In what is being seen as a surprise move, Microsoft Corporation (NASDAQ:MSFT) is making job cuts at Microsoft HQ and in the company’s global workforce. As part of the Microsoft layoffs in 2018, the company’s headquarters in Redmon, Washington will see an as-of-yet undisclosed number of job cuts. The Washington layoffs will mainly be in the Microsoft Windows and Devices Group, with employees being let go largely due to the failure of the Windows phone.
This is the first round of Microsoft layoffs in 2018, and it is likely to be one of the smaller ones. Of course, “smaller” is all relative, since the company employs well over 100,000 people around the globe. While the exact number of Microsoft layoffs in 2018 has yet to be confirmed, reports are coming in that it will likely be in the hundreds.
Although the most severely impacted part of the business is the Windows and Devices Group, several other divisions faced job cuts as well. Employees were shed from product groups like “Bing”—the company’s oft-maligned search engine answer to “Google.”
Decline of Windows Phone, the Flagship Product of Microsoft WDG
The company recently faced a disappointing run with its Microsoft “Windows Phone,” likely leading to the majority of the job cuts in the Windows and Devices Group. That phone officially died in late 2017.
The Microsoft Windows Phone was always facing an uphill battle. Considering the dominance of “Android” and “iOS” platforms for mobile phones, the company was in store for a tough battle to establish itself against two already-prominent consumer options.
The strength of iOS and Android phones proved to be too much for Microsoft’s fledgling mobile platform, leading to the company’s total dissolution of that product. The Microsoft Windows and Devices Group was largely responsible for that device, which is likely why it was targeted in the recent Microsoft layoffs in 2018.
The death of the Microsoft Windows Phone seemed inevitable to those watching the numbers. In December 2017, Android continued to dominate the industry, with a market share of 68.39%. iOS followed behind, with a respectable 30.56% of the market share. As for the Windows Phone, it had a paltry 0.15%.
The failure to make headway into the phone market created a feedback loop for the company, in which it couldn’t get enough users to entice app-makers to use the platform, while the shortage of apps likely dissuaded potential buyers from jumping on board, reducing the number of users further. The vicious cycle continued until the eventual death of the phone.
Joe Belfiore, corporate vice president in the “Operating Systems Group,” played a significant role in the development of the platform for the Windows Phone. He recently sparked controversy when he was seen using both an iOS device and an Android phone.
“I switched platforms for the app/hw diversity,” he wrote in a tweet following the death of the Windows Phone. He further wrote that Microsoft would continue to support all mobile platforms, but that Windows 10 Mobile was no longer a priority for the company.
“We have tried VERY HARD to incent app devs. Paid money. wrote apps 4 them.. but volume of users is too low for most companies to invest,” wrote Belfiore in another tweet.
As a final dagger to the hopes of the Microsoft Windows Phone, what few apps the company did support began abandoning the platform near the end. One of the most prominent examples was The New York Times canceling support for its Windows Phone app in December 2017.
“Microsoft Cuts More From its Payroll, Layoffs Across Several Orgs,” Petri, January 22, 2018.
“Joe Belfiore reveals why Windows Phone is dead,” Windows Latest, October 9, 2017.
“Windows Phone market share collapses to 0.15%, according to NetMarketShare,” Windows Latest, January 4, 2018.
An Update Regarding Our Windows Phone App,” The New York Times, December 27, 2017.