Daily Dose of iQ: Microsoft's Nokia Devices Acquisition Marks End Of Old Mobile Era

Sep 03, 2013 — Tara Bartlett

By now you’ve probably heard the news that Microsoft acquired Nokia’s devices business for $7.2 billion.

Microsoft bought the devices and some of the services along with the services of former Microsoft Office leader Stephen Elop, who will run Microsoft’s Devices business. By all accounts, Stephen was a much-admired Microsoft executive when he left to run Nokia in 2010.

Microsoft will become a significant third player in the mobile mind shift.

Ted Schadler & Thomas Husson of Forrester Research share some possible take-aways of the acquisition:

  • Microsoft will elevate Stephen Elop’s position, possibly to CEO, perhaps at the 11th hour of Ballmer’s departure.
  • Microsoft will become a significant third player in the mobile mind shift, still behind Google and Apple in market share, but a very vital competitor and supplier.
  • The integration will go pretty well for the Lumia line but not for Nokia’s other businesses, particularly in developing nations. Microsoft headquarters is a very long way, physically and emotionally from India or Indonesia or Africa. It will make it harder for them to focus on those markets.
  • The quality of the Nokia Windows Phone experience will give more incentive to the Surface team to double down on Microsoft-owned tablets. Manufacturers like HP, Lenovo, and Dell will struggle to feel good about a Microsoft tablet even as they look for the best operating system for their own tablets.
  • The Windows business unit will wrestle with a desire to exert more control over the quality of the PC+Service experience of Windows 8 computers. They will want more vertical integration to deliver a better product experience.
  • Microsoft will spend a lot more money marketing and doing ecosystem business development for Windows Phone. It’s now or never to make Microsoft a major third player in smartphones.

Topics: Wireless Trends, Mobile Industry

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