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Microsoft's Nokia Plans Come Into Better Focus

Forbes has an update on what sort of future Nokia faces, as Microsoft reveals a strategy for making sense of the acquisition: [Microsoft EVP of devices Stephen] Elop laid out a framework for cost cuts in a memo to employees on July 17. Devices would focus on high and low cost Windows smartphones, suggesting a phasing out of feature phones and Android smartphones. Two business units, smart devices and mobile phones, would become one, thereby cutting overlap and overhead. Microsoft would reduce engineering in Beijing and San Diego and unwind engineering in Oulu, Finland. It would exit manufacturing in Komarom, Hungary; shift to lower cost areas like Manaus, Brazil and Reynosa, Mexico; and reduce manufacturing in Beijing and Dongguan, China. Also, CEO Satya Nadella gave hints about how Microsoft will make money on Nokia during Tuesday' conference call. Devices, he said, "go beyond" hardware and are about productivity. "I can take my Office Lens App, use the camera on the phone, take a picture of anything, and have it automatically OCR recognized and into OneNote in searchable fashion. There is a lot we can do with phones by broadly thinking about productivity." In other words, the sale of a smartphone is a means to other sales.

35 of 149 comments (clear)

  1. It's a funny world by drolli · · Score: 2, Interesting

    I am a Unix/Linux user since 1995. I used Symbian and i liked it, and i have several android devices (first was the galazy tab). Now Microsoft killed Nokia. Nokia killed Symbian.

    I am looking for a new tablet/PC currently. I tested some Windows 8.1 Tablets (Lenovo and others), and i have to say (besides the colored rectangles on the start screen): Well done
    by leaving many things unchanged. For the first time in about 20 years i consider buying a microsoft OS on an new computer (for personal use).

    1. Re:It's a funny world by Anonymous Coward · · Score: 2, Interesting

      20 years? It's 2014. So that means since 1994.
      So you've rejected Windows 95,
      and you've rejected Windows 98,
      and you've rejected Windows XP,
      and you've rejected Windows 7,
      but now, after all this time, you're embracing Windows 8.1?

      I reject you. You've got the worse decision-making that I've seen in the last 20 years.

    2. Re:It's a funny world by rvw · · Score: 2

      I am a Unix/Linux user since 1995. I used Symbian and i liked it, and i have several android devices (first was the galazy tab). Now Microsoft killed Nokia. Nokia killed Symbian.

      I am looking for a new tablet/PC currently. I tested some Windows 8.1 Tablets (Lenovo and others), and i have to say (besides the colored rectangles on the start screen): Well done
      by leaving many things unchanged. For the first time in about 20 years i consider buying a microsoft OS on an new computer (for personal use).

      I bought a laptop with Windows 8.1. I wanted to install Ubuntu on it, but still haven't got the boot process working. I use a Mac for 15 years now, OS X since 10, Ubuntu at work since five years. Although I help several people with Windows computers, I haven't used it for myself in years. In two or three days it became totally clear that Windows is not for me anymore. The same annoyances are still there. I won't say Ubuntu is perfect, not even OS X, but Windows 8.1... I can't believe how inconsequent the setup is.

    3. Re:It's a funny world by greg1104 · · Score: 3, Insightful

      You've got the worse decision-making that I've seen in the last 20 years.

      You must not have have been following the Nokia story until now then.

    4. Re:It's a funny world by drolli · · Score: 3, Interesting

      Yeah, actually i bought OS/2 instead of windoes 3.1/windows 95. In 1993.

      You forgot NT 4.0 and NT 3.51

      I did not reject windows. I did just not see any reason to switch from linux in the last 20 years and pay for a newly installed computer. I think XP is OK - were are cheap used licenses around.

      I find windows 8.1 similar enough and all the features which are mandatory for me are embedded, and the price point of the tablets seems ok.

    5. Re:It's a funny world by Stormwatch · · Score: 2

      It's not killing Symbian that angers me (although the timing was horrible and hurt Nokia immensely as well). It's killing MeeGo. It had a better chance of being a successful "third ecosystem" than Windows Phone.

    6. Re:It's a funny world by jafac · · Score: 3, Funny

      Prices have been in free-fall, unfortunately, since the beta.

      Which is sad, because that was my retirement plan.

      --

      These are my friends, See how they glisten. See this one shine, how he smiles in the light.
  2. Hit: When your business fail: set a new plan... by jcdr · · Score: 2, Insightful

    This will make the failure looking like a thing of the past and make hope for a successful new future.
    But this don't grant that this will work as expected. Especially after you use the same plan almost each 6 months for more than 3 years now !

