After almost eight months, Microsoft’s acquisition of Nokia’s handset business is finally a done deal.
As part of the $7.2 billion acquisition, Microsoft is buying Nokia’s smartphone and mobile phone businesses, its design team, most of its manufacturing and assembly facilities and operations, and sales and marketing support.
”The opportunity for Microsoft to be both a devices and services company, so that it can deliver the complete proposition to its consumers, is at the heart of this,” said Stephen Elop, former Nokia CEO and now executive vice president of the Devices Group at Microsoft (seen above taking a leisurely stroll with new Microsoft CEO Satya Nadella).
Microsoft and Nokia have been working closely together since 2011, when they surprised the tech crowd ahead of that year’s Mobile World Congressby announcing a dealthat would see Nokia focus largely on Windows Phone-based devices. Microsoft’s mobile OS has made gains since then – and Nokia has produced some well-received Lumia devices (below) – but it still has a ways to go in order to catch up to Android or iOS. Redmond is hoping this tie-up will accelerate that growth.
”The real value from this integration is bringing two globally sized capabilities in organizations together under one roof, really intimately and much more efficiently,” said Tom Gibbons, the Microsoft corporate vice president who is responsible for the Nokia integration.
Microsoft will also take on Nokia’s feature phones, which ”will start to have more of the Microsoft services shipped on those phones right out of the gate,” Gibbons said.
Elop acknowledged that the decline of PCs, as well as price issues, mean that ”the vast majority of people do not have, nor will they ever have a personal computer.”
”And yet through the mobile phone business we have an opportunity to introduce what we like to call the next billion people, the next billion people to connect to the Internet, to Microsoft, because they’ll have an opportunity perhaps to have a first Skype experience, or a first experience with Bing, as an example. And so there are literally billions of people who can be exposed to Microsoft for the very first time,” he said.
Redmondannounced plans last yearto acquire Nokia’s devices and services business in September for €3.79 billion ($5.2 billion). The tech giant will also shell out another €1.65 billion ($2.18 billion) to license Nokia’s patents for a grand total of €5.44 billion (about $7.2 billion) in cash.
The deal was initially set to close at the end of the first quarter (March 31), butwas delayedas the companies awaited approval from the ”final markets” in Asia. Chinese authorities thengave the thumbs upafter Redmond reiterated its commitment to licensing standards-essential patents.