New-Tech Europe | September 2016 | Digital Edition

since now the carriers were even less likely to want to work with Microsoft since they were not just the software supplier, they were the hardware supplier, too. The business continued to bleed away. With the obvious exception of Apple, the mobile industry had standardized on Android, and the Windows Phone market share went down to insignificant. Conspiracy theorists surmise that Elop was “sent” byMicrosoft to Nokiawith two goals. First, to switch Nokia to Windows Phone so that their huge market share would jump-start Windows Phone and other manufacturers would want to follow. Second, having done that to deliver Nokia’s smartphone business to Microsoft with a pink bow on top. Well, both those things happened but that doesn’t make any of it a success. Nokia phone Almost exactly a year ago, Microsoft realized that the acquisition had been a huge mistake. They wrote down the acquisition by $7.6B (around the acquisition cost) and laid off

thousands more people. In May this year, Microsoft gave up on the feature phone business and sold it all to Foxconn (the company that famously manufactures the iPhone, among other products) for $350M. They said they would continue to develop Windows Phone and support the Lumia smartphone brand, but it seems to me only a matter of time before they will be forced to give up on that too. They won’t be coming back from their miniscule market share. So why did I add “and maybe rise again” to the title to this post? Because just last month, Nokia announced that it would return to the smartphone business. Under the terms of the sale of the handset business to Microsoft, Nokia was barred from using the Nokia name to sell mobile phones, since Microsoft had a period of exclusivity. That period is up this year. CEO Rajiv Suri announced that Nokia could design the smartphone (it still has resources in house, and after all

the layoffs there are probably plenty of the old team left in Finland who could be rehired). Nokia doesn’t have its legendary manufacturing facilities since Microsoft got those so it would license the design and the Nokia name to as yet unnamed partners. Maybe even, ironically, Foxconn, who could presumably also put the Nokia name back on the feature phone business it just bought from Microsoft. Nokia feature phones were legendary in places like Africa and South America for robustness and that name probably still has a lot of brand equity in emerging markets where smartphones are too expensive (for now). Moreover, just as the carriers decided Microsoft would not be a success, maybe they will decide Nokia will be.

This story is not over yet.

Thanks to Tomi Ahonen who created the graphs from Nokia data and makes them freely available on his blog.

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