Microsoft's $7.1B Nokia Deal Gives It a Shot at the Bronze

By Michelle Maisto  |  Posted 2013-09-03 Print this article Print

By the terms of the deal, Nokia will be immediately overseen by interim CEO Risto Siilasmaa, chairman of the Nokia board of directors, as Stephen Elop transitions into the role of executive vice president of Devices & Services at Microsoft. Nokia will also retain its NSN, Here and Advanced Technologies businesses.

"The sale gives [Nokia] a healthy war-chest, while freeing it of a white elephant that was draining cash," says Ken Hyers, a U.S.-based senior analyst with Strategy Analytics. "Networks can now focus on expanding its equipment and services business, Here (the mapping business) can focus on winning new customers among automakers, and the patent business will be a source of ongoing revenues."

As for the last group this deal might benefit—those who have bought Nokia smartphones—Forrester analyst Ted Schadler blogged Sept. 3 that the deal should give them comfort.

"Microsoft is doubling down on mobility, and that can only be a good thing for you," Schadler wrote, speaking to the CIOs of the world. "You can have more confidence that your Windows 8 tablet trials will be joined by a renewed Microsoft commitment to devices + services across tablets and phones."

Siilasmaa, Nokia's new CEO for the moment, said in a statement that the deal marks "a moment of change and reinvention" for Nokia and its employees, approximately 32,000 of whom will go to Microsoft.

"With our strong corporate identity, leading assets and talent, and from a position of renewed financial strength," said Siilasmaa, "we will build Nokia's next chapter."

Elop, in a statement on the Microsoft site, said the deal will bring together "the best of Microsoft's software engineering with the best of Nokia's product engineering, award-winning design, and global sales, marketing and manufacturing."

He continued, "With this combination of talented people, we have the opportunity to accelerate the current momentum and cutting-edge innovation of both our smart devices and mobile phone products."


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