Nokia will be able to make phone via brand-license deals after the second half of 2016.
Once the biggest phone manufacturer in the world, Nokia, has announced that it will start making phones again. In an interview given to Germany’s Manager Magazine, Nokia CEO, Rajeev Suri said that Nokia is planning to license the brand from 2016. The reason for the hiatus is that the Finnish company which sold its mobile business to Microsoft in 2013 also signed a deal to stay away from the mobile business till the second half of 2016. So, in the second half of 2016, Nokia will be free to license its design and brand name but not manufacture phones.
Microsoft, which acquired Nokia’s mobile business for $7.2 billion, has not been able to make Windows Phone a majority player in the mobile market up till now. The company has barely reached 3% market share (IDC) by Q1 2015. On top of that, the company is losing money on the devices business. This has further led to Microsoft's Device’s head, Stephen Elop being shown the door. This has led many analysts to believe that Microsoft is focusing on its core software business. There are also rumors in the air that Microsoft could write-off its devices business, most of which it acquired from Nokia. While the upcoming Windows 10 platform might turn things for Microsoft, the Redmond giant appears to be grasping at straws in the mobile business.
Coming back to Nokia, Suri also said in the interview that the company is looking out for suitable partners. The company has already made a tablet (Nokia N1) under a brand-licensed deal with contract manufacturer Foxconn, (which also makes devices for Apple). And we will be eager to see like everyone else, if and how can the old phone giant can make a comeback.
While Nokia’s mobile business is still in shackles, the company is moving ahead with its other businesses. In order to boost its network equipment business Nokia recently acquired Alcatel-Lucent for $17.8 billion. The company is also selling off its mapping business, HERE maps which has drawn attention from many major car manufacturers like BMW, Audi and Mercedes. While the company has not finalized anything yet, Mr. Suri said, “Anybody who can improve the business in the long run is a good buyer."
Source: Manager magazine
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Hardik Singh
Light at the top, this odd looking creature lives under the heavy medication of video games. View Full Profile
