has yet to be converted to smartphones and Microsoft has just driven another nail into the coffin of India's favourite brand.

Spawn

http://www.businessinsider.com/satya-nadella-is-cleaning-up-steve-ballmers-mess-2014-7

"It's a waste of time and effort to invest so much in Windows Phones from Nokia that have failed to gain significant market share in a world dominated by the iPhone and Android."

This sentence is pure gold. Windows Phone *is* Nokia's (burning) platform since nobody else uses / stands on it. Elops 'war of ecosystem' was lost, as was confirmed by Bill Gates a year ago, and its shut down by Nadella now. Unfortunately that includes whats left of Nokia since everything else what Nokia had was shutdown by Elop during his war-of-ecosystem years as Nokia CEO.

And who keeps his job? The 30 million dollar man, S. Elop.
What a horrible world.

Spawn

@WonTheLottery

"Samsung have stated Tizen runs fine on as little as 256 mb of RAM"

So does Android. The limited memory only turns into a problem once you start applications. Granted not at Tizen because there are no apps at Tizen :-)

"these two new devices are rumoured to be targeting the £40-£50 price point"

$50 smartphone-devices are there already since a while now. They all run Android kitkat, apps work fine.

epdm

Can someone please answer me this:

Micro$oft produced the richest men on the planet. People who's hobby is being a philanthropist and donating money to good causes (see link below).

http://www.gatesfoundation.org/How-We-Work/Quick-Links/Grants-Database

Yet they can't or won't support the welfare and jobs of their employees?

Why does nobody questioned this?

cornelius

@ WonTheLottery and Spawn
It seems that FirefoxOS is attacking Microsoft's low cost flank with $25 handsets. http://www.theregister.co.uk/2014/07/17/firefox_os_global_expansion/
So WP is completely surrounded by Linux based OSes.

@ epdm
It does make sense for Gates to donate to charities because he gets tax breaks for that. Keeping the employees doesn't help with the IRS.
Also, Microsoft donates a lot of licenses to Universities if they agree to replace non-Microsoft software and teach using Microsoft technologies (and Microsoft gets a tax break as well). For example for a web programming course scrap php and teach asp. Or scrap PostgreSQL and teach SQL Server, or C# instead of Java and so on. Later when the graduates will be tasked to build a solution they will recommend buying software from Microsoft.

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    Tomi Ahonen is a bestselling author whose twelve books on mobile have already been referenced in over 100 books by his peers. Rated the most influential expert in mobile by Forbes in December 2011, Tomi speaks regularly at conferences doing about 20 public speakerships annually. With over 250 public speaking engagements, Tomi been seen by a cumulative audience of over 100,000 people on all six inhabited continents. The former Nokia executive has run a consulting practise on digital convergence, interactive media, engagement marketing, high tech and next generation mobile. Tomi is currently based out of Hong Kong but supports Fortune 500 sized companies across the globe. His reference client list includes Axiata, Bank of America, BBC, BNP Paribas, China Mobile, Emap, Ericsson, Google, Hewlett-Packard, HSBC, IBM, Intel, LG, MTS, Nokia, NTT DoCoMo, Ogilvy, Orange, RIM, Sanomamedia, Telenor, TeliaSonera, Three, Tigo, Vodafone, etc. To see his full bio and his books, visit www.tomiahonen.com Tomi Ahonen lectures at Oxford University's short courses on next generation mobile and digital convergence. Follow him on Twitter as @tomiahonen. Tomi also has a Facebook and Linked In page under his own name. He is available for consulting, speaking engagements and as expert witness, please write to tomi (at) tomiahonen (dot) com

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