Microsoft’s acquisition of Nokia’s smartphone business didn’t turn out like either company had hoped, but five years later, some of the connections forged through the $7 billion deal are coming back around in surprising ways.
The companies themselves made headlines this week by announcing a new partnership, but the separate, lesser-known reunion involves two of the key players from the acquisition: Stephen Elop, the former Nokia CEO and two-time Microsoft executive; and Tom Gibbons, the longtime Microsoft executive who was tasked with overseeing the integration of the acquisition.
Elop and Gibbons are now working together at APiJET, a Seattle-based aviation data analytics startup formed as a joint venture of Aviation Partners and iJet Technologies. Elop was named CEO of APiJET in September, and the two former Microsoft execs are bullish on the startup’s prospects for using advances in machine learning and artificial intelligence to transform aviation.
“Take a typical airliner. It is packed with sensors,” Elop explained in an interview with GeekWire. “It is generating huge amounts of data every second. The vast majority of that data is digital exhaust. It goes nowhere. … Most of the data is lost when the power is turned off at the end of the day. And so what I see is an industry — just one of many industries — that has so much opportunity to derive value from this moment of digital transformation.”
APiJET debuted its Smart Aircraft system last year with IcelandAir as its first customer. Other customers include Alaska Airlines, which is using APiJET’s technology to roll out NASA’s Traffic Aware Strategic Aircrew Requests technology.
But how in the world did Gibbons and Elop reunite? As it turns out, this is just the latest connection between them.
They first worked together a decade ago at Microsoft, when Elop led the Office group as president of the Microsoft Business Division, in his first stint at the company. Gibbons, a veteran of Microsoft’s Xbox, Mac and hardware teams, was a leader in the company’s mobile phone business at the time, overseeing its work with device makers. Then, five years ago, they worked together more closely when Gibbons was tapped to lead the integration of Nokia’s mobile phone business into Microsoft following the completion of the $7 billion acquisition.
But they also have another connection: both Gibbons and Elop are pilots, and they would often see each other as part of Seattle’s tight-knit aviation community.
They both left Microsoft separately in 2015, and reconnected again when Gibbons, a trustee at Seattle’s Museum of Flight, gave Elop a tour of the museum. That led to Elop becoming a museum trustee, as well. In addition, when Elop learned that Gibbons was working on a new project for industry legend Joe Clark at Aviation Partners, the pioneer in fuel-saving blended winglet technology, Elop was intrigued enough to ask Gibbons to meet up so he could learn more.
Gibbons was previously APiJET’s interim CEO while also working at Aviation Partners on new ventures, and was finding himself spread too thin. So when Elop asked how he could help, Gibbons said he jumped at the chance to hand the controls to his former colleague.
“If Kawhi Leonard offers to join your team, you don’t say no,” Gibbons said, likening Elop’s arrival to the NBA MVP joining former Microsoft CEO Steve Ballmer’s L.A. Clippers this season in a blockbuster trade. With Elop on board, Gibbons shifted to a position as chief operating officer of APIJET, in addition to his Aviation Partners role.
Many longtime Nokia fans and employees still associate Elop with the iconic company’s decline, and the ultimate fall of its smartphone business. So we asked him, what lessons did he learn from Nokia that he brings to this new venture?
First, Elop said he considered Microsoft’s Nokia integration work as good as he’s ever seen in his career, “in terms of insights, decision-making, treating people respectfully,” and bringing teams together under unified leadership.
“A lot of really good work was done,” Elop said, calling it “very disappointing to the people involved” when Microsoft’s board decided to back out of the smartphone hardware business and take a $7.6 billion writedown on the Nokia smartphone acquisition after Ballmer’s departure, cutting thousands of jobs in the process.
That decision was part of an effort by CEO Satya Nadella to refocus the company on its core strengths, an approach that has contributed to Microsoft’s resurgence.
As for lessons learned, Elop said the Nokia experience taught him that “one can never be complacent.” He explained, “You may be the leader in the industry, but you’ve got to be listening, you’ve got to be ahead of it, and you’ve got to be constantly disrupting yourselves, lest someone else disrupt you.”