The results of the Microsoft Mobile division are under Microsoft’s expectations and many suggest the division might close. Microsoft Lumia and Nokia feature phones are currently operating under this division, and one of them might end up over at Foxconn.
While Windows 10 smartphones might be integrated in the Surface family, Nokia might become just a brand Foxconn will use to launch other feature phones in the future.
With just 15 million sold units in the first quarter of 2016, Microsoft seems to drift away from this segment of the market. Microsoft owns the Nokia brand until 2024, and until then it is very possible for Microsoft to allow Foxconn to build future Nokia smartphones. This means that Microsoft will save up on work force for the development of these phones and this may also result in a number of people losing their jobs.
Rumor has it that almost 50% of the people currently working in the Microsoft Mobile division will lose their jobs and the other half will be integrated in the Surface team in order to build new Windows 10 Mobile smartphones.
Microsoft has tried lately to refocus the strategy for the mobile market by focusing more on the corporate segment of the market and somewhat ignoring home users.
Even if Microsoft will stop building Nokia phones, the company will continue to own the brand and Foxconn will just be granted a license to use the Nokia name. Ever since 2014 when Nokia was transformed into Microsoft Mobile, the division had to fire 18,000 people and the number will go up if recent information turns out to be accurate.
We think it’s better for Microsoft to simply cut its losses and exit the smartphones market altogether. What do you think ?