Terms of Microsoft’s acquisition of Nokia and what it means to us!

We earlier posted about Microsoft’s acquisition of Nokia and here is why Microsoft clearly stated why it bought the smart phone manufacturer. Microsoft aims at tripling the windows smartphone sales by 2018, this was posted in the Microsoft News Center the details of their acquisition of Nokia.

In the terms mentioned by Microsoft include; The right to control and take over Nokia’s devices and services production departments including resources, production facilities, device and service sales, marketing activities and staff members. Microsoft will transfer about 32,000 workers from Nokia to Microsoft including 4,700 from Finland and 18,300 employees who are involved in direct manufacturing of Nokia phones.

Microsoft will take over the Lumia brand and the Asha brand, however Nokia will remain will the rights to retain its name Nokia, This will favour the growth of windows phone and only feature phones will retain the name Nokia.

Nokia will grant Mircosoft several licensing  rights such as a long term agreement with Qualcomm. However Nokia will also retain its patent portifolio and will grant a 10 year license to Microsoft to its patents and will allow Microsoft use its patents in HERE. There is also a clause where Nokia has the option to extend Microsoft’s mutual patent agreement if Nokia agrees.

Microsoft will also become a ‘strategic’ licensee of the HERE platform where it will pay Nokia separately for 4 years.

Microsoft plans to set up a new data center in Finland that will serve Microsoft customers in Europe.

What does this mean to us?

We are definately going to see more Windows phones, now that Microsoft controls the software and hardware manufacture, the production of windows phones is definitely going to grow and we have to wait till 2018 to see whether Mircosoft’s plan to triple the number of windows Phones will actually happen.

The Asha and Lumia brands are going to get buried, especially asha which will give room for more windows phones.

However Microsoft tells us that this acquistion is subject to approval, and will close at the close at the end of the first quarter of 2014.

We have attached the open letter from Microsoft CEO Steve Ballmar (Source: Microsoft)

Nokia and Microsoft have always dreamed big – we dreamed of putting a computer on every desk, and a mobile phone in every pocket, and we’ve come a long way toward realizing those dreams.

Today marks a moment of reinvention.

Nokia has an identity spanning 150 years of heritage, innovation, excellence, and change which began and will continue in Finland and around the world. From humble beginnings as a paper mill factory, to manufacturing rubber boots and car tires, and then to mobile phones, reinvention is in Nokia’s blood.

Nokia will now write its next chapter, focused on enabling mobility through its leadership in networking, mapping & location, and advanced technologies.

For Microsoft as well, today is a bold step into the future, a huge leap forward on our journey of creating a family of devices and services that delight people and empower businesses of all sizes.

Our partnership over the past two and a half years, which combined our respective strengths to build a new global mobile ecosystem, has created incredible results: award-winning phones and amazing services that have made Nokia Windows Phones the fastest-growing smartphones in the world.

Building on this successful partnership, we announced some important news today: an agreement for Microsoft to purchase Nokia’s Devices & Services business, to deliver more choices, faster innovation, and even more exciting devices and services to our customers.

Today’s agreement will accelerate the momentum of Nokia’s devices and services, bringing the world’s most innovative smartphones to more people, while continuing to connect the next billion people with Nokia’s mobile phone portfolio.

With the commitment and resources of Microsoft to take Nokia’s devices and services forward, we can now realize the full potential of the Windows ecosystem, providing the most compelling experiences for people at home, at work and everywhere in between.

We will continue to build the mobile phones you’ve come to love, while investing in the future – new phones and services that combine the best of Microsoft and the best of Nokia.

Nokia and Microsoft are committed to the next chapter.

Together, we will redefine the boundaries of mobility.

Steve & Stephen