Let us take our attention away from all the LG and Samsung announcements as well as leaks leading up to IFA 2013 for a moment. Microsoft has just announced that they ''will purchase substantially all of Nokia’s Devices & Services business, license Nokia’s patents, and license and use Nokia’s mapping services'', entirely to the tune of a cool $7.18 billion after conversion. This would mean Microsoft acknowledges that they need a far stronger hand to compete in the highly competitive mobile device environment, and despite Windows Phone 8 occupying 3rd spot at the moment, it still has a long way to go before it is capable of seriously challenging Apple’s iOS and Google’s Android mobile operating systems.
Part of this agreement would see Microsoft pony up EUR 3.79 billion to buy nearly all of Nokia’s Devices & Services business, with another EUR 1.65 billion being spent to license Nokia’s patents, resulting in a grand total of EUR 5.44 billion - in cold, hard cash. It is expected for this particular transaction to close in the first quarter of 2014, and will remain subject to approval by Nokia’s shareholders, regulatory approvals and of course, other closing conditions.
Will this bit of news see Microsoft’s share price spike up the way it did after Steve Ballmer announced his retirement within a year near the end of August? Only time will tell as the markets open tomorrow after the long Labor Day weekend, but with Microsoft having a direct say in Nokia now, it would be interesting to see the kind of comprehensive tie-ups that they can come up with.
Nokia’s HERE mapping services have been pretty decent for those on a shoestring budget since it is free and can be downloaded before you head off to the supported foreign country of your choice in order to save on potentially expensive data roaming fees, and when you merge that with Microsoft’s Bing Maps, the possibilities are enticing. It would also be nice to see how the mash up would result in a more comprehensive user experience in the long run.