Microsoft may need to abandon being in the devices market altogether and focus more on services, according to industry analyst Chetan Sharma. Microsoft's Windows Phone platform continues to struggle for market share globally, and though it has gained traction in some markets in Europe, Sharma wrote in a recent research report that Microsoft may need to cuts its losses given the lack of return on investment it has made in mobile.
Nokia and Harris want the First Responders Network Authority to think of them when it goes looking for rapidly deployable LTE solutions for disaster areas, rural emergency situation and extended network coverage during special public events.
No longer weighed down by its stumbling devices business, Nokia cast an optimistic outlook for its 2014 performance, with second-quarter net profit of 2.51 billion euros ($3.38 billion) offering a healthy start. Having just completed his first quarter as Nokia's CEO, Rajeev Suri told analysts during a conference call that the recently ended period was "a very positive quarter for the company."
Nokia CEO Rajeev Suri said the company's Networks business will begin delivering year-over-year growth in the second half of 2014, despite operating profit at the division slipping 14 per cent annually in the second quarter.
Microsoft on Wednesday unveiled the first Lumia-branded Windows Phone that will be sold at a price below €100 ($134), hot on the heels of news that sales of Lumia smartphones declined in the U.S.-based company's fiscal fourth quarter to the end of June.
Microsoft is going to wind down Nokia's Asha and Series 40 feature-phone businesses over the next 18 months to focus solely on devices running Microsoft's Windows Phone platform, according to an internal company memo. The decisions come as part of Microsoft's decision to cut 18,000 jobs, including 12,500 former Nokia workers, the largest restructuring in the company's history.
The job cuts Microsoft made to its Nokia devices business were not surprising, and they reflect Microsoft CEO Satya Nadella's drive to change Microsoft into a software and services company that enhances productivity for enterprises and consumers through its platforms. Devices will still be a part of Microsoft, but they will be used for a specific purpose: to showcase the best Microsoft experience, primarily in high-end gadgets.
The axe is falling for former Nokia handset workers. In its largest round of layoffs to date, Microsoft said it will cut up to 18,000 jobs this year, or 14 percent of its workforce. It is expected that many of those cuts will be to employees the company acquired when it bought Nokia's devices and services business for around $7.4 billion.
Microsoft CEO Satya Nadella laid out a manifesto for the company to move beyond the "devices and services" mantra supported by his predecessor Steve Ballmer and into an era where the software giant focuses on "productivity and platforms."
MidoNet and ParStream, which created solutions for software-defined networking (SDN) and big data analytics, respectively, were named the winners of an innovation challenge held by Nokia's networks unit, which will continue working with both companies on future offerings.