Microsoft buying Nokia Devices and Services

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Here's an interesting consequence. The deal only precludes Nokia from releasing phones under the Nokia brand until 1/1/16, as it is worded it leaves them open to release a non-Nokia branded phone before then because the terms of the 10 year patent licence doesn't preclude internal use at all.

I'm really surprised that MS didn't shut this avenue down. The new board could decide to buy a smartphone startup and sell the phones under the name of the startup until 31/12/15 and rebrand to Nokia thereafter. I don't see it as a likely scenario, but the possibility has been left open. Stupidly IMO, by MS. It feels like MS were desperate to get a deal done and agreed to pretty much anything to ensure it happened, including not having the Nokia brand for smartphones, leaving the door open for Nokia's return, and not actually buying any patents related to the difference but paying €1.7bn for a 10 year licence.
 
I don't know what to think of this. I love my Lumias and what Nokia were doing with it with their HERE stuff, their other software and hardware. Somehow I have doubts in Microsoft's competency.
Nokia is the only reason WP stayed afloat. They were often hindered by MS who is just too slow to implement features.
Hopefully they head towards the direction of Nokia with regards to software and hardware instead of fucking up a good thing.
I just hope this really leads to more unified devices and WP maturing faster.
 
Ballmer's letter to Microsoft staff
We announced some exciting news today: We have entered into an agreement to purchase Nokia’s Devices & Services business, which includes their smartphone and mobile phone businesses, their award-winning design team, manufacturing and assembly facilities around the world, and teams devoted to operations, sales, marketing and support.

For Microsoft, this is a bold step into the future and the next big phase of the transformation we announced on 11 July.

Stephen Elop will be coming back to Microsoft, and he will lead an expanded Devices team

We are very excited about the proposal to bring the best mobile device efforts of Microsoft and Nokia together. Our Windows Phone partnership over the past two and half years has yielded incredible work - the stunning Lumia 1020 is a great example. Our partnership has also yielded incredible growth. In fact, Nokia Windows Phones are the fastest-growing phones in the smartphone market.

Now is the time to build on this momentum and accelerate our share and profits in phones. Clearly, greater success with phones will strengthen the overall opportunity for us and our partners to deliver on our strategy to create a family of devices and services for individuals and businesses that empower people around the globe at home, at work and on the go, for the activities they value most.

We have laid out Microsoft’s strategic rationale for this transaction in a presentation that I encourage you to read.

This is a smart acquisition for Microsoft, and a good deal for both companies. We are receiving incredible talent, technology and IP. We’ve all seen the amazing work that Nokia and Microsoft have done together.

Given our long partnership with Nokia and the many key Nokia leaders that are joining Microsoft, we expect a smooth transition and great execution.

As is always the case with an acquisition, the first priority is to keep driving through close, which we expect in the first quarter of 2014, following approval by Nokia’s shareholders, regulatory approvals, and other closing conditions.

But I also know people will have some questions about what happens post-close. While details aren’t final, here is what we know, and how we’re generally approaching integration:

1. Stephen Elop will be coming back to Microsoft, and he will lead an expanded Devices team, which includes all of our current Devices and Studios work and most of the teams coming over from Nokia, reporting to me.

2. Julie Larson-Green will continue to run the Devices and Studios team, and will be focused on the big launches this fall including Xbox One and our Surface enhancements. Julie will be joining Stephen’s team once the acquisition closes, and will work with him to shape the new organisation.

3. As part of the acquisition, a number of key engineering leaders will be joining Microsoft from Nokia, reporting to Stephen in his new capacity:
· Jo Harlow, who will continue to lead the Smart Devices team
· Timo Toikkanen, who will continue to lead the Mobile Phones team
· Stefan Pannenbecker, who will lead Design
· Juha Putkiranta, who will lead the integration effort on Nokia’s behalf

4. Regarding the sales team, we plan to keep the Nokia field team, led by Chris Weber, intact and as the nexus of the devices sales effort, so that we can continue to build sales momentum. After the deal closes, Chris and his team will be placed under Kevin Turner. We will develop a single integrated team that is selling to operators, and there may be other integration opportunities that we can pursue. Kevin will work with Chris Weber and Chris Capossela to make those plans.

5. Our operating system team under Terry Myerson will continue unchanged, with a mission of supporting both first-party and third-party hardware innovation. We are committed to working with partners, helping them build great products and great businesses on our platform, and we believe this deal will increase our partner value proposition over time. The established rhythms and ways of working between Terry and his team and the incoming Nokia team will serve us well to ensure that we do not disrupt our building momentum.

