The Microsoft and Nokia deal was recently approved by US regulators, and now the European Commission has given the go-ahead for Microsoft to buy Nokia’s smartphone business.
We heard about a week ago that the European regulators were expected to approve the deal, you can see a statement from the European Commission below.
“The Commission concluded that the transaction would not raise any competition concerns, in particular because there are only modest overlaps between the parties’ activities and the links between Microsoft’s mobile operating systems, mobile applications and enterprise mail server software with Nokia’s smart mobile devices are unlikely to lead to competitors being shut out from the market,”
The deal, which will see Microsoft take over Nokia’s mobile phone and services division, is worth $7.3 billion to Nokia. It has already been approved by the company’s shareholders.
Details of the Acquisition
As part of the deal, Nokia will license a number of patents to Microsoft over the next 10 years, and Microsoft will take over Nokia’s Lumia Windows Phone brand. This acquisition is not just a simple purchase; it represents a strategic move by Microsoft to strengthen its position in the mobile market. By acquiring Nokia’s smartphone business, Microsoft aims to integrate hardware and software more seamlessly, potentially leading to more innovative and cohesive products.
Microsoft has already taken over Nokia’s headquarters in Finland, and 30,000 Nokia staff will now work for Microsoft as part of the deal. This transition of employees is significant as it brings a wealth of experience and expertise in mobile technology to Microsoft. The integration of these employees is expected to enhance Microsoft’s capabilities in mobile device manufacturing and innovation.
Implications for the Mobile Industry
The acquisition has several implications for the mobile industry. Firstly, it marks a significant shift in Microsoft’s strategy. Historically, Microsoft has been a software-centric company, but this deal indicates a move towards becoming a more integrated hardware and software provider. This could lead to more competitive products in the market, especially in the smartphone segment where Microsoft has struggled to gain a significant foothold.
Moreover, the deal could impact other players in the mobile industry. Competitors like Apple and Google, who have established ecosystems of hardware and software, may face increased competition from a more integrated Microsoft-Nokia entity. The acquisition could also influence smaller smartphone manufacturers who rely on Microsoft’s Windows Phone operating system, as they may now have to compete directly with Microsoft’s own hardware offerings.
Additionally, the licensing of Nokia’s patents to Microsoft could have broader implications for the industry. These patents cover a wide range of technologies, and their use by Microsoft could lead to new innovations and advancements in mobile technology. It also provides Microsoft with a stronger patent portfolio, which could be used defensively or offensively in the highly competitive tech industry.
Source ZDNet
Image Credit: Digital Trends
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