Microsoft CEO Satya Nadella is the third chief executive of the software giant to acknowledge the company's significant mobile blunders. Nadella succeeded former CEO Steve Ballmer in 2014 and, just over a year later, wrote off $7.6 billion in relation to Microsoft's acquisition of the Nokia phone business.
In an interview with Business Insider, Nadella conceded that Microsoft's departure from the mobile phone business could have been handled more effectively. When asked about a strategic mistake or erroneous decision he might regret, Nadella responded:
"The decision I think a lot of people talk about – and one of the most difficult decisions I made when I became CEO — was our exit of what I'll call the mobile phone as defined then. In retrospect, I think there could have been ways we could have made it work by perhaps reinventing the category of computing between PCs, tablets, and phones."
Several years after the write-off of the Nokia phone business, Microsoft finally confirmed the demise of Windows Phone. However, it became evident six months after this decision that Windows Phone was coming to an end. Though Microsoft has since introduced its Android-powered Surface Duo and Surface Duo 2 handsets, the absence of a successor and a dearth of software updates raises uncertainty regarding the future of the Surface Duo.
Nadella is now the third Microsoft CEO to admit to the company's mobile missteps. Microsoft co-founder and former CEO Bill Gates expressed that his "greatest mistake ever" was Microsoft losing to Android. Google acquired Android in 2005 for $50 million, and former CEO Eric Schmidt revealed in 2012 that Google's initial focus was on outperforming Microsoft's early Windows Mobile efforts.
Former Microsoft CEO Steve Ballmer was also slow to react to the threat posed by Android and the iPhone, as he directed the company's efforts towards Windows Mobile and famously remarked that the iPhone was "the most expensive phone in the world and it doesn't appeal to business customers because it doesn't have a keyboard." In 2013, Ballmer admitted regret for not prioritizing the phone earlier. He explained, "I regret there was a period in the early 2000s when we were so focused on what we had to do around Windows [Vista] that we weren't able to redeploy talent to the new device called the phone. That is the thing I regret the most."
Over the past decade, Microsoft has shifted its focus to developing apps for Android and iOS. The company constantly updates its Phone Link app to establish connections between Android and even iPhone devices with Windows. Furthermore, Microsoft maintains a close partnership with Samsung to ensure that its mobile Office apps come preinstalled on Samsung's Android handsets.