6. We are planning to integrate all global marketing under Tami Reller and Mark Penn. It is very important that we pursue a unified brand and advertising strategy as soon as possible.

7. Finance, Legal, HR, Communications, DX/Evangelism, Customer Care and Business Development will integrate functionally at Microsoft.

Sourcing, customer logistics and supply chain will be part of Stephen’s Devices organisation. ICM/IT will also integrate functionally for traditional IT roles. We will need to work through the implications for factory systems given the differing manufacturing processes and systems at both Nokia and Microsoft.

8. We plan to pursue a single set of supporting services for our devices, and we will figure out how to combine the great Nokia efforts into our Microsoft services as we go through the integration process.

9. There are no significant plans to shift where work is done in the world as we integrate, so we expect the Nokia teams to stay largely in place, geographically.

10. Tom Gibbons will lead the integration work for Microsoft.

While today’s announcement is big news, we have to stay heavily focused on running the current business. We have a huge fall and holiday season ahead of us, so we need to execute flawlessly and continue to drive our business forward. I have no doubt we will.

Steve
Click to expand...
 
Then Nokia is dead.

Only promise it had would be nokia phones with Android. But with Windows Phone (that no one wants and care about) Nokia phones won't ever have market share to compete with Android overlord.
 
SHIT… there’s goes the possibility of buying Nokia phones in the future as far as I’m concerned.

It’s not that I dislike Nokia or think they’re incapable of making decent stuff, it’s just that I want to distance myself from MS’s ecosystem as much as possible after seeing the type of shit they’re scheming on Windows 8 and xbox180. After enjoying the full open flexibility of android, I can’t see myself going to anything less. Staying with open platforms is the best bet I have to be immune against shit I don’t want. There’s no way MS can ever sucker me in. Sigh…RIP Nokia.
 
Perkel said:
Then Nokia is dead.

Only promise it had would be nokia phones with Android. But with Windows Phone (that no one wants and care about) Nokia phones won't ever have market share to compete with Android overlord.
Click to expand...
Nokia will continue to operate, just without its mobile division.
 
GCX said:
Nokia will continue to operate, just without its mobile division.
Click to expand...

Yeah, they can still continue making tires!

Why didn't Nokia ever make a phone out of the tire material? Wouldn't that be the most unbreakable phone ever as the material would just absorb the fall impact, and you'd be able to grip the phone better.
 
Hmm, someone here just said that some shareholders may not approve of the sale and take it to court because they feel that Elop has purposefully destroyed value in Nokia's smartphone business allowing MS to buy it cheaper than it should be.

Interesting times...
 
Atruvius said:
Yeah, they can still continue making tires!

Why didn't Nokia ever make a phone out of the tire material? Wouldn't that be the most unbreakable phone ever as the material would just absorb the fall impact, and you'd be able to grip the phone better.
Click to expand...

Nokia tires is a completely separate company.

Nokia still continues to operate with HERE maps, Nokia Solutions and Networks and Advanced Technologies. You know the profitable part of Nokia's business. Phone business made over $700 million operating loss last year.

zomgbbqftw said:
Hmm, someone here just said that some shareholders may not approve of the sale and take it to court because they feel that Elop has purposefully destroyed value in Nokia's smartphone business allowing MS to buy it cheaper than it should be.

Interesting times...
Click to expand...

This must be the definition of delusional. Nokia became a failure with choices made way before Elop.
 
Atruvius said:
Yeah, they can still continue making tires!

Why didn't Nokia ever make a phone out of the tire material? Wouldn't that be the most unbreakable phone ever as the material would just absorb the fall impact, and you'd be able to grip the phone better.
Click to expand...


And it would give new meaning to the phrase, "I'm retiring this phone".
 
Lagspike_exe said:
This is a stupid decision from MSFT. They keep sinking money into a project that has no future.
Click to expand...

This is a brilliant move and one they should have done ages ago but I'm sure they were waiting for Nokia to sink a lot so it would be feasible. This is the best way for them to keep up a winning chance to get into the Post-PC era.
 
zomgbbqftw said:
Hmm, someone here just said that some shareholders may not approve of the sale and take it to court because they feel that Elop has purposefully destroyed value in Nokia's smartphone business allowing MS to buy it cheaper than it should be.

Interesting times...
Click to expand...

having followed Nokia downfall, I think Elop could be criminally charged for destroying Nokia in the first place and then selling it off for peanuts.

