Microsoft CEO Satya Nadella has said “big changes” need to be made at the company. Nadella has been revealing more about the future of the company and this week’s announcement will pave the way for the new Microsoft.
This new set of layoffs will be the largest Microsoft has ever seen, dwarfing the 5,800 jobs cut in 2009. The majority of the layoffs, expected to be around 30,000, will come from the recently acquired Nokia smartphone business.
Microsoft acquired Nokia’s hardware division for $8.6 billion last year, when Steve Ballmer was still in charge of the company. It appears Nadella has no plans to continue the hardware business, at least to the scale it is at currently.
There have been rumors of the Nokia brand becoming less meaningful in the coming years, as Microsoft looks to keep working on the Surface for tablets and a new brand for first party smartphones, potentially moving away from Lumia.
If this is the road Microsoft is going to go down, it is an even bigger blunder than Google acquiring Motorola and then subsequently laying off most of the staff. Nokia was a successful attribute to Windows Phone, without the manufacturing line that is the biggest OEM partner taken away from the mobile OS.
Perhaps this will open Windows Phone up to other manufacturers like Samsung and HTC, now they know their market share will not be dwarfed by Nokia. The brand might still continue however, just under different manufacturing, potentially in China.
Satya Nadella is expected to announce something today or potentially tomorrow, depending on when Microsoft feel comfortable releasing this information. We expect a private announcement to have already been made within the company, following these leaks.