Elop Fired From Job at Head of Microsoft Handsets (Old Nokia Lumia Unit) - New Windows & Devices Boss is Terry Myerson

So the Elop nonsense and destructive managment methods lasted only 15 months under Satya Nadella's watchful eye at Microsoft. He is effectively fired from Microsoft. The company realigns handsets into one division under Windows headed by Exec VP Terry Myerson. And Elop plus two other senior execs are kicked out with the press release out today.

Good riddance. Stephen Elop was the worst CEO in corporate history. He clearly was at fault on the top, when he went to Microsott, that same ex-Nokia handset unit with Lumia running on Windows Phone never did any better. Today we've seen new Microsoft CEO Satya Nadella examine Elop's performance of the flagship future division - you remember Nadella's introductory remarks to his employees were all about mobile and the cloud - now Elop is gone. And look at the text of the press release. Not one word about 'mobile' or 'handsets' or 'Lumia' in the actual announcements (only one mention on the bottom from the description of Microsoft the company being a 'mobiile-first' company). What a huge shift away from the failing Lumia unit to 'Windows and Devices' ie Surface will do fine, Xbox is doing fine. Lumia is dead.

Now someone will be running the Lumia unit under Exec VP Myerson for a while, and then when they see it is irretrievably dead, they will quietly shut down that business. This is a VERY clear sign of the writing on the wall. And sadly for any ex-Nokia employees, expect more layoffs to come in the aftermath of this announcement and the 'consolidation' within that new business unit. I think the ex-Nokia handset unit has no more than 24 months ahead of this point, and may be shut down far faster than that. Clearly Nadella knows how to read mathematics and the math about Elop's business was brutal. Elop is gone! A day of somber celebrtaions in Finland and all who were fired by that clown will think - at least he also got fired.

I will include a few links. If you just want to see one last time the performance of Stephen Elop and his 3 years as Nokia CEO, when we had clear metrics on the level of the destruction (Microsoft has not broken out the handset business performance this deeply except that the losses continued the past 15 months), you may want to read this one comprehensive summary of Elop tenure as Nokia CEO (with pictures).

I was not always against Elop. Before he joined Nokia, I was on this blog very criticial of his predecessor as CEO, Olli-Pekka Kallasvuo. I then welcomed Elop on this blog very eagerly in 2010 when he was announced. 

I was fully supportive of his first 5 months as CEO as Nokia's performance improved and Nokia reported record profits in its smartphone division by Q4 of 2010, when Nokia towered over its rivals (Nokia had grown more in the year of 2010 than Apple or Blackberry or Samsung, yes that is true! Nokia was 'winning' very clearly the global war of smartphones in literally every continent except North America where only a tiny fraction of the world's market was even back then). I explained where Nokia's problems were (in marketing, not strategy) and was on this blog a week before Elop's mad Windows gamble was announced, explaining why Nokia's then-current strategy on Symbian, MeeGo, Ovi and Qt was the right way for Nokia and its vast developer community, the carrier community and Nokia's handset-making partners both existing on Symbian and announced on MeeGo. If you want to read kind of 'what could have been' here I am warning BEFORE the Windows strategy is announced, that it would be the dumbest move Nokia could make (and that even Android would be better).

Then there was the big Windows Announcement. I wrote in shock yet if you read the second half part of the blog, all of my forecasts turned out true. This is only minutes after the announcement and yes I said it will end in Nokia smartphone business being sold, most likely to Microsoft itself.

It could have worked out. I then waited to see how the new Lumia handsets would be (as well as the promised better Windows Phone 7 OS platform). And once we saw what it looked like and how badly Elop was messing up everything in the most important launch in Nokia's history, while others were promising that Lumia would win, before the first actual numbers were out, I gave my prognosis of why Lumia will fail. All of this turned out true.

Then we had a couple of years of a comedy of errors by Elop. I reported reguarly on his nonsense. But then I wrote the definitive blog about Elop mismanagement, some of you will remember Sun Tzu applied to Elop management. 30,000 words of only his biggest strategy blunders in 2 years. This is the definitive treatise of what all he destroyed at Nokia. Its perhaps the masterpiece blog article on this blog.

And lastly, was this a 'Nokia' problem or an 'Elop' problem. Would things get better once Microsoft took ownership of the troubled handset division. I wrote the clear preview of what to expect once Elop was back at Microsoft running this unit. And i said h'd be fired.