I can not believe something like this can happen in 22nd century, it is unbelievable.
 
spwolf said:
having followed Nokia downfall, I think Elop could be criminally charged for destroying Nokia in the first place and then selling it off for peanuts.
Click to expand...
Apple destroyed Nokia 'in the first place'. At most you could possibly argue that Elop deliberately contributed to the decline. But killing them in the first place? That was the iPhone.

spwolf said:
I can not believe something like this can happen in 22nd century, it is unbelievable.
Click to expand...
I know I had a long night's sleep last night but, 22nd century?
 
spwolf said:
having followed Nokia downfall, I think Elop could be criminally charged for destroying Nokia in the first place and then selling it off for peanuts.

I can not believe something like this can happen in 22nd century, it is unbelievable.
Click to expand...

I imagine there would have to be something written or a witness to have success in a lawsuit. I bet there have been some emails/memos/letters destroyed.
 
Lagspike_exe said:
This is a stupid decision from MSFT. They keep sinking money into a project that has no future.
Click to expand...

First, I'm a not a ms fan by any means. Actually, I down right hate the company and their crappy products. However, if I've learned anything from how they handled their first entry into the console gaming side is that they are willing to do (ie spend) whatever it takes to gain a foot hold, and eventually dominate, an area they feel is necessary for their continued success.
 
They bought the largest part of the company:

i83STdeDpofwu.png
Click to expand...

Smart devices = smart phones & tablets
Mobile phones = dumb phones

Note 5 relating to operational and reporting structure: We adopted our current operational structure during 2011 and have three
businesses: Devices & Services, Location & Commerce and Nokia Siemens Networks and four operating and reportable segments: Smart
Devices and Mobile Phones within Devices & Services, Location & Commerce and Nokia Siemens Networks. Smart Devices focuses on
smartphones and Mobile Phones focuses on mass market mobile devices, including Asha full touch smartphones. Devices & Services also
contains Devices & Services Other which includes net sales of our luxury phone business Vertu through October 12, 2012, spare parts and
related cost of sales and operating expenses, as well as intellectual property related income and common research and development
expenses. In October 2012, we completed the divestment of Vertu to EQT VI, a European private equity firm. Location & Commerce focuses on
the development of location-based services and local commerce. On November 13, 2012, Nokia introduced HERE, the new brand for its
location and mapping service. For financial reporting purposes, the Location & Commerce business will be renamed as the HERE business,
starting with the first quarter 2013. Nokia Siemens Networks is one of the leading global providers of telecommunications infrastructure
hardware, software and services. Nokia Siemens Networks completed the acquisition of Motorola Solutions’ networks assets on April 30, 2011.
Accordingly, the results of Nokia Siemens Networks for 2012 are not directly comparable to 2011.
Click to expand...
 
A bit of misreporting up there.

There's a 10 year deal for the Nokia branded devices. While Asha and Lumia are now Microsoft's brands, they will be allowed to use the Nokia name for Lumia/Asha devices for 10 years. Not just featurephones.

I still feel as though this is a great move for the world market. And I still feel that they need maybe one premium partner (Blackberry) and they would really be able to carve out some marketshare and effectively stop any other prospective entrant into the market. Nokia's weakness is its ability to grab attention in the US market, though I would go as far to say that it's been better in the last year thanks to Microsoft's ads and having almost all networks carry its devices.
 
Guys, MS HAS to keep pumping money into mobile to keep it as a viable option. Mobile computing is linked directly to their core business.

You can make an argument the Xbox is not core business. Not so for mobile.

As for Nokia, the question is why didn't they sell Nokia to MS from the get go; why did they hire a MS guy as a CEO to make all the sweet software deals with MS before selling the hardware division to MS for cheap?

I have always thought the downfall of Nokia was the Nokia board's fault, not Elop's fault.
 
zomgbbqftw said:
Here's an interesting consequence. The deal only precludes Nokia from releasing phones under the Nokia brand until 1/1/16, as it is worded it leaves them open to release a non-Nokia branded phone before then because the terms of the 10 year patent licence doesn't preclude internal use at all.
Click to expand...
Would a Nokia divested of its unprofitable smartphone arm (so, basically, Nokia Siemens Networks) want to do this though? Especially one without a platform business to push. I could see some interest in the dumbphone space but presumably MS has the name in that case for the full ten years, right?
 
Penguins&PolarBears said:
So is Nokia still going to release a Windows tablet to compete with Surface this fall?

Sirius vs. Surface?
Click to expand...

tat's not ouf of the question as both products are probably too far ahead in the pipeline to be aborted.

having a last batch of RT tablets would help MS maintain the decision to support RT for some years, when in reality they'll move away from it and build a two product lines strategy in the future with a Surface line sporting Windows, and the Lumia line sporting a revise for tablet Windows Phone.

they might eventually gap that bridge in the further future with 1 OS, built on the fundations of the regular Windows OS but with Here competently integrated, and maybe x86 chips having gained enough traction in the mobile space to be competitve against arm.

