Friday, May 12, 2017

DEAD! Cherish your Windows Phone NOW as none will come again!

If you've been expecting Microsoft to issue a press release formally announcing the end of its Windows phone business, you're probably hoping for a bit too much. But make no mistake: its phone hardware business is dead.
Some fans, and even some in the media, have consistently refused to acknowledge this, despite the clear signs in recent quarters. Now, Microsoft's own figures, and its statements regarding its phone division, should make it irrefutably clear that there is no life left in its Windows phone business.
For anyone who's been paying attention, this shouldn't be a surprise. All of Microsoft's 'latest' Lumia Windows phones are now well over a year old, with no sign of direct replacements. In many markets, these devices have been out of stock for weeks - or even months, in some cases. Meanwhile, the new Windows 10 Mobile Creators Update supports only a handful of devices, and delivers only a small number of relatively minor improvements, despite some more significant additions being promised.
During the quarter ending in December, Microsoft's phone revenue dropped to just $200 million, which included some sales of feature phones, before the company completed its sale of that business unit to Foxconn in November. That figure has now dropped to virtually nothing.
According to the company's 10-Q filing to the SEC for Q3 FY2015, its phone hardware revenue for that quarter totalled $1.397 billion. One year later, in its 10-Q for Q3 FY2016, Microsoft said that phone revenue had fallen by $662 million, reducing it to $735 million.
As Microsoft published its earnings report for Q3 FY2017, it revealed that its "Phone revenue declined $730 million". Based on its earlier financial disclosures, that means the company's phone hardware revenue fell to just $5 million for the entire quarter ending March 31, 2017.
A few days ago, it was pointed out how the latest version of Microsoft's 10Q document filed with the SEC appeared to call "time of death" for Windows Phone. In a section of the document listing current business activities, Windows Phone no longer appeared after it had showed up in the previous quarter's 10Q. With a microscopic market share and no new Microsoft branded Lumia phones released since 2015, it has been left to third party manufacturers like HP and Alcatel to keep Windows 10 Mobile alive.
In a published interview with MarketPlace, Microsoft CEO Satya Nardella says that Microsoft will return to the hardware business when it comes to smartphones. But he added that these would be devices that break the mold, like the Surface line did. (Hmm, Surface Phone anybody?). The executive explained that Microsoft is still in the smartphone business with its iOS and Android apps. And of course, there is that portfolio of Android patents that brings home the bacon.
When it comes to hardware, Nadella makes it clear that Microsoft is looking for something new. "So in some sense when you say will we’ll (sic) make more phones, I’m sure we’ll make more phones, but they may not look like phones that are there today," the CEO said.
"We make phones today, we have OEMs like HP making phones and others and we picked a very specific area to focus on which is management, security, and this one particular feature that we have called Continuum, which is a phone that can even be a desktop...and at this point, we’re making sure that all of our software is available on iOS and Android and it’s first class, and we’re looking for what’s the next change in form and function. What we’ve done with Surface is a good example. No one before us thought of 2-in-1s and we created that category and made it a successful category to the point where there are more 2-in-1s coming. And that’s what we want to do."-Satya Nadella, CEO, Microsoft.

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