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Microsoft to Acquire Nokia for $7.2 Billions : What’s going to change?

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Nokia, ruled the Mobile phone industry for more than half a decade. Back in 2001-2006, Nokia competed with Sony Ericsson, Motorola, still it managed to steal maximum percentage of the market in Asian countries like India & China. But, after Apple launched iPhone back in 2007, Nokia started losing it’s demand gradually. Despite of it’s popular N series mobiles pieces, Nokia failed to prove themselves in SmartPhone industry and lost it’s track just like it’s competitors Sony Ericsson and Motorola.

But, still the Mobile giant didn’t give-up so easily. It launched it’s new SmartPhone series with name “Nokia Lumina” with fresh Windows 8 flavor. Nokia started working with Microsoft since past couple of years and the results of both the companies seemed to be improved a bit. As we all know that, Google Acquired Motorola couple of years ago and now Microsoft is going to acquire Nokia for whopping $7.2 billions.

microsoft and nokia merger

So, we are going to check out few changes and facts about Acquisition.

#1. The Acquisition cost of Nokia($7.2 billion) is cheaper than Skype ($8.1 billion). Out of $7.2 billion, Microsoft is paying around $5 billion for Nokia’s devices and Services and over $2 billion for licensing the Patents of Nokia.

#2. Microsoft acquired the business units like SmartPhones(includes Lumia Series), Mobile Phone units (including Asha series). However Nokia will continue to manage its own Brand.

#3. Microsoft’s Current CEO is going to depart in next 12 months, and rumors are going around as Nokia CEO Stephen Elop might be his successor as Elop also worked as the former Microsoft Executive till 2010.

#4. It is expected that around 32,000 employees from Nokia are getting transfered to Microsoft, including 18,300 employees who are directly involved in the manufacturing department.

#5. Nokia is ready to assign the patent license agreement with Qualcomm to Microsoft along with few other licensing agreements.

#6. Elop’s statement “With this transaction we can accelerate our current movement and gain a stronger financial backing to be more successful in the mobile market”

Thus, these are the some of the things that you need to know about the Microsoft’s acquisition.


Siddartha is a Blogger from India. He is currently working as a Java Front End developer and he loves writing about tutorials, technology, algorithm, etc. You can follow him on Twitter | Facebook | Google+. You can subscribe to GadgetCage RSS Feed or Email Notifications.

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