"I don't think [the new strategy] will make a significant change in Microsoft's fortunes," said Dawson.
He cited Nadella's email. "We plan to narrow our focus to three customer segments where we can make unique contributions and where we can differentiate through the combination of our hardware and software," Nadella wrote. Those segments: business customers, value-oriented buyers and loyalists, in this case those dedicated to running Windows.
But that's no focus at all, Dawson argued. Those are the customers all smartphone makers, excepting Apple, target; they're the very customers Microsoft has itself chased for years.
In the end, Dawson foresaw Microsoft discarding all its phone hardware business. Gold said the same. The write-down, Windows 10 and a truncated portfolio are only way-stops to the inevitable. "I suspect [Wednesday's] move is just another step along the road that eventually leads to an abandonment of this business, even if Microsoft isn't ready to concede defeat today," said Dawson.
That's not necessarily a bad thing. "If they really shut it down, it could be a positive long-term," said Gold. He contended that exiting the low-margin hardware business and devoting resources to software and services, with their bigger profits, would do Microsoft's balance sheet good.
"If Microsoft does [exit the smartphone hardware business], I think it is diminished," said Moorhead. "It will have lost a position of power. With the device and the OS, you can call a lot of the shots, as opposed to chasing the other ecosystems."
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