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Nokia CEO Stephen Elop.  (Source: WPCentral.com)

Newly appointed President of Nokia Inc. (US), Chris Weber.
Microsoft to pay out billions in blockbuster deal with Nokia

While the blockbuster deal that's amped to put Windows Phone 7 on all Nokia smartphones --essentially phasing out Symbian and making WP7 the world's second-most popular mobile OS in its place -- is supposed to benefit both parties involved, it has thus far been met with mixed reaction. 

The day the deal was announced Nokia's shares dropped 14 percent, and a number of employees -- many on the beleaguered Symbian side -- used the company's flextime program to go home early.

Then, at the Mobile World Congress event in Barcelona over the past weekend, Nokia CEO Stephen Elop was forced to go on the defensive, Business Insider reports, after an audience member asked if he was a Trojan horse. 

"The obvious answer is no," Elop replied. "We made sure that the entire management team was involved in the process, and of course the board of directors of Nokia are the only ones that can make this significant of a decision about Nokia. They made that final decision on Thursday night."

The question was an obvious reference to Elop's past at Microsoft, where he was an executive for two years before taking the top spot at Nokia. To some, it may seem a little strange that Nokia would make such a partnership with Microsoft, particularly after its 10-year investment into Symbian. 

Elop also had to defend his shares of Microsoft stock, which Business Insider reports to be approximately 130,000 shares worth nearly $3.18 million.

Conspiracy theorists received additional ammunition Friday, when Nokia announced Chris Weber as its new president of Nokia Inc. (US) and head of the North American market after current president, Mark Louison, "decided to leave Nokia and pursue new career opportunities." Weber spent 16 years at Microsoft, where he held executive positions as high as corporate vice president.

While solid details of the agreement between the two companies have not been released, news surfaced over the weekend that sheds light on just how big the deal is. According to Computer Worldwhile showing a slide that portrayed Microsoft's investments flowing in Nokia's direction, Elop said, "the value transferred to Nokia is measured in Bs not Ms." Meaning, Microsoft pay-out to Nokia in the deal would be in the billions, not millions, of dollars. No additional details were given, like over how many years the investments would take place.

We also learned that Google was actively pursuing Nokia in what could have been a similar deal, but Microsoft won out, according to Elop. "If you combine the current market share of Android with the market share that Nokia could deliver to Android over the next couple of years, it’s a very large number. One could believe the mobile industry thereafter would be some form of duopoly," Elop said. The decision to go with Microsoft over Google was made to change the dynamic and make it "a three-horse race," as Elop said. Presumably, the multi-billion-dollar investment doesn't hurt, either.

As for availability, a top executive told Computer World that the first WP7-powered Nokia's will be available this year.



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RE: Symbian wasnt cutting it.
By Tony Swash on 2/14/2011 5:35:19 PM , Rating: 2
quote:
I couldnt possibly agree less with this. I cringe at the thought of needing ANOTHER propietary cable that does NOTHING other than over charge me for something I've been doing forever. Only the most dedicated mac users can appreciate the 'feature' of this proprietary connector. Mini USB FTW, as long as the phone manufacturer doesn't put it in an awkward place.


I think your are missing my point.

I wasn't arguing whether the bespoke 30 pin Apple connector for iDevices was a good or bad thing, either technically or from the point of view of the convenience of the end user. I am expressing no view of that.

I am saying that using a bespoke connector makes enormous business sense for Apple. If the i-Devices used, lets say, a standard USB connector then all the vast number of accessories for the i-Devices would also be available for Android, Rim or (if anyone can find one) a WP7 phone. Instead as it stands now if you start collecting such accessories soon you will find switching to another device brand very difficult.

This is exactly the position that many DSLR camera owners find themselves in. They are often locked into a camera brand by their expensive lens collection. I committed to a Nikon DSLR early on and soon had quite a collecting of lenses, the cost of these lenses together is now actually more than the camera. I now buy camera's that are compatible with my lens collection.

It's pretty clear that that is what Apple has done with the 30 pin connector. I would do it to if I were them.


RE: Symbian wasnt cutting it.
By davmat787 on 2/15/2011 1:38:33 PM , Rating: 2
Proprietary interfaces cuts both ways however. Yes, it will mentally "lock" someone in to Apple, but conversely it can lock a potential customer out as well. Their collection of standard cables will not work for their shiny new iThingy, so have to buy a $30 dollar cable that does the exact same thing as their $2 standard USB cable. This does not build goodwill either.

Proprietary cuts both ways by its very nature. I would guess if you look back on computer technology as a whole, proprietary interfaces can be more detrimental to a company than going with the standards.

If you ever worked on a Packard Bell PC, I think you know what I mean.


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