Microsoft Corp. was recently in advanced discussions with Nokia Corp. about a purchase of the Finnish company’s device business, according to people familiar with the matter, in a marriage that could have reshaped the mobile-phone industry.
The talks have faltered, they said. One person said talks took place as recently as this month but aren’t likely to be revived.
The two sides made significant progress on a plan that would stitch the U.S. software giant with a mobile-phone pioneer. Both companies have struggled of late, as each has tried to adapt to a world in which consumers prefer smartphones built by Apple Inc. and Samsung Electronics Co.
I doubt this merger would have any significant impact on Apple or Samsung. It may help Nokia and Microsoft shake things up, but there’s already a lot at stake in the mobile market, so if they aren’t working closely already there’s little chance they ever will.
Elop, hired in 2010 from Microsoft Corp to turn around the Finnish mobile phone maker, earned 4.33 million euros ($5.63 million) in 2012, down from 7.94 million euros in 2011.
While his base salary rose by 59,500 euros to 1.08 million euros, his stock and option awards fell slightly and he earned no bonus, according to the Thursday filing with the U.S. Securities and Exchange Commission.
I felt bad for him until I saw the numbers. How much money do you deserve for running a company into the ground?
“I think you’re going to see a trend where operators, starting in the West, begin to say, ‘We need a third ecosystem to really begin to happen. We really need to double down on it. We need to cause it to happen.’”
The the company’s strategy is to wait until carriers are tired of selling millions of iPhones and Android devices and force Nokia products on us. Yeah, that’ll work.
“We have not announced any tablets, but I think the opportunity is very clear,” Nokia CEO Stephen Elop told ABC News. “People today increasingly are looking for a common digital experience between their smartphone and tablet, with a PC, and with their gaming platform, and so there’s clearly an opportunity across there. This is something that we’re looking at very closely.”
Not a huge surprise, really. Maybe a bigger surprise that it’s not more of a priority.
Instead, I was left with a key unanswered question from Nokia that directly impacts the company’s future: What did it announce today that will get consumers to switch from an iPhone or Android device? Without a compelling answer to that question, I suspect most new Lumia sales will come from those already using an older Lumia and that won’t generate the growth that Nokia needs to sustain a turnaround.
Smart article by Kevin. To my mind, this is the key point that Nokia may have missed. You have to give consumers a reason to switch and if they didn’t do that, they missed a huge opportunity. With the new iPhone coming soon, it’s hard to imagine that people will go for a Lumina.
Over the past five quarters, the onetime darling of mobile telecoms has eroded its cash pile by 2.1 billion euros ($2.7 billion) – a rate that would wipe out its entire 4.9 billion euros reserves in a couple years.
The complaint alleges that during the Class Period, defendants told investors that Nokia’s conversion to a Windows platform would halt its deteriorating position in the smartphone market. It did not,” the lawsuit states. “This became apparent on April 11, 2012, when Nokia disclosed that its first quarter performance would be worse than expected. Nokia expected its first quarter 2012 non-IFRS Devices & Services operating margin to fall by 3%, and projected first quarter 2012 Devices & Services net sales of €4.2 billion.
It’s a good thing RIM owners never thought of this.
The Finnish handset maker had previously told investors it expected to break even on device sales during the quarter, but its operating margins proved to be around negative 3 percent. Nokia now expects its second quarter of 2012 to be similar to or below the first quarter.
Market research firm IDC reported this week that Apple has surpassed LG Electronics to become the third largest mobile phone maker, behind Nokia and Samsung. Neither Nokia nor Samsung have anything to fear from Apple for the moment – they’re … Continued
The Wall Street Journal reported this morning that Microsoft and Nokia have toyed with the idea of making a bid for RIM, whose stock has plummeted (from about $59 to start the year to about $14 in mid-December) and whose management team has been under fire from investors. The Journal reports that the status of any talks between Microsoft, Nokia and RIM are unclear. Other scuttlebutt is that RIM executives have hit up Samsung and HTC about possible licensing deals.
Both companies have challenges ahead. Nokia is trying to regain relevance in the mobile market, hence the partnership with Microsoft. And T-Mobile USA has been positioning itself to be acquired by AT&T. The two men were asked how their companies were going to help each other during this transition period.
NY Times: The opening for Nokia, Mr. Elop explained, depends on Nokia’s ability to exploit the rapidly shifting market in smartphones, to profit from its new alliance with Microsoft and to develop services based on its own assets, like the … Continued
Bloomberg: Apple, which will introduce a new iPhone version tomorrow, ships fewer handsets to the world’s second-largest mobile-phone market than it does to Norway. Nokia Oyj and Research In Motion Ltd. sell more devices in India, where smartphone shipments are … Continued
Benedict Evans: Of course, the picture would be equally bad if Nokia had chosen Android or stuck with Symbian/Meego instead of choosing Windows Phone – Nokia simply has no competitive devices in the mid range and high end of the … Continued
The patent infringement settlement between Apple and Nokia did more than stock Nokia’s pockets full of cash, it also gave the company some much needed time to change. Experts peg Apple’s one-time payment to Nokia at $650 million. Apple will … Continued