  3. Re:Sigh, that's another waste of time then. by maligor · · Score: 2

    Was rather hoping Nokia would come back with the Android smartphones, into the EU. Unfortunately that seems to not be the case and they inside on flogging that dead horse of their own operating system. They used to make nice hardware designs.

    Nokia doesn't make cellphones anymore, the cellphone division was what was sold off to Microsoft and I don't see why Nokia would re-enter the cellphone market anymore, it's pretty saturated.

  4. Re:Sigh, that's another waste of time then. by joh · · Score: 4, Insightful

    It might work for enterprise users (I'm sure that's a /really/ big market!!) but lack of decent apps, or even popularly used apps is the nail in the coffin for me as far as their mobile Windows OS is concerned. The phone hardware was good, the OS completely lacked.

    Such a shame.

    Why does the OS lack when there's just a lack of apps? Seriously? The OS is fine.

    It's just that a THIRD platform (after Android and iOS) has very little hope of getting a foot into the door. MS obviously hopes that it can change that in the long run by fusing Windows and WP as a platform. I think the gap is too large to make this work, but it's really neither the hardware nor the OS that is the actual problem here. Still, MS has more than once proven that it has the patience to turn things around (they all but missed the Internet once and a few years later IE was moving towards a monopoly) and they surely hope they can pull something like this off again.

    I'm not very optimistic here, but the OS wars aren't over yet.

  5. Its dead Jim! by miffo.swe · · Score: 5, Insightful

    Windows mobile phone forays are dead, done, finito, kaputt and out of steam.

    Windows Phone 7 has been out for almost 4 years and still barely holds 3% market share. Thats pretty awful by any measure, especially since the platform before it had much larger market share. They lost customers with current platform without gaining any new ones.

    Windows Mobile was out 7 years and failed, and before that Microsoft failed with Pocket PC.

    I am amazed they still happily beat the dead horse instead of putting effort into supporting the winning platforms. Android will be succeeded by something in the long run and until then i fail to see the business perspective of dragging a dead horse round the racetrack with a lawn mower trying to catch up with a Jumbojet. Why not just book a seat in the Jumbojet instead?

    Personally im sure Nadella would like nothing better than to put a fork in Windows Phone, but entrenched forces inside Microsoft makes this very hard. It has to fail on its own dying a long agonizing death instead.

    --
    HTTP/1.1 400
    1. Re:Its dead Jim! by nine-times · · Score: 4, Funny

      But you haven't seen Windows Phone 9! They're going to overhaul the interface to make it work like a traditional desktop UI, requiring a full-size keyboard and mouse to operate it!

      Microsoft! What'll they think of next?!

    2. Re:Its dead Jim! by ILongForDarkness · · Score: 3, Insightful

      It's funny it is kind of the Mac v PC battle of the late 80's-90's. Platform wins. I have a Lumina 920 and it is a great phone. Win phone is fun to use. But ...: not a lot of apps for it. Not that I care much. I'm not into social media crap or a dozen other things. What it does really well right out of the box: hotmail, gmail, facebook contacts all automatically merged (after logging into the relevent apps of course) and shown in one place. It doesn't matter if someone's hotmail has their phone number but their mailing address is only saved on there FB page: it all shows up in the same contact. Dido: things like birthday's and holidays: automatically figured out and notified.

      That is pretty much all I needed from a phone: contacts in one place and access to FB for the 1-2 times a month I actually check it. But: I am not the typical smartphone user. MS missed the cool factor boat by a couple years and now have to bribe people (sometimes literally by supplying in house devs to help support a big name app get ported to the platform) to develop for it. Since people aren't sure if they can find the app they want on WinPhone they just go for an Android or iPhone. Them giving out WinPhone for free now will maybe get them a better market share in the low end phones for the developing world but: if you are giving away the software what is the point being in the business? (If you are hoping on making money on selling apps you don't want the entry level 3rd world population as your customer base either).

  6. What does unwind mean?? by will_die · · Score: 2

    In this context what does unwind mean?
    You already have "exiting" and "reducing" so it may not be a negative usage.

    1. Re:What does unwind mean?? by greg1104 · · Score: 2

      Seems to involve Elop burning another platform. I wouldn't let that man develop a "framework" to do my laundry.

    2. Re:What does unwind mean?? by wonkey_monkey · · Score: 3, Funny

      Microsoft would reduce engineering in Beijing and San Diego and unwind engineering in Oulu, Finland.

      I'd guess someone confused "unwind" with "wind-down," as in slow down (possibly to an eventual halt).

      Then again, they might have meant "wind-up," as a business synonym for closing down/ceasing operations (with the implication that this is being done in a tidy manner, rather than abruptly being forced out of business).

