Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times technology reporter Janet I. Tu.
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December 4, 2013 at 11:48 AM
Two days after the U.S. Department of Justice approved Microsoft’s $7.2 billion purchase of Nokia’s devices and services business, EU regulators did the same.
The European Commission approved the deal, saying in a news release:
The Commission concluded that the transaction would not raise any competition concerns, in particular because there are only modest overlaps between the parties’ activities and the links between Microsoft’s mobile operating systems, mobile applications and enterprise mail server software with Nokia’s smart mobile devices are unlikely to lead to competitors being shut out from the market.
Microsoft expects the purchase to be finalized early next year.
December 2, 2013 at 10:43 AM
The U.S. Department of Justice has approved, without conditions, Microsoft’s acquisition of Nokia’s handset business, according to Microsoft.
Regulators in India, Russia, Israel and Turkey have already approved the acquisition.
November 19, 2013 at 8:11 AM
Microsoft’s move to acquire Nokia’s phone business moved another step closer to completion as Nokia shareholders voted today to approve the deal.
John Stoll, Stockholm bureau chief of The Wall Street Journal, tweeted this morning:
Microsoft, you got your wish. Nokia shareholders green light $7B handset deal at meeting in Helsinki.
— John Stoll (@johndstoll) November 19, 2013
The vote came at a extraordinary meeting of shareholders held today in Helsinki.
October 29, 2013 at 12:40 PM
Nokia, whose phone business is being acquired by Microsoft, is reporting some good news about its Lumia line of Windows Phones.
The Finnish phone-maker reports that its third-quarter shipments of Lumia phones has increased 19 percent quarter-on-quarter to 8.8 million units.
Year-over-year, Lumia volume rose 203 percent, up from 2.9 million units shipped in the third quarter of 2012.
Nokia attributed the increase to “our recently broadened Lumia product range and strong customer demand, particularly for the Lumia 520.”
Microsoft’s $7.2 billion deal to purchase Nokia’s phone business is expected to close early next year.
The increase in Lumia shipments, however, wasn’t enough to boost the once-dominant phone-maker into the ranks of the top five smartphone vendors.
Here are the top five, according to research firm IDC:
October 22, 2013 at 8:20 AM
At the Nokia World event in Abu Dhabi earlier today, Nokia announced its first Lumia tablet — the Lumia 2520 — and two 6-inch Windows Phone phablets — the Lumia 1520 and Lumia 1320.
My Seattle Times story on that announcement is here.
And here’s a quick rundown of the new devices: (more…)
October 9, 2013 at 7:36 AM
The Bellevue Square store will be among 10 Microsoft Stores hosting a midnight launch of Surface 2 and Surface Pro 2, which are scheduled for release on Oct. 22.
September 3, 2013 at 12:59 AM
In case you missed it, here’s my first-day story on Microsoft’s $7 billion purchase of Nokia’s handset business, which includes parts of an interview I had with Microsoft CEO Steve Ballmer and Nokia Chairman and Interim CEO Risto Siilasmaa.
The story (which is running in the print edition of The Seattle Times today) didn’t have enough space to include more from the interview. So here are more tidbits.
On how long the deal has been in the works:
Ballmer said it began earlier this year when he called Siilasmaa about getting together in Barcelona during the Mobile World Congress in February. Ballmer wanted to discuss “ways in which we might improve our partnership,” he said.
During the meeting, Siilasmaa requested a complete examination all the different forms the partnership could take, as well as alternatives.
“I was probably thinking acquisition at the time,” Ballmer said.
On what Microsoft would gain by owning Nokia’s handset business directly, rather than just partnering with Nokia:
“We’ve been working very well together,” Ballmer said. “But at the end of the day, we’re two companies that need to protect relative value for their shareholders.”
With Microsoft purchasing Nokia’s phone business outright, “we remove any boundaries in agility,” he said.
He gave the example of the Nokia Lumia 1020 Windows Phone. “We had to each be very careful” because each company had other partners that it had to keep in mind.
