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03/09/2013

Microsoft buys out Nokia for $7.2B; What this means to Android

In an unexpected series of events, Software Giant Microsoft announced the acquirement of Nokia’s Devices and Services Business, Nokia’s mapping services and patents Nokia currently holds. We had heard rumors of Microsoft being in talks with Nokia for an acquirement quite a long time back and it comes out that this rumor did hold some substance as Nokia has confirmed that Microsoft approached Nokia with the deal in February this year.

Nokia’s share rose about 40 pc, a record growth for a single day, after the news broke out. It looks like Microsoft has been able to net a good deal with Nokia as Google had to pay Motorola ,another mobile giant, $12 billion for its acquirement.

Nokia Timeline:

  • Founded in 1871 and named after a Finnish river called Nokianvirta, Nokia spent over a century manufacturing cables, boots and tyres. It was only in 1992 that Nokia sold off its non-mobile subsidiaries.
  • Nokia’s first phone called Mobira Cityman was launched in 1987. It weighed a hefty 800 grams and costed an even heftier 4,650 Euros.
  • Nokia 1100 sold over 250 million units,making it the most popular consumer electronics device ever!
  • Nokia remained #1 Mobile Vendor before Samsung toppled it in 2012.
  • Nokia currently isn’t at its best in terms of the mobiles and smartphones it sells, holding a mere 15% and 3% share in both these categories.
  • Nokia gets acquired by Microsoft for $7.2 Billion in September 2013.

What this means to Android:

This was the first thought that came to my mind when I heard about this news. With Microsoft investing heavily in Nokia, it \has made clear that it isn’t taking its Windows Phone business lightly and plans to give iOS and Android some good competition in the future. As was speculated in the case of Google’s acquirement of Motorola (though it didn’t actually occurred), Microsoft might work in close partnership with Nokia to optimize its Windows operating system on the smartphones Nokia will produce in the future.

Many, including me, were hoping that when Nokia’s earlier deal with Microsoft (to manufacture only Windows Phone based smartphones) will get over, we might see a Nokia device running the Android OS some day. This deal puts rest to any such imaginations of ours and we shall continue encountering more and more Lumias from Nokia in the future.

Microsft might also be planning to use Nokia’s mapping resources in Bing Maps to give some competition to Google, Apple and others in the Mapping market.

I would be interested to learn what our readers think about this deal.
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