In it’s largest layoff ever, new Microsoft CEO Satya Nadella has announced plans to lay off up to 18,000 workers in a “restructuring plan to simplify its organization and align the recently acquired Nokia Devices and Services business with the company’s overall strategy”. It seems that most of the job loses will be in the Nokia Devices and Services division. It also seems that this news is not limited to Nokia, as Microsoft also announced plans to eliminate the Xbox Entertainment Studios today.
While layoffs are never good news, this event doesn’t signify much for Microsoft other than a realignment to fit the vision of new leadership. Nadella is from Microsoft’s cloud group, and seems to be more interested in software and services than other parts of Microsoft’s business. Nadella also hinted at, “select Nokia X product designs to become Lumia products running Windows.” It seems like Nadella plans for Microsoft to stop production on the experimental Android Nokia devices, and focus on their own Windows Phone 8 product.
It’s been rough couple of years for Microsoft. Windows Phone 8 and Windows 8 itself can hardly be called successes. In a world increasingly dominated by Operating Systems from Apple and Google, a change in vision may be just what Microsoft needs.