So the deal that should have been done 2 years ago is at last completed: Microsoft MSFT is buying most of Nokia to take control of its smartphone destiny.
It is strong in the “feature phone” business in the developing world, it has struggled in the all-important smartphone business. Apple’s iPhone and handsets running Google’s Android together make up over 95% of sales in the US and China, the world’s two largest smartphone markets,according to Kantar Worldpanel’s latest figures. Windows Phone only has shares above 10% in Mexico and France, according to the company’s figures.
Microsoft hopes that allying with its biggest Windows Phone manufacturer will speed up growth (and improve its smartphone market share) — the company is already promising “increased synergies”. CEO Steve Ballmer added: “It’s a bold step into the future – a win-win for employees, shareholders and consumers of both companies. Bringing these great teams together will accelerate Microsoft’s share and profits in phones, and strengthen the overall opportunities for both Microsoft and our partners across our entire family of devices and services.”
According to the companies’ press releases, 32,000 people will transfer across Microsoft, including 4,700 people in Finland and 18,300 employees directly involved in product manufacture. If you thought it was only the Windows Phone component of the phone business, you’d be wrong: Microsoft will also take into ownership Nokia’s Asha range of feature phones. Patent-wise, Microsoft gets 10-year non-exclusive license to its Finnish partner’s library of ideas and “reciprocal rights” to use Microsoft patents within its HERE mapping services. While Microsoft will be able to use the Nokia branding on its products, the Finnish company will now focus on its mapping, infrastructure and advanced tech arms.
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