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Microsoft reportedly lays off team focused on winning back consumers

Microsoft reportedly lays off team focused on winning back consumers


Around 200 employees affected

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A stock image of the Microsoft logo.
Image by Alex Castro / The Verge

Microsoft is reportedly laying off its team focused on winning back consumers. In 2018 the software giant originally detailed its efforts to win back the non-enterprise customers it let down, forming a Modern Life Experiences team to focus on professional consumers (prosumers). Business Insider now reports that Microsoft is laying off that team, and telling the roughly 200 affected employees to find another position at the company or take severance pay.

While Microsoft isn’t officially commenting on the end of its Modern Life initiative, a Microsoft senior designer revealed there was “hard news” for the Modern Life Experiences team this week in a LinkedIn post. The news comes weeks after Microsoft cut less than 1 percent of its 180,000-person workforce, with job cuts in consulting, and customer and partner solutions. Microsoft has also been cutting open job roles as it slows hiring amid a weakening economy.

Microsoft originally planned to win back consumers in 2018.
Microsoft originally planned to win back consumers in 2018.
Image: Yusuf Mehdi (Twitter)

Microsoft’s consumer efforts are now focused on Windows, Microsoft 365, Microsoft Teams for consumer, Surface, and of course Xbox. Microsoft originally formed the Modern Life Experiences team in 2018 after a rocky period for its consumer services. Microsoft killed off its Groove Music service in 2017, officially discontinued Kinect in the same year and also finally admitted Windows Phone was dead. The Microsoft Band fitness device also disappeared in 2016, and efforts with Cortana fell way behind rivals to the point Microsoft switched things up to chase business users instead. Microsoft even pivoted its HoloLens hardware towards commercial customers, and there are new signs HoloLens could be in trouble.

Microsoft has seen success with its Microsoft 365 subscriptions for consumers, though. Microsoft 365 consumer subscriptions grew 15 percent in the recent quarter, up to 59.7 million. Office consumer was also up 9 percent year over year, amid an increase in hybrid and remote work.

All eyes will now be on Microsoft’s hire of Manik Gupta last year, the former head of product at Uber. Gupta is responsible for Microsoft Teams consumer, Skype, and GroupMe, and he’s focused on building consumer experiences across Microsoft.

Microsoft had been trying to acquire popular communities over the past couple of years, including TikTokPinterest, and Discord, to improve its efforts with non-business users. Outside of Xbox, Microsoft doesn’t have a community or social service that’s widely used by consumers, and TikTok, Pinterest, or Discord could have filled that gap. Rivals like Google, Amazon, Facebook have all acquired big consumer apps like YouTube, Twitch, and Instagram, and Microsoft is still trying to align its consumer offerings.