Microsoft subtly confirms end of road for Nokia brand as acquisition closes

25 Apr 2014

Satya Nadella, CEO of Microsoft

Today some 25,000 former Nokia workers will start the day as employees of Microsoft Mobile Oy, the former Nokia Devices and Services business, following the formal conclusion of the US$7.1bn acquisition of the mobile giant.

While Microsoft welcomed Nokia’s device unit to the Microsoft family in a formal announcement, it was only towards the end of the statement – in the editors notes, actually – that the name change was confirmed.

“Microsoft refers to Microsoft Corp and its affiliates, including Microsoft Mobile Oy, a subsidiary of Microsoft. Microsoft Mobile Oy develops, manufactures and distributes Lumia and Asha and Nokia X mobile phones and other devices.”

So there you have it, the big question is when will the first devices actually branded ‘Microsoft Mobile’ enter the mainstream, or will they? The retention of Nokia X mobile brand suggests Nokia could still live as a brand within a brand.

Under the new structure, Nokia’s former CEO Stephen Elop will report to Microsoft’s CEO Satya Nadella and will serve as executive vice-president of the Microsoft Mobile Devices Group, overseeing an expanded devices business that includes Lumia smartphones and tablets, Nokia mobile phones, Xbox hardware, Surface, Percentive Pixel (PPI) products, and accessories.

“Today we welcome the Nokia Devices and Services business to our family,” Nadella said. “The mobile capabilities and assets they bring will advance our transformation.”

“Together with our partners, we remain focused on delivering innovation more rapidly in our mobile-first, cloud-first world.”

The acquisition will subsume more than 25,000 workers spread across 130 sites in 50 countries worldwide.

Microsoft said it will honour all existing Nokia customer warranties on existing devices.

One major change in the acquisition deal is that Microsoft will not be buying the Nokia factories in Masan, South Korea, or Chennai, India.

Microsoft’s US$50bn market opportunity

So where from here? Microsoft said Windows Mobile is the fastest-growing smartphone platform in the world.

That said, it still has some distance to go when you consider Google’s Android operating system is on 80pc of smartphones in the world, Apple’s iPhone accounts for 15pc of smartphones in the world, leaving Microsoft with around 5pc.

Either way, there is a lot to play for and with Nadella shaping Microsoft into a nimble mobile-first and cloud first company targeting a whopping US$50bn a year marketplace could turn out to be a lot of fun.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years