Microsoft Signals Change in Mobile Manufacturing Plans with 18,000 Nokia Jobs Cut
“Microsoft Chief Executive Officer Satya Nadella kicked off one of the largest layoffs in tech history on Thursday [July 17], hoping to reshape the aging PC industry titan into a nimbler rival to Apple and Google, and jolt a culture at the company that is used to protecting its existing Windows and Office franchises,” according to Reuters.The layoffs, which didn’t come as a surprise to many analysts, will begin with around 18,000 jobs – many of which represent redundant, post-acquisition positions from Nokia’s mobile staff. The cuts will account for a loss in more than 14 percent of Microsoft’s total employment numbers.
The downsizing represents more than half of the original 25,000 employees that were brought from Nokia in the Microsoft takeover.
The Washington Post notes, “Stephen Elop […] told his staff where the bulk of cuts will take place in a memo of his own on Thursday. He said that the firm will decrease its presence in San Diego, Beijing, Dongguan, China and Oulu, Finland. Microsoft will also phase out all operations in Komaron, Hungary. It will also stop making phones for Google’s Android operating system.”
Elop, Microsoft’s Executive Vice President, and former pre-acquisition Nokia CEO, addressed the employees in an email that is now posted on the company’s website.
One of the key takeaways was Microsoft’s distancing from the Nokia brand: “Whereas the hardware business of phones within Nokia was an end unto itself, within Microsoft all our devices are intended to embody the finest of Microsoft’s digital work and digital life experiences, while accruing value to Microsoft’s overall strategy. Our device strategy must reflect Microsoft’s strategy and must be accomplished within an appropriate financial envelope. Therefore, we plan to make some changes,” Elop wrote.
The changes will reflect in not only the company’s mobile landscape, but in its manufacturing operations, as well. Many of the company’s engineering and manufacturing units will be relocated as a result.
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