Microsoft buys and licenses the parts of Nokia mobile that matter, but will it make any difference?
Microsoft has just announced that they'll be buying Nokia's devices and services business, as well as licensing their patents and maps. Microsoft will pay close to $5 billion for the business, and almost $2.2 billion in licensing for the deal. It'll be paid out of their overseas cash reserve, which spares them the cost of repatriation. Stephen Elop, Jo Harlow, Juha Putkiranta, Timo Toikkanen, and Chris Weber will likely transfer to Microsoft. In Elop's case, he'll be returning to Microsoft. Here are the comments from Microsoft's release:
“It’s a bold step into the future – a win-win for employees, shareholders and consumers of both companies. Bringing these great teams together will accelerate Microsoft’s share and profits in phones, and strengthen the overall opportunities for both Microsoft and our partners across our entire family of devices and services,” said Steve Ballmer, Microsoft chief executive officer. “In addition to their innovation and strength in phones at all price points, Nokia brings proven capability and talent in critical areas such as hardware design and engineering, supply chain and manufacturing management, and hardware sales, marketing and distribution.”
One of the key reasons, according to John Paczowski at AllThingsD was:
- To prevent Google and Apple from foreclosing app innovation, integration, distribution and economics
So, Elop as the new Microsoft CEO? Nokia making integrated, proprietary phones and tablets (please don't call them "Windows Phones")? It's hard to see how the ultimate product will be substantially different from, or more successful than what they're offering now, but if Microsoft is to maintain relevance in the consumer mobile computing space, it'll have to be. I very much hope this succeeds for both companies. A lot of questions remain, however. Will it become more of an Apple model, or more of a Google + Motorola model? Will Microsoft be able to unify their efforts behind Nokia hardware any better as first party than third? Where's my Xphone and Xslate with Halo, Project Gotham, Gears of War, Office, Exchange, Sharepoint, Azure, and all their other killer features, with no Windows in the way?