Nokia sale: Implications: Divisions on the block and rivals at risk
(Guardian (UK) Via Acquire Media NewsEdge) What does Microsoft's purchase of Nokia's handset business mean for its future? This is the second handset business the company has bought. The first was Danger, in February 2008 for $500m (pounds 322m). It produced a phone so dire it was withdrawn from sale after 42 days.
Now Microsoft is getting one of the best supply chains in the world, and brand names known around the world. The problem will be integrating the businesses and selling into big corporations that purchase thousands of devices at once.
As for Nokia, the remaining divisions, Location & Commerce (providing Here maps) and Nokia Solutions and Networks - are barely profitable. If Nokia doesn't have a handset business to feed, there's little benefit in running maps.
For NSN, which makes mobile infrastructure, the challenges are equally great. China's Huawei is a big threat. NSN is profitable, but barely.
For BlackBerry too, the outlook isn't great. Did the company's management try to interest Microsoft in buying it and fail? The fact that Microsoft has chosen to go with Nokia is very bad news for BlackBerry. The clock is probably ticking for the struggling handset maker.
Being partly bought out by Microsoft means Nokia has a new source of plentiful cash, with which it will renew its attempts to interest consumers and businesses. But by the time it catches Apple, the Cupertino company could be moving on to the next thing.
The deal is bad news for the Taiwanese smartphone maker HTC. It is heading into all sorts of trouble, expected to announce its first ever quarterly loss this week as it loses out to Samsung. There had been some murmuring that Microsoft might buy HTC. It is now likely to fall into the arms of a Chinese firm.
But for the man in the street much won't change at all at first. The acquisition won't close until early next year. Phones with Nokia's brand will still be on sale.
(c) 2013 Guardian Newspapers Limited.
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