Its fair to say I saw it call coming and those of you who have been here with me, have read those same words as I wrote them, whether you believed me at the time or not. At least I hope I was able to prepare you for the shocking news as it eventually emerged. It has been a sad sad episode in tech history, how one incompetent CEO destroyed his company (to collect a personal bonus for doing so). As I said, my thoughts are with all those professional competent successful Nokia employees who were NEEDLESSLY fired because of this moron. Good roddance. The word Elop has now a meaning 'ultimate incompetence in management'

Comments

[Bob Green]

Nokia blundered and set it's own fate well before Elop. My Finnish friends laughed at America and Apple and gave away the U.S. smartphone market and it's dominance with phone carrier partnerships. They said China and emerging markets for cell phones was more important. I said 'are you crazy, China will rip you off and out compete you so it's the wrong direction.' Nokia's software was not up to par and they could't match Apple and Android. It was a last ditched crapshoot to partner with Microsoft who wants hardware with software. Don't blame Esop who pulled off a lucky sale. Blame yourselves. Guess its time to stop calling Americans stupid. Innovate don't belly ache.

[Spawn]

@Crun Kykd

> Phones are just one device - an important one - but not the only one for the perpetual future.

Microsoft: "Mobile first, Cloud first"

Note the order and there is no "Mobile and other devices". Its all about mobile. Microsoft knows it. Its the first thing, the very first word, before Cloud.

You ma have missed last month but Microsoft shifted away from Windows to Android and iOS. Read up on why Ballmer & Elop got gone and what Satya does. Open your eyes :-)

[NO ONE WANTS WINDOWS]

Hey we have tag team microsoft astroturfers again: we have the cheerleading astroturfer idiot still waiting for moore's law and his new side kick "Crun Kykd". Welcome Crun Kykd to the blog as a new microsoft astroturfer. Are you here to help Baron95? ...or provide us more microsoft propoganda material to ridicule. LoL!

Here is some reading for you to get you up to speed:

http://www.extremetech.com/mobile/199817-windows-phone-10-is-dead-before-it-even-arrives

oldies but goodies at:

http://semiaccurate.com/2015/05/04/microsoft-just-palmed-mobile-market/

https://semiaccurate.com/2015/05/06/details-microsofts-self-palming/

Ok astroturfers: spin on your toes and loudly shout

NO ONE WANTS WINDOWS ON A PHONE!!!!! ... :-)

[RottenApple]

@Baron95:

"Platforms that are doing great (Xbox, mouse, keyboard, etc), doing average (Surface) and doing poorly (Lumia) are all now all under the Widows platform executive. "

Indeed. It's very clever, now that everything is just one division they can shut Lumia down without anyone giving a shrug or the need for a major corporate announcement. Sure, they'll run a final Hail-Mary-Pass with trying out Windows 10, but if that also fails (which it most likely does), the plug will be pulled. They just have to cease production and that's it.

This wouldn't have been doable with the old structure. With that setup shutting it down would have caused a major earthquake.

[NO ONE WANTS WINDOWS]

The astroturfers would like us to believe that microsoft product line is doing fine ...TOTAL NONSENSE and totally laughable propaganda from the microsoft astroturfers trying to make an abusive monopoly look relevant outside the desktop. BIG FYI, Just check out the recent press for X-box as one example.

http://www.cheatsheet.com/technology/why-the-xbox-one-is-still-struggling.html/?a=viewall

http://www.neowin.net/news/microsoft-has-only-itself-to-blame-for-kinects-failure

BTW, is there something that X-BOX is "WAITING FOR" too ...like "PROFITS" or maybe Moore's law ...LoL

Ok astroturfers: wag your finger and repear after me.

NO ONE WANTS WINDOWS ON A PHONE!!!!! ... :-)

[RottenApple]

@Baron 95:

"and mostly that the content (apps, games, music, photos, videos) should move seamless as the user moves around these devices."

Just too bad that each one of them has a vested interest to ensure that this kind of freedom remains among devices of the same manufacturer.

If this is what they are after it may well be disrupted by the one who manages to create a truly universal system where content can be moved around without ANY limitations.

So by that reasoning they all failed big.

[Spawn]

@baron95

> Mobile does not mean mobile phones.
> But mobility means all of it.

You finally seem to get it except the confusion about mobile phones vs smartphones, but close enough :-)

And thats why Android and iOS turned into an absolute focus for Microsoft. They cover Windows but since mobility means, in the fast majorit of cases, Android and iOS, its not enough any longer. Windows is just another platform now and Microsoft adapted. The king is dead, long live the king!

[Crun Kykd]

After a period of plateauing, mobile hardware is being relentlessly improved again. This is being driven by the much higher demands for screen resolutions and graphics rendering speeds driven by the needs of AR/VR. You'll see massive investments by the cpu houses, display companies, and the graphics shops to get in on the upcoming boom. Previously all the focus was on camera megapixels, handset costs, battery life, and number of apps. They'll now move over for efforts to package full speed gaming console capabilities into mobile formfactors.

[RottenApple]

@Crun Kykd:

Maybe, maybe not.
At the same time the ASP of smartphones is falling, because most users have absolutely no need for such cost driving features. Non-casual gamers constitute a fringe minority among smartphone users. For regular app use all this graphics power is just wasted.

I'm quite sure that most people would very much prefer some longer lasting battery than more energy wasting features. THAT's the sore spot that needs to be addressed, not shoving more and more power into a phone.

