Microsoft Acquires Nokia Phone Division for $7 billion

By | September 13, 2013

Microsoft has made yet another major acquisition after taking over Skype in 2011. According to the reports, Microsoft is acquiring the Nokia device and services unit for getting a strong foothold in the mobile phone industry. Nokia has been the biggest supporter of the Windows Phone 8 platform accounting for more than 82 percent of Windows Smartphone units. The deal is expected to close in the first quarter of 2014. Microsoft will transfer 32,000 employees under its roof including the employees under the manufacturing division.

Microsoft Planning to Enter the Smartphone Industry and Set a Strong Foot

Microsoft has been trying hard to enter the Windows Phone market without any luck until now. The acquisition of the Nokia mobile division will offer the control of both hardware and software to the tech-giant. According to Steve Ballmer, Microsoft CEO, this merger would carry benefits for the companies, consumers, and shareholders. It is a bold step into the future according to the Microsoft CEO.

Microsoft has struggled against the other Smartphone providers such as Samsung and iPhone in the past few years. Microsoft acquisition of Nokia will help the company in gaining the low-end Smartphone market in developing countries with the Nokia Asha brand. Microsoft is eyeing for an access to the millions of consumers looking for budget Smartphone. Further, the acquisition will Nokia to land in a healthy financial zone.

The chairman of Nokia, Risto Silasmaa, is hoping for a healthy future of the company after the deal. The company would target three major businesses including HERE, NSN, and Advanced Technologies brand. NSN is the network infrastructure service that caters a large audience throughout the world. HERE is the location-based service offered by Nokia, which offer real time traffic reports and map services to the consumers. The company has announced new ties with Mercedes-Benz for future projects. The Advanced Technologies Division will continue to work in the development and licensing operation.

Stephen Elop Will Join Microsoft

It is quite known to everyone that Microsoft is looking for a successor for the current CEO Ballmer. According to the arrangement, Stephen Elop will join Microsoft to manage a new devices team and other responsibilities in the future. Some key members of Nokia will migrate to Microsoft after the deal including Jo Harlow, Juha Putkiranta, Timo Toikkanen, and Chris Weber.

Nokia will enter the device and service category with the acquisition of Nokia. It will have the end-to-end control like Apple and BlackBerry to achieve better results in the future. However, the big question is that whether Microsoft will succeed where Nokia failed! Was Nokia the real problem behind the slow Window Phone 8 growth?  Let us hope that this acquisition will help this Tech Giant in becoming the market leader in the Smartphone industry.

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