Microsoft's CEO Satya Nadella has acknowledged the company wasn't responsive enough when it came to developing mobile phone technologies and that's why it failed to succeed.
Nadella said the company wasn't proactive enough when rivals including Apple and Google were developing their devices.
"We clearly missed the mobile phone, there's no question," Nadella said. "Our goal now is to make sure we grow new categories. The lesson learned for us, was thinking of PC as the hub for all things for all time to come. It was perhaps one of the bigger mistakes we made."
Although Windows 10 Mobile continues to be available for Microsoft fans, no new phones will be developed by Microsoft using the platform.
However, there are rumours that the company could soon be launching a smaller Surface tablet that would cross the boundaries between a tablet and a smartphone, although whether it's going to be more along the lines of a phablet or a smartphone remains to be seen.
Microsoft has instead emphasised its focus in the future will be on virtual reality devices, such as the company's Hololens, which is set to go head to head with the Oculus Rift and HTC Vive.
Nadella said he views the Hololens as the beginning of the 'ultimate computer,' giving people the opportunity to break away from the confines of their equipment into a world that is much bigger and more exciting.