[Crun Kykd]

@RottenApple It may be true that most people need longer lasting batteries versus more energy-wasting features. But that is baked into the market already with all participants (android) fielding the same cpus, os's, apps, etc. It is now, and has been for awhile, a race to the bottom - a commodity industry. And all mature industries with no meaningful differentiation turn into races to the bottom with operational excellence the only basis of competition - whoever can be the cheapest. You can see how it's playing out here by just seeing how much profit has left the industry.

By contrast, anytime some new cool thing shows up and catches the public's imagination, there is profit to be had again by the earliest leaders. This is the case with AR/VR mobile headsets. Any modern smartphone can potentially be such a device. Consider, $35 worth of plastic and cardboard turn a smartphone into being able to see 3D VR videos.

In fact, Google will be adding cardboard-ready 3D videos to youtube very shortly. If your phone can't play them, it won't matter much that it is $100 cheaper and has longer battery life. Your customers will be missing out on the newest mobile sensation (kinda like not having GPS in the early days).

And more to the point, manufacturers will enjoy higher margins, versus zero margins, if they can field high-end VR handsets. They will follow the money.

Some interesting ramifications are that high bandwidth data transfers will become increasingly important - wifi for now. How important will carrier support with their too slow LTE be in this future reality?

[RottenApple]

Seriously, how many geeks are out there?
The vast majority of people has no need for these costly gimmicks, they want a phone that they can talk with, surf the internet with and run the occasional app without running out of juice.

That's certainly not innovative or insuring good profits, but that's where things will head.
The current market is rather lopsided towards expensive devices for the sole reason that only two or three years ago the affordable low-price phones were rather poor at these things.

I still have a 5 year old HTC Desire lying around. When it was released this phone was almost top of the line, today it cannot even hold up with a bargain bin offering. But 5 years ago this was the entry point for having something usable. Only now people start to realize that they do not need to spend this much money to get a phone that will serve their needs.

Yes, it will be a race to the bottom, and this race to the bottom will continue if the manufacturers continue to ignore important features and instead focus on useless gimmicks that only a small minority of customers will ever use and that make everyday use of the phone harder.
The actual problem here is the tech press. Tech journalists are not impressed by mundane but useful stuff, they drool over those latest gimmicks - but in the process forget what the needs of the general public are.

[Ben]

Only 4 years, 4 months, and 9 days late but hey, better late than never right?

[Ben]

Someone should contact The General and ask him if he'd license his face for a new line of Voodoo dolls. I'd buy one of those over a Windows Phone any day.

[Tomi T Ahonen]

To all about Microsoft's ex Nokia Phone business

Motley Fool has an excellent analysis today on the valuations in the Nokia deal for Microsoft. While the deal was reported at a value of $7.2 Billion, Microsoft actually claimed nearly $10 Billion onto its balance sheet from the deal which now sits there, waiting to be realized - or as Motley Fool predicts, written off. So worst case, about $10 Billion dollar writedown coming from Microsoft. Very interesting analysis and breakdown of what all is involved, go take a look at

http://www.fool.com/investing/general/2015/06/25/microsoft-investors-should-brace-themselves-for-th.aspx

Tomi Ahonen :-)

[RottenApple]

@Wayne Brady:

Microsoft's entire hope is that universal apps catch on.
If they don't, they may as well shut down phone manufacturing for good.

Of course, why bother making universal apps? Desktop users want desktop software so we are right where we left off: an ecosystem with so little market share that nobody develops software for it.

[chithanh]

Satya Nadella wrote to Microsoft employees yesterday: "We will need to innovate in new areas, execute against our plans, make some tough choices in areas where things are not working and solve hard problems in ways that drive customer value."
Tough choices means there is something on the chopping block, and Windows Phone (along with a few other divisions like Xbox and Bing) is an area where things are not working.

[Per "wertigon" Ekström]

Don't think the X-Box division is in any danger as of right now (it bled money sure but now it is profitable atleast). But yeah, Phones and Bing are in trouble indeed. :)

[Henrik Nergard]

Nadella may shut down the Lumia unit in time. Or sell it. But it are now confirmed by adDuplex that two Lumia flagship are in a testing process. So my guess is he will release those in autumn with Windows 10 mobile.
It may be a failure, bit he will give it a last try.

[RottenApple]

For all intents and purposes, right now is not the right point in time to shut it down.
Microsoft spent a lot of effort on stuff to solve the app shortage problem, so they need at least the time to see how this plays out, any other decision right now would be economically stupid.

But since nobody seriously expects this to work out - I consider Nadella smart enough to read the press and get the reception of these features - it's only a matter of time.

[chithanh]

New numbers from Samsung: They sold 1 million Tizen Z1 smartphones in India in its first six months, which is around 2.5% market share. They are already at more than half of WP's share (4.5%).