It's been a topsy-turvy couple weeks for Microsoft (NASDAQ:MSFT) CEO Satya Nadella and team. Nadella kicked things off on June 17 by announcing changes in Microsoft's executive management team. He showed four senior folks the door, including Stephen Elop, the one-time head of Microsoft's Office unit, then Nokia CEO, and then back with Microsoft running its devices division. Until a couple weeks ago, that is.
Devices has now been rolled into the Windows unit, led by Terry Myerson, and is charged with bringing Windows to multiple platforms and building Lumia smartphones, Surface tablets, gaming consoles, and a host of other goodies.
As if the management changes weren't enough to get the rumor mill going, Nadella followed that up with his now-infamous mission statement email to Microsoft employees. Add to that recent rumors involving a supposed shift to Google's (NASDAQ:GOOG) (NASDAQ:GOOGL) Android OS for its smartphones, and before you can say "mobile first," several industry pundits are suggesting Microsoft is ditching its mobile devices altogether.
Not so fast.
What did he say again?
While the recent changes and announcements were the primary catalysts for the rumors that have been circulating of late regarding the mobile business, news that Nadella -- along with Microsoft co-founder Bill Gates -- had initially opposed joining the mobile playing field at all prior to the acquisition of Nokia's handset business has also factored into the mix.
Now, fast-forward to last week's email from Nadella detailing Microsoft's new mission statement, in which he said, "We will need to innovate in new areas, execute against our plans, make some tough choices in areas where things are not working and solve hard problems in ways that drive customer value." Making "some tough choices," in particular, opened the door for suggestions that Nadella's email was laden with subtle hints that Windows Phone and the Lumia smartphone lineup were on the chopping block.
Now, yet another rumor has surfaced "supporting" the anti-mobile mantra. The latest scuttlebutt is that Microsoft will forgo Windows Phone and opt for Android OS for its phones in exchange for Windows-designed Google Maps, YouTube, and search.
Some have also suggested that Microsoft is preparing to write off the Nokia deal altogether. After taking a one-time hit of about $9 billion to $10 billion, so the "suggestion" goes, Microsoft would then be free to sell its smartphone unit.
What he really said
Nadella has made clear on several occasions, though some tech industry gurus can't seem to wrap their arms around the concept, that Microsoft's "mobile first" objective goes well beyond devices. Making Microsoft's suite of products and services compatible with all devices, regardless of manufacturer or operating system, has always been the plan, but not in lieu of the company building its own mobile devices. As Nadella said in his mission statement, Microsoft's mobile-first objective will be accomplished using "Windows device platform and our devices."
Ditching Windows Phone for Android makes the least sense of all the rumors. With the anticipated late July release of Windows 10, an OS that many proclaim will transform a smartphone into a computer, why in the world would Microsoft look to Android, or anyone else for that matter? Developing Windows with compatibility to run Android and iOS apps, as Microsoft has done, is part of its mobile-first strategy, not a precursor to phasing out its own mobile OS.
There's simply not enough in Nadella's mission statement -- which can be read in its entirety here -- to warrant rumors that Microsoft is doing away with its smartphone OS or manufacturing unit, even when combined with the other "indicators." Who knows what the future holds, but don't expect Nadella to ditch smartphones anytime soon. Despite the need to make "tough choices," that's not what mobile first is about.
Tim Brugger has no position in any stocks mentioned. The Motley Fool recommends Google (A shares) and Google (C shares). The Motley Fool owns shares of Google (A shares) and Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.