MS is building itself against Goolge/Apple.
it's not out of the question that apart from diferrantied maketplaces, these companies would try and rely on differentiated architectures to fight each others.

Coding is still evolving, I suppose it's not ouf the question that a cloud based computing world would alleviate the problems devs would face having to code for substantially different hardwares.

they code for the cloud, and each company then implements a software/hardware solution so that third party services reach consummers hands, as effectively as possible.
 
markot said:
banditnokia1520leakev.jpg

http://www.engadget.com/2013/09/03/claimed-nokia-bandit-screen-grab-stokes-imminent-giant-lumia-1/

god
Click to expand...

it's windows phone...
you can already clutter it to death. or keep it ultra simple.

what is good, is MS just needs to add vertical/horizontal, et voila! RT not needed.
they "simply" need to work harder on their hubs so that settings access and launching applications doesn't take too much delving rather than reroute as much stuff to Windows charms.

add a few gesture based controls here and there and that should not take 3 years.
 
zomgbbqftw said:
Here's an interesting consequence. The deal only precludes Nokia from releasing phones under the Nokia brand until 1/1/16, as it is worded it leaves them open to release a non-Nokia branded phone before then because the terms of the 10 year patent licence doesn't preclude internal use at all.

I'm really surprised that MS didn't shut this avenue down. The new board could decide to buy a smartphone startup and sell the phones under the name of the startup until 31/12/15 and rebrand to Nokia thereafter. I don't see it as a likely scenario, but the possibility has been left open. Stupidly IMO, by MS. It feels like MS were desperate to get a deal done and agreed to pretty much anything to ensure it happened, including not having the Nokia brand for smartphones, leaving the door open for Nokia's return, and not actually buying any patents related to the difference but paying €1.7bn for a 10 year licence.
Click to expand...

also they are allowed to use the Nokia name with asha phones for 10 years (I guess they recognise the strong brand association in the lower end of the market)

so you could be in a situation where 'new' Nokia releases a Nokia branded smartphone in 2016, into a market with MS Nokia branded asha devices. Same brand, two companies. Odd.
 
The difference between this thread and the one on the gaming side is staggering.

I hadn't realized Elop was a MS employee before his stint at Nokia, but it's the height of delusion to think the company was going to be a leader in the smartphone biz from 2010 onwards.
 
mrklaw said:
also they are allowed to use the Nokia name with asha phones for 10 years (I guess they recognise the strong brand association in the lower end of the market)

so you could be in a situation where 'new' Nokia releases a Nokia branded smartphone in 2016, into a market with MS Nokia branded asha devices. Same brand, two companies. Odd.
Click to expand...
This has happened before. If I have it right, Volvo trucks and Volvo cars are owned by different parents.

I don't see why Nokia would want to get back into smartphones though. Why? Have they been successful?
 
CurlySaysX said:
so ms can't even use the Nokia name? lol
I'm calling it, Nokia to buy Jolla and release phones using android and meego.
Click to expand...
Nokia just got rid of the mobile division that made them gigantic losses.

Why on earth would they want to get back to that same business when they make $1 billion annual profit with their network and mapping divisions? I think they'll use Microsoft's $7 billion check elsewhere.
 
The Abominable Snowman said:
A bit of misreporting up there.

There's a 10 year deal for the Nokia branded devices. While Asha and Lumia are now Microsoft's brands, they will be allowed to use the Nokia name for Lumia/Asha devices for 10 years. Not just featurephones.

I still feel as though this is a great move for the world market. And I still feel that they need maybe one premium partner (Blackberry) and they would really be able to carve out some marketshare and effectively stop any other prospective entrant into the market. Nokia's weakness is its ability to grab attention in the US market, though I would go as far to say that it's been better in the last year thanks to Microsoft's ads and having almost all networks carry its devices.
Click to expand...

No, it says in the Nokia PR that Microsoft will only be able to use the Nokia branding for "Mobile Phones" which is feature phones and possibly Asha phones. Nokia class Lumia under "Smart Devices" which is not covered by the 10 year brand licence deal.

Yoshiya said:
Would a Nokia divested of its unprofitable smartphone arm (so, basically, Nokia Siemens Networks) want to do this though? Especially one without a platform business to push. I could see some interest in the dumbphone space but presumably MS has the name in that case for the full ten years, right?
Click to expand...

I'm not suggesting they will, I am pointing out that it is naive of Microsoft to not close that door behind them ans throw away the key. With the brand restrictions on Nokia expiring on 1/1/16 it leaves the door open for their return far too soon.
 
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