Why bomb at mobile M&A once when you can afford to do it twice? That seemed to be the ethos for Microsoft, which in the past decade made two utterly disastrous acquisitions of smartphone makers.
In 2008, Microsoft bought Danger, maker of the classic Sidekick phone. The next year, in a colossal blunder, the company lost all Sidekick users’ personal information thanks either to a server failure or, as rumor has it, because Microsoft didn’t make a backup before bricking a SAN upgrade. Microsoft was hammered with consumer lawsuits over the debacle.
Then in 2013, Microsoft, with Steve Ballmer at the helm, dropped a cool $7.2 billion on Nokia’s phone business. Despite the bold move, Windows Phone’s share of the mobile OS market continued to dwindle until a defeated Microsoft (now under CEO Satya Nadella) announced a $7.6 billion-write off and 7,800 job cuts.
Nadella conceded it was time for Microsoft to move on from its dream of having a standalone phone business.
In its most recent quarter, Microsoft phone revenue fell by $361 million. According to IDC, Windows Phone accounted for a 0.1% share of worldwide phone shipments in the first quarter of 2017. The company is now focusing on other business areas, having essentially withdrawn from smartphones altogether.