Microsoft is giving up on Nokia feature phones, selling the business to FIH Mobile, a Foxconn company. Here we see the next step on the road to Microsoft exiting the phone business completely.
It's now moved from Finland, via Redmond, to China. Oh, and it's destroyed hundreds of billions in shareholder value in the process.
In IT Blogwatch, bloggers try to follow the money. Not to mention: Linux is #@&%ing Weird…
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What’s the craic? Victor Ng is lost in translation—Microsoft gonna shut down Microsoft Mobile and sell Nokia feature-phone license to Foxconn:
[We] received some inside information about another tragedy about to happen...to the Microsoft Mobile department. ... Although Microsoft has a feature phone brand license until 2024, a reliable source says Microsoft...will stop production of Nokia feature phones and will sell this brand license to...Foxconn.
In addition, Microsoft will once again adjust...the Microsoft Mobile department. [It will] layoff more than half of the...employees within a few months. [It's] actually kind of a relief, right?
Well, that was the rumor a few days ago. But now comes the confirmation, via Tom Warren—Microsoft is selling its feature phone business to Foxconn for $350 million:
Microsoft is selling [the] business to FIH Mobile. ... 4,500 employees [will] transfer over to Foxconn's subsidiary, and Microsoft [will hand] over the rights to use the Nokia brand...software, services, and other contracts.
Microsoft says it will continue to develop Windows 10 Mobile and support Lumia phones and [other] Windows Phone devices. ... Asha, Series 40, and Nokia X handsets all shifted to a "maintenance mode" [in] 2014...in a move to tempt its installed base...to Windows Phone.
That has largely failed. ... Earlier this year...Microsoft's head of Windows, Terry Myerson [said] "if you wanted to reach a lot of phone customers, Windows Phone isn't the way to do it."
Can we conclude Microsoft lost an enormous amount of money on the Nokia deal? Benedict Evans runs the numbers:
Nokia was worth $300bn. ... Now Microsoft sells on the featurephone unit - that same business, in effect - for $350m.
[That tweet] is factually correct, and well within the accuracy required to fit within 140 characters. ... A pretty small proportion of that $300bn was the network equipment business...that remains with Nokia.
Companies are worth predicted future cash flows. [It's] the end.
He's long on MSFT. But Motek Moyen waves Goodbye To Lumia:
Microsoft should also license Lumia to Foxconn. ... Mobile advertising, not mobile hardware, should be the core focus.
Let Foxconn do the gritty job of selling mass-market Lumia handsets. [It] could eke out a decent margin selling $100 Lumia phones.
The savings...will allow Microsoft to grow...its own mobile advertising business. ... Windows 10 Mobile will suffer the same walking-dead status of BlackBerry...if it only attracts business users.
Linux is #@&%ing Weird (Bryan Lunduke's latest)
[WARNING: Guns, Barbie, lacto-theft, and a few mildly-NSFW words]
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