Failed Nokia Experiment Cost Microsoft Over $8 Billion

Last week Microsoft began taking out the feature-phone bits of Nokia which it found void of value and cumbersome. Now it is reportedly taking out the remainder, namely the smartphone business of the deal too, which could indicate that the smartphone race could very soon be officially over for Redmond.

According to The Verge, the company is writing off $950 million from its business, just a year after it announced write-offs of $7.6 billion. It will also be cutting 1,850 jobs (to add to 7,800 of that time), retaining just a fraction of employees it inherited from the Finns.

Overall, it took losses of more than $8 billion, just two years into the deal, a shocking amount especially if you consider the optimism shown by both the parties when the deal would sign. In hindsight, the deal would probably go down as among the worst-managed in Microsoft’s history.

Microsoft’s phone business wasn’t helped by the fact that it came under a CEO who departed soon after the deal was announced. Under Satya Nadella, the company made a pledge to move away from the core of the smartphone race, resulting in the ouster of Stephen Elop, the infamous Nokia chief.

Initial predictions for Windows Phone were eerily optimistic and unrestrained. Gartner for one predicted Windows Phone as getting a fifth of the smartphone market by 2015. If anything, it was Android which took most of the share and Windows Phone had to succumb to less than a percent of the market as of today.

Microsoft’s smartphone adventure may be over, but at least if you are one for nostalgia, you will get to take your Nokia now.