Nokia is reportedly claiming that rumors of a Microsoft takeover are baseless. Nokia is moving ahead with plans to adopt Windows Phone as its smartphone OS.
The rumor mill
has been churning steadily over reports that Microsoft will purchase Nokia's
mobile phone business for around $19 billion.
despite a Nokia spokesperson telling Reuters that "these rumors are 100
blogger Eldar Murtazin, known for his digging into Nokia's affairs, tweeted May 31: "One small software company
decided last week that they could spent 19 bln USD to buy a part of small phone
vendor. That's it."
That was also
enough to pull the lever starting up the rumor mill. A tumbling Nokia stock
price and analysts' pessimistic comments about the company's prospects both
added some fuel. But Microsoft already has its sweetheart deal in place: an
agreement to port Windows Phone software onto Nokia's smartphones, in exchange
for roughly $1 billion over five years. What more could Microsoft stand to gain
by paying $19 billion?
transition from Nokia's homegrown mobile operating system, Symbian, to Windows Phone
is becoming a major speed bump for both companies.
continue to avoid the stock as Symbian smartphone sales are falling off faster
than expected and we are skeptical that new Windows Phone (WP) models will be
able to replace lost profits," Stephen Patel, an analyst with Gleacher &
Company, wrote in a May 31 research note. "Our checks suggest mixed carrier
support for Nokia's transition to WP."
voiced worries about Windows Phone's ability to substitute Symbian's
marketplace role with little attrition: "We remain concerned that WP industry
sales remain below 2mil units/quarter and that [Nokia's] scale will not be
enough to offset a faster-than-expected drop-off in Symbian phone sales."
see the Microsoft-Nokia deal as an outright win for Apple and its iOS
ecosystem-particularly if Microsoft purchases all or part of its new partner
for the aforementioned $19 billion.
Nokia is a great source of market share opportunity for Apple," Brian White, an
analyst with Ticonderoga Securities, wrote in a June 1 research note.
"Microsoft's myopic approach outside the PC market is likely to provide more of
a drag for Nokia mobile phone business and uncertainty for customers, allowing
Apple's iPhone to gain even further market share in the coming quarters, in our
market research firm comScore, Windows Phone's share of smartphones continues
to dip. The first Nokia devices loaded with the operating system will likely
arrive in the fourth quarter of the year. By then, what will Nokia look like as
Nicholas Kolakowski is a staff editor at eWEEK, covering Microsoft and other companies in the enterprise space, as well as evolving technology such as tablet PCs. His work has appeared in The Washington Post, Playboy, WebMD, AARP the Magazine, AutoWeek, Washington City Paper, Trader Monthly, and Private Air. He lives in Brooklyn, New York.