Satya Nadella was not in favor of Microsoft’s ridiculous $7.6 billion Nokia acquisition

By Maryam Dodhy on
September 26, 2017
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Turns out Satya Nadella did not want Microsoft to acquire Nokia and considered it a $7.6 billion mistake. He talks about the big mishap and other interesting personal and professional stories in his new book ‘Hit Refresh’.

When Bill Gates stepped down as the CEO of Microsoft, his role was filled by Steve Ballmer who pitched the idea that Microsoft should dive into the mobile business by acquiring Nokia. Satya Nadella, then a top Microsoft executive, advised Ballmer against the decision and even Bill Gates tried to talk Ballmer out of this decision. When a vote was conducted, Nadalla voted “no”.

In his book he states,

“I voted no. I did not get why the world needed the third ecosystem in phones, unless we changed the rules … But it was too late to regain the ground we had lost. We were chasing our competitors’ taillights.”

This is the first time he has publicly acknowledged his disapproval of the 2013 Nokia acquisition.

However, when the $7.6 billion deal was eventually finalized, Steve Ballmer had resigned and Satya Nadella was left to clean the mess. Under Nadella’s leadership, Microsoft released one new flagship Windows phone called the Lumia 950 but soon after that they started to wind up the mobile business which had cost them millions of dollars and also resulted in massive employee layoffs, something which Nadella regrets the most.

“In retrospect, what I regret most is the impact these layoffs had on very talented, passionate people in our phone division,” Nadella writes in his memoir.

In 2016, Microsoft sold its mobile business to HMD Global for just $350 million, who is now trying to revive Nokia.

With Nadella in the CEO position, Microsoft has focused more on building apps and services and its cloud business. However, a quote from Nadella in the book does hint that Microsoft could dive into the mobile business if it has something unique to offer.

“Buying a company with weak market share is always risky. We should only be in the phone business when we have something that is really differentiated,” he says in the book.

Who knows, we may see a ‘Microsoft Surface Phone’ soon.

[Image Source International Business Times]

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