Plant in Salo is shutting down as Nokia acquisition continues to bite Microsoft
Microsoft has confirmed it will shut down Nokia’s former handset development plant in Salo, Finland with the loss of up to 2,300 jobs, according to Reuters.
The redundancies are part of 7,800 worldwide cuts announced in July, following the write-off of £4.9 billion worth of assets relating to the £4.6 billion acquisition of Nokia’s devices and services unit in 2014.
Two other Finnish sites acquired in the transaction in Espoo and Tampere will remain open, but the closures are likely to be felt hard in the country, for which Nokia was once such a source of pride and prosperity.
Microsoft job cuts
Windows Phone is effectively being killed off by Windows 10, while the Microsoft Devices Group (MDG) is being absorbed into a new division, the Windows and Devices Group (WDG). Former Nokia CEO and MDG head Stephen Elop, who at one time was tipped as a successor to Ballmer, is the highest profile casualty of this restructuring and will retire from Microsoft.
Recent figure from Gartner show Windows has just a 2.5 percent share of the global smartphone market, but Nokia’s feature phones are still popular, with Microsoft the world’s third largest mobile phone (both feature phones and smartphones) manufacturer behind Apple and Samsung.
Nokia (the bits that Microsoft didn’t buy) has confirmed plans to return to the smartphone market in 2016 when the no-compete clause included in the terms of sale of its handset unit expires. Instead of returning to direct manufacturing, Nokia will licence smartphone designs to third party manufacturers.
It has even been hoped that it might pick up some of the talent and facilities being dispensed by Microsoft, although it is unclear whether Nokia has any such intentions.
TechWeekEurope has contacted Microsoft but had not received a response at the time of publication.
Do you know all about Nokia? Take our quiz!