Shock news of the morning is that Microsoft is buying the devices and services division of Nokia, and licensing the Finnish company’s extensive patent arsenal for around $7.2-billion. The acquisition will see Microsoft take over the entire range of Nokia phones including both the Lumia smartphones that run its Windows Phone OS as well as the Nokia Asha series of low-cost, pseudo-smart feature phones that Nokia sells in emerging markets. According to press releases from both of the companies, 32 000 employees will transfer from Nokia to Microsoft.
The patent deal will also see Microsoft get a 10-year, non-exclusive license to Nokia’s massive portfolio of patents. Nokia will receive “reciprocal rights” to Microsoft’s mapping patents for its HERE mapping services. The Redmond, Washington-based company will pay Espoo, Finland based Nokia €3.79-billion ($4.99-billion) for the devices business and another €1.65-billion ($2.18-billion) for the patents. Nokia will continue to own the ‘Nokia’ name but Microsoft will be able to use it for devices it releases.
The move comes at an interesting time, particularly as Microsoft looks for a new CEO after the announcement of Steve Ballmer’s departure. Elop was hired by Nokia in 2010, from Microsoft no less, and was often seen as a potential inroad should Microsoft ever want to get into the hardware business. He has been one of the favourites to take over as CEO when Ballmer stepped down, and has resigned as Nokia CEO to become the Executive Vice President of Devices and Services, at Microsoft. In the interim, Nokia chairman Risto Siilasmaa takes over the top spot to avoid possible conflicts of interest in the deal.
The full presentation given by Microsoft to the media is included below (thanks to AllThingsD for that).
Source: Engadget
