The move will effectively see Nokia return to the mobile phone market in its own right, with a new deal set up with new Finnish startup HMD global that will see a new wave of Nokia-branded phones and tablets over the next ten years.
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It was announced Wednesday that Microsoft has come to terms with FIH Mobile Ltd., a subsidiary of Hon Hai/ Foxconn Technology Group and HMD Global in a $350 million deal.
As part of the deal between Microsoft and FIH Mobile, the latter will acquire Microsoft Mobile Vietnam, the company’s Hanoi manufacturing facility.
The purchase only includes “feature phones” business but the new company has plans to start development of future Nokia-branded smartphones and tablets that will run Android OS.
HMD chief executive Arto Nummela said that branding is important to tell apart different mobile phones, which is why the startup is centered on the Nokia brand. You can look forward to seeing some great Android based Nokia smartphones later this year. The transaction is expected to be completed in the second half of this year.
Nokia once dominated the mobile phone market in a time when smartphones weren’t introduced yet.
Furthermore, in this leaked email to Microsoft execs obtained by Windows Central, Terry Myerson, head of Microsoft’s Windows and devices, mentions “next generation” products. But having sold its mobile and devices devision to Microsoft and seeing nothing happen, now is another chapter in its history as it sells its brand to HMD global.
It is worth remembering that Nokia and Foxconn have worked together before on several occassions; a recent collaboration which saw the Taiwanese company design, develop and distribute a Nokia-branded tablet computer now looks nearly to have been a trial run for yesterday’s tie-up.
Despite this trend, a large market continues to exist for more affordable feature phones.
After this news of Microsoft’s feature-phone business sellout, it is quite clear that the US-based company was not reaping any benefits from selling Lumia phones and clearly the deal was required to focus on Windows 10 and cloud. But it won’t be an easy return, Nokia will have to compete with companies such as Apple, Samsung, Huawei, Lenovo and Xiaomi.
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As part of the deal, Nokia will be providing brand and patent licensing to HMD, and will take a seat on the board of directors of the company.
