Microsoft just announced that it is writing off $7.6 billion of its acquisition of Nokia last year in 2014.
It seemed just not long ago that Steve Ballmer had proudly announced, together with Stephen Elop that Microsoft is transforming itself into a hardware and service company. The interesting thing about this announcement was that just one month into buying Nokia, Steve Ballmer left Microsoft and passed his baton to Satya Nadella.
When Steve Ballmer made the announcement, it seemed that it makes sense. Apple was at the top of its hardware game and in order for Microsoft to win the race, Microsoft would need to enter into this game.
Microsoft has been an arch rival of Apple, since as you know, when there was something called the personal computer. By buying Nokia, it was to say that Microsoft was serious about mobile. Just like saying that Apple was still its arch rival.
Satya realised that it could never win the mobile phone war. This announcement is its admission that it will not be able to compete with Apple and Samsung.