Finland accuses Microsoft of breaking jobs promises

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Finland accuses Microsoft of breaking jobs promises

Nordic nation hit hard by job cuts.

The Finnish government has accused Microsoft of breaking its promises to the Nordic country, in the wake of deep job cuts that have followed the software giant's acquisition of Nokia.

Politicans said Microsoft has turned its back on a promise to maintain a data centre and R&D jobs in the country.

Earlier this week Microsoft announced it would cut up to 1850 jobs - 1350 of them in Finland - in a move seen as effectively putting an end to the company's development of new phones.

Microsoft said it would continue to develop the Windows 10 platform and support its Lumia smartphones, but gave no comment on whether it would develop new Windows phones.

Microsoft bought the troubled phone business in 2014 from Nokia, Finland's biggest company. Initially, the company also talked about setting up a data centre in the country.

"I am disappointed because of the (initial) promises made by Microsoft," Finnish Finance Minister Alexander Stubb said in a parliament plenary.

"One example is that the data center did not materialise despite the company's promise."

The decline of Nokia's former phone business and the lack of substitute jobs is the main reason for Finland's current economic stagnation.

The government said it would have 'serious talks' with Microsoft over how the company could help those laid off to find new jobs.

"The company must bear as big a responsibility as possible over what they have done by laying off people," said Employment Minister Jari Lindstrom.

Nokia dominated around 40 percent of the world's mobile phone industry in 2008 before it was eclipsed by touch-screen smartphones made by Apple and Samsung.

As a result, Nokia and Microsoft slashed thousands of Finnish jobs over the past decade. The global market share of Windows smartphones fell below 1 percent in the first quarter of 2016, according to research firm Gartner.

Remaking Microsoft, known primarily for its software, into a more device-focused company was a hallmark of previous chief executive Steve Ballmer. Ballmer agreed to buy the phones business in 2013 for about 5.4 billion (A$8.4 billion), but he was replaced by Satya Nadella before the deal was closed.

Nokia, for its part, was hailed on Thursday for its successful moves to sell the phones and restructure into a global leader in the telecom network equipment industry.

"(Nokia board chairman Risto) Siilasmaa should be given a medal. The Microsoft deal can be considered as one of the best in Finnish industrial history," Arno Ahosniemi, editor-in-chief at Finnish business daily Kauppalehti, said in a column.

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