      Or perhaps they're winding-down before they wind-up.

      I'm not winding you up here.

      --
      systemd is Roko's Basilisk.
  7. Re:OCR by Antique+Geekmeister · · Score: 5, Insightful

    > I like the part where they are magically going to make OCR work

    I'm afraid you could have left it right there, with no mention of cell phones or their cameras. OCR, much like speech-to-text software, has plateaued and not noticeably improved in the last 10 years. It's became more available as software has become more powerful. But the underlying technologies have been quite stable. Despite flurries of new patents with every update to such software, the fundamental algorithms remain unchanged and have been stable for roughly 20 years.

  8. Re:that feature exists already by Nyder · · Score: 3, Insightful

    You can use the "Office Lens" with Windows Phone 8 phones today. Handy.

    Guess that is useful for those 3 people.

    --
    Be seeing you...
  9. I think the strategy should be obvious by DrXym · · Score: 4, Insightful

    Hollow out Nokia until its just a shell valuable only for its IP, transfer everything else worth keeping into Microsoft proper and discard the rest. Wouldn't be surprised if the "Nokia" brand gets sold onto to some Asian / Indian outfit in a few years hence.

    1. Re:I think the strategy should be obvious by Xest · · Score: 4, Insightful

      Yep, they've already announced most the staff are going, all of it's factories sound like they're going to be replaced with Microsoft's own, and it's Finnish engineering premise is being "unwound" aka shutdown too it seems.

      What is left other than IP? It seems like Microsoft just took a competitor out of the market and took all their IP - a competitor because they were still doing better than Windows Phone before Microsoft took them over even if they were falling in the face of Android and iPhone.

    2. Re:I think the strategy should be obvious by Xest · · Score: 2

      So was this done entirely to just destroy competition? I just can't see what else is being retained here.

  10. Re:Sigh, that's another waste of time then. by greg1104 · · Score: 3, Insightful

    Whether Symbian is a good platform or not involves more than just if the code is functional. Sometimes a lack of applications is driven by a more fundamental weakness in a platform. One of the reasons the iPhone and iPad have done so well courting application developers is that Apple tries to keep everyone marching in formation, moving the platform forward without leaving current customers too far behind. (Their formation, of course, but they are Apple)

    A good example is the "pixel doubing" that went into the early iPad design. That intentionally structured the design of the platform so that applications written for lower resolutions would continue working against the higher pixel counts. That's the sort of subtle thing you do to keep developers happy and application development flourishing.

    Faced with the same sort of devices with multiple resolutions problem, Android leaves the whole mess in the lap of application developers. And Nokia has just abandoned the old stuff. If you're a phone developer, how would you feel about that? A lot of things like that influence whether applications are built for a platform or not.

    And, yes, Microsoft has bullied their way into a winning position using their operating system monopoly for a long time, with IE being a good example of that. I don't think it's safe to assume that tactic will keep working anymore though. I don't know anyone who feels Windows compatibility is an important thing on their phone or tablet today. At best, I might want something that opens Word or Powerpoint documents someone sends me in an e-mail. You don't need Microsoft for that on your phone though. Their software is only needed if you expect to edit the documents with low risk of corruption, and that still happens on desktops.

  11. Mini-Nokia still thriving by jones_supa · · Score: 4, Interesting

    Interestingly, the Finnish stub of Nokia that was left, is doing fine. They still have a feasible telecommunication networks business.

  12. Re: Master Strategy by jrumney · · Score: 4, Insightful

    Microsoft's chess strategy seems to be to sacrifice all its pawns and its Queen, laying waste to its Bishops Knights and Rooks and trying to win the game with just its King left. Good luck with that one.

  13. Re:Satya by gbjbaanb · · Score: 2

    but "For Fucks Sake" doesn't spell anything like I thought you spelt his name but I guess I'll start spelling it like that if you insist.

    For completeness, how do I pronounce it?

  14. Re: Master Strategy by Cryacin · · Score: 2

    The "King"'s too busy fighting world poverty.

    --
    Science advances one funeral at a time- Max Planck
  15. still the vision of 9 years ago. by nimbius · · Score: 4, Insightful

    "thinking broadly about productivity" just means selling these things to business instead of the general public. Cobbling together a random conjecture about a common business technology, OCR, further serves to endow the commitment. Microsoft knows the only repeat customer for its services as the 21st century rolls along is going to be business.

