Under a strategic agreement covering branding rights and intellectual property licensing, Nokia Technologies will grant HMD global Oy (HMD)-a newly-founded company based in Finland-an exclusive global license (excluding Japan) to create Nokia-branded mobile phones and tablets for the next ten years. The transaction is expected to close in second-half of this year.
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The Windows 10 Mobile OS update for the Nokia Lumia devices has finally arrived, and Microsoft, at last, has updated the way these devices function. The dismal sales performance of Microsoft’s feature phone wing selling a mere 15 million units in Q1 2016 may be one of the prime reasons. Arto Nummela, who previously held senior positions with Nokia and is now the head of Microsoft’s Mobile Devices business for Greater Asia, Middle East and Africa as well as Microsoft’s global Feature Phones business, will serve as CEO on closing of the Microsoft transaction.
Earlier on Wednesday, Microsoft announced it would sell its entry-level phone assets to Foxconn’s subsidiary FIH Mobile and HMD for $350 million. Even after years of market existence Microsoft’s Windows Phone has failed to capture a double-digit share of the global mobile phone market. The company has a hand in building nearly every piece of consumer electronics on the market, from the iPhone to the PlayStation 4, but its brand has largely been secondary to those of the companies it works for.
“We will be completely focused on creating a unified range of Nokia-branded mobile phones and tablets, which we know will resonate with consumers”, Nummela said in a statement.
The HMD smartphone and tablet portfolio will be based on Google’s ( GOOG ) Android operating system.
Nokia will have a seat on the board of directors at HMD global and it will furthermore “set mandatory brand requirements and performance related provisions”.
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FIH Mobile has snapped up the business, which Microsoft bought from Nokia in 2014 for $7.5bn (£5.2bn), for just $350m. As Windows 10 delivers significant new innovations, many older devices are not able to successfully upgrade without an impact on the customer experience. All this combined gives HMD the ability to sell hardware with the Nokia name on it all around the world.
