Microsoft and Nokia to discuss sale of Nokia’s mobile unit next week?
Do you know what could easily overshadow the $8.5 billion acquisition of Skype by Microsoft? How about a multi-billion acquisition of none other than the biggest phone maker in the world – Nokia? If we are to believe Russian tech analyst Eldar Murtazin’s inside information, that’s exactly what’s about to happen as talks about the sale of Nokia's mobile unit are to be held next week between the two tech behemoths. What’s more – both Redmond and Espoo are reportedly in a hurry and the deal could close as soon as the end of 2011. For the time being, however, Murtazin notes, everything will remain behind closed doors. As unbelievable as it would have been mere months ago, the deal sounds close to reality after Nokia and Microsoft signed the Windows Phone agreement.
If true, the deal will change not only Nokia, but the mobile landscape from the ground up. It’s still a rumor, but it seems credible as Murtazin is the exact same analyst whoe correctly predicted that Nokia will ditch its Ovi branding two weeks ahead of the event. Currently, Nokia’s market value hovers around the $33 billion mark and it’s the company’s main mobile unit that could be sold. How would this change the mobile industry? Feel free to share your opinions in the comments below!
source: MrMurtazin (translated)
1. ryq (unregistered)
Nokia down fall continue.
6. Henrik (unregistered)
And Microsoft's uprise/advancements continues with an even heavier accelerating speed. The boys at Google and Apple must be scratching their heads right now, flickering through stacks of business cards looking for someone/something to buy in a counter-action.
9. Soulmanager11 (Posts: 26; Member since: 04 May 2011)
If the rumors are true, the psycos at Redmond are the ones showing desperation, overpaying for all this companies.
11. Henrik (unregistered)
Shortcuts = Desperation? To some extent, yes. But Microsoft is doing Exactly what it needs to do, since they have nothing to win by idle standing by in hopes of their competitors to do the same. And they got cash to spare, so why not use it on something good.
You know, they weren't just buying the patented technology behind Skype, or it's recognizable brand name, they were buying its 110 million user base. It's Much easier and cheaper to Keep existing customers than trying to attract new ones. Any sane company knows that. So instead of trying to fish for 110 million users itself, Microsoft simply bought someone who already had it in their pockets.
Microsoft are no psychos, they are simply just investing aggressively to: (1) Stay competitive and not fall behind. (2) Not loose existing customers. (3) Not letting competitors grab a hold of key companies in the mobile business (4) Gain market share(s) while fulfilling 1-3.
Kids in the comments crying about "M$" being "evil" should stick to something they know better, like playing mobile games with friends on the lunch breaks in school. What we are witnessing is a multi-billion dollar business with long-term evaluations, not some kindergarten lunch box fight. Google does the exact same things, buying more and more technology companies in order to hopefully someday have monopoly and also not letting Apple (soon Microsoft) get them first.
The whole spectacle about Google boasting in from below buying AdMob for over the asking price while Apple was still in the talks with them is just a perfect example of what is going on. All these companies knows how valuable the mobile business is - and will remain - so they all buy stuff left right and center just to stay afloat and be on pair or ahead of competition.
Microsoft got huuuges opportunities that Google (and Apple) don't have, considering the large user base of Windows OS (Mac OSX really got nothing on it), and now they have decided to not wait and see what happens anymore. They have done that for a couple of years already, and their investors are getting worried. Microsoft, just as Google and Apple, have big stacks of pure cash piled up and what we're seeing now is those stacks of cash in movement.
I personally don't like Microsoft buying Nokia's mobile unit, seeing as I live in Sweden and Nokia is our neighbor and the last real European phone manufacturer. But I would guess that Microsoft (and Nokia) got a better insight into what's going on behind the curtains of the business than what we consumers have ...
2. Vulcan (unregistered)
Eldar? Analyst? He is a Russian blogger who is "sponsored by Samsung", the main competitor of Nokia. He has about 50% right/wrong track record and has been spreading false claims as often as almost truthfull claims.
3. Bob (unregistered)
Its a good thing Nokia didn't altogether shut down. I was wondering if MS could have purchased Nokia first and then transitioned to WinMo7 .. could this have saved MS some money OR was it protocol ? The sale of Nokia to a big buyer like Microsoft seems almost correct & thereby certain in today's times - afterall recession still hasn't left the gates by a long margin.
4. calamazoo (unregistered)
@vulcan - name one thing that didn't turn out true about nokia or samsung from eldar in the last year or so.
with that said, why would microsoft bother spending, it already took over nokia from within, it's afraid the board might oust Elop and go with Android? that's silly... like giving $8.5 billion for Skype.
5. remixfa (Posts: 14059; Member since: 19 Dec 2008)
they would buy them only if they found potential extra profits in doing the manufacturing themselves. If they could make an extra 20% per handset sold then it might be worth it.
Of course, instead of a full buy out, this could also just be taking partial ownership like MS has of Apple so they get profit sharing as Nokia recovers.
7. calamazoo (unregistered)
remixfa is precisely right, it's probably a share swap thingy
8. TreyTreyTaylor (Posts: 312; Member since: 21 Dec 2010)
I officially don't give a crap about what Nokia does anymore. From now on every time PA posts something ill just say good luck with that.
12. bluechrism (unregistered)
This one is a bit too far out there for me and I don't think this will happen. First off, it makes no sense anyway. Nokia has 3 main devisions - Smartphones, Mobile Phones and Nokia-Siemens Networks. Buying the mobile phone devision is the S40 feature phones. Secondly, this deal has only just happened and i think if there were ever future deals with Nokia / MS it would be after some time of Nokia selling Windows Phone successfully.
3rd - Nokia want to stay separate to MS.
Lastly, I think MS is happy selling phones to multiple handset makers and if they start making handsets as well they would become a closed shop by default.
Eldar has had some things right, but also spouts some bs and i think this falls into the latter category. It's not impossible, but highly unlikely.
13. jthiagesan (Posts: 104; Member since: 20 Apr 2011)
Nokia meant for it's designs, user friendly and durability. If this happens i'll never look back to Nokia.
15. bluechrism (unregistered)
FYi - Nokia have said this rumour is way off. Most other tech blogs have updated the story.
Mark Squires, Coms Director at Nokia:
“We typically don’t comment on rumors. But we have to say that Eldar’s rumors are getting obviously less accurate with every passing moment.”
16. darkurious (Posts: 10; Member since: 07 Dec 2010)
17. javachris (Posts: 5; Member since: 13 Dec 2010)
I believe that this move would be a win-win situation for both companies. I think that Murtazin meant that only the smartphone division will be sold to MS. Selling the S40 and lower end division would not be a smart move. My reasoning? First of all, it's clear as daylight that Nokia cannot come out with competitive smartphones, even though they do make the best smartphone hardware available today, the software on them is behind Android and iOS. Selling the smartphone division to MS would result in phones with great hardware and pretty good software. IMHO Windows Phone will peak on next year's summer and will kick ass. Selling the S40 and lower end division would mean disaster because MS does not have the knowledge to keep it floating.
18. uswah (unregistered)
nice article has been shared