    But thinking that Nokia plays any part in this is rather odd. Microsofts purchase basically forced moody's hand to downgrade its bond status to junk only one year after the purchase. Windows phone was, again, a flop. Blackberry used Microsofts restructuring as a brilliant tactical strategy to make a comeback in the businessworld, when it should have been the other way around. So in the future most businesses will opt for blackberry in the field, and iPhone for the C-Levels. In response microsoft, as they have with Azure, will strap heavily discounted or free phones to business licenses which in turn will be purchased by management in an effort to maintain license discounts on what they do use; namely Windows. These phones will sit on IT workbenches and in random cubes until the batteries rot and the password is forgotten because what microsoft is offering is a solution to a problem that was solved almost a decade ago. Sales will increase, microsoft will pump their nokia stock until losses in other units become unsustainable again, and we'll all collectively groan as another wave of "restructuring" crashes to shore in an effort to convince investors the ship is still sailing.

    --
    Good people go to bed earlier.
  16. This is proof by gelfling · · Score: 2

    That in any organization of sufficient size, the ass kissing retards always float to the top.

  17. Elop by Anonymous Coward · · Score: 5, Insightful

    Can someone explain to me how there hasn't been a class action lawsuit against Elop and Microsoft for his blatantly obvious tanking of Nokia intended to reduce the purchase price? How have shareholders not sued? Why aren't Nokia employees, who are about to get laid off en-masse, not contacted lawyers and sued? Seriously, this is something that was insanely obvious as soon as Elop joined Nokia - we were talking about it extensively on Slashdot - and it played out EXACTLY how we all predicted it would.

    Where are the lawsuits?

    1. Re:Elop by Stormwatch · · Score: 3, Informative

      Breach of fiduciary duty.

  18. Re: Master Strategy by Cryacin · · Score: 2

    Yes I am. The devil would have more style.

    --
    Science advances one funeral at a time- Max Planck
  19. Re:Sigh, that's another waste of time then. by ArmoredDragon · · Score: 4, Interesting

    Why does the OS lack when there's just a lack of apps? Seriously? The OS is fine.

    No, it's not. If it were just a lack of apps being ported to it, that's one thing, but that isn't it.

    The point of a smartphone (to some people such as myself) is to have a swiss army knife for information gathering. As a network admin, one of my things is being able to troubleshoot network problems. Android (and iOS as well, though I don't own an iPhone) allow for these kinds of features really well, and I can use apps like Fing and WiFi Analyzer. However the underlying OS code for those two apps cannot be done on either Windows RT or Windows Phone.

    The same story can be said for a lot of things. There quite a number of WP apps where if you read where users are complaining about why the WP version of X app doesn't support Y feature that it also does on Android, and they blame the developer for being "lazy" but the truth is that WP doesn't support the underlying feature in most cases.

  20. Same as usual, then by Sarten-X · · Score: 2

    In other words, the sale of a smartphone is a means to other sales.

    Naturally.

    Sales of Office lead to sales of Windows which leads to sales of Windows Server which leads to sales of Exchange which leads to sales of Office... Vendor lock-in has been Microsoft's core business model for decades. Why should it be different with phones?

    --
    You do not have a moral or legal right to do absolutely anything you want.
  21. Sorry to lose feature phones by Anonymous+Brave+Guy · · Score: 2

    I'm actually quite sad to read this. I have little interest in so-called smart phones. I have computers and tablets for running serious software and for web browsing. I don't use a lot of cloud services like those hosted by Google and Facebook, and I have little need for the kind of software that exists only as a smartphone app.

    So, for many years, I have just bought a cheap and cheerful Nokia feature phone. They invariably have good battery life compared to any smartphone. They are much smaller in my pocket. They run reliably for their entire useful lifetime, without breaking or shifting everything around arbitrarily during some dramatic firmware update. They don't come with the same level of creepware that smartphones from all the major brands now do. I can buy one for next to nothing at any phone shop, without signing up to pay half my salary on a phone plan with a multi-year lock-in to the same network. And they still let me do what I actually need a phone for: pushing a couple of buttons and then talking with someone, or maybe sending the occasional text message.

    I realise that smart phones rule the universe these days and I'm some sort of technological Neanderthal (aside from all the other bleeding edge tablets, computers and software I work with everyday, obviously) but I for one will miss Nokia feature phones. I guess I'll go back to hoping for a resurgent BlackBerry that at least has a business focus and therefore something resembling security and not assuming I want a Facebook icon on my home screen that can't be deleted.

    --
    If you disagree, post your argument. (-1, Overrated) isn't your personal censorship tool for views you don't like.
  22. Re: Master Strategy by cheesybagel · · Score: 2

    It was painfully obvious they only acquired Nokia because of the patents. The rest be it R&D or especially manufacturing operations is to be disposed of.