Microsoft, falling behind in mobile, see its future in the cloud

If mobile and cloud are the two key technology markets of the future, it's good that Microsoft seems to have a handle on at least one of them.

When the company reported its quarterly financial results Thursday, something stuck out of its statistics: phone hardware revenue had dropped 58 percent year over year, something the company blamed on an "updated strategy." 

It's a nice little turn of phrase that belies Microsoft's shift in focus away from operating Nokia's devices business like the Finnish handset maker used to, with a wide range of phones. Instead, the company is building a leaner division that will only turn out a few different handsets. That leanness is meant literally: earlier this year, Microsoft cut the employment of 7,800 people, primarily in the phone hardware division. 

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