Cutting Jobs, Microsoft Turns Page on Nokia Deal

When Microsoft announced its deal to acquire Nokia’s mobile phone business, Steven A. Ballmer, Microsoft’s chief executive at the time, boasted that the deal was a “bold step into the future.” But on July 8, Microsoft’s current chief executive, Satya Nadella, sought to leave that deal in the past. He announced a broad rethinking of the company’s phone strategy, a change that includes cutting up to 7,800 jobs, mostly from the phone business, and writing off nearly all of the value of its Nokia acquisition.

The move is a clear acknowledgment that the deal was a multibillion-dollar strategic blunder by Ballmer, who had envisioned it as a way to make Microsoft more competitive in the mobile market dominated by Apple, Google and Samsung. Nadella is said to have disliked the acquisition originally, though he publicly endorsed it after becoming chief executive.