Plus, “Nokia Lumia Windows Phone 1020 is a mouthful,” he said, laughing. “We can probably do better as a company.”
When asked what name might be used instead, he said, again laughing: “Something like Microsoft Windows Phone” might sound good.
Ballmer said Microsoft has bought the rights to the Lumia and Asha names. (Asha is the name of Nokia’s smartphones aimed at emerging markets.)
He said having one company making decisions on everything from innovations to marketing would make things more efficient, with higher returns.
Microsoft posted a slideshow presentation with more of the company’s thinking on the strategic benefits of the acquisition.
In one slide, Microsoft says Windows Phone’s royalty gross margins, under the current partnership, is less than $10 per unit. In addition, Microsoft pays Nokia to support the platform and invests in the marketing of its Windows Phone. If Nokia’s phone business became part of Microsoft, the smart device gross margin would be more than $40 per unit, according to Microsoft. And the marketing effort could be more focused.
September 2, 2013 at 8:42 PM
Microsoft is buying Nokia’s handset business as part of a $7.2 billion deal, the two companies announced today.
Microsoft is paying about $5 billion (EUR 3.79 billion) for Nokia’s Devices & Services Business. In addition, it is paying about $2.18 billion (EUR 1.65 billion) to license Nokia’s patents and to license and use Nokia’s mapping services.
The businesses that Microsoft is getting from Nokia brought in about $19.7 billion (EUR 14.9 billion) revenue in 2012, about half of Nokia’s sales that year.
Nokia retains other substantial parts of its business including networking infrastructure and services, technology development and licensing, and mapping and location services. Its patent portfolio remains within Nokia, which is granting Microsoft a 10-year non-exclusive license.
Nokia CEO Stephen Elop is stepping down from that position, and becoming executive vice president of Nokia’s Devices & Services division, leading its transition into Microsoft.
Once the transition is finalized, Elop becomes an executive vice president at Microsoft, heading a devices division that will include Windows Phone, as well as Xbox and Surface. Julie Larson-Green, current executive vice president in charge of the Devices & Studios division at Microsoft, will report to Elop.
(Elop’s name has come up fairly frequently as a possible successor to Microsoft CEO Steve Ballmer, who announced last month that he would be retiring once his successor has been chosen within 12 months.)
In total, Microsoft is getting Nokia’s mobile, smartphone and smart devices units; its design team; its production facilities; and its sales, marketing and support operations, according to Nokia.
Most of Nokia’s employees will remain where they are. After the deal closes, the roughly 32,000 employees in Nokia’s Devices & Services division — slightly more than half of them working in manufacturing and assembly in Nokia’s production facilities around the world — will still work in those facilities, but will work for Microsoft. About 4,700 of those employees work in Finland in research and development, engineering, design, and operations and will remain there.
“Bringing these great teams together will accelerate Microsoft’s share and profits in phones, and strengthen the overall opportunities for both Microsoft and our partners across our entire family of devices and services,” Microsoft CEO Steve Ballmer said in a news release. “In addition to their innovation and strength in phones at all price points, Nokia brings proven capability and talent in critical areas such as hardware design and engineering, supply chain and manufacturing management, and hardware sales, marketing and distribution.”
Nokia has made Microsoft’s Windows Phone its primary smartphone operating system since 2011 and its Lumia line of Windows Phone has been credited with giving Microsoft a tiny gain in market share over the past several months even as the OS in general struggles for a foothold in the marketplace. (Windows Phone has about a 3.3 percent worldwide market share.) But Nokia has been floundering and though it’s narrowed its losses lately, it still posted a $151 million loss last quarter.
Nokia said it expects to gain about about $4.2 billion (EUR 3.2 billion) on the sale.
The Finnish company retains the Nokia brand and under a 10-year agreement, Microsoft has said it would use the Nokia brand on certain mobile phones based on its Series 30 and Series 40 operating systems.
However, Nokia is restricted from using its own name on its own mobile devices until Dec. 31, 2015.
Microsoft is using its overseas cash reserves to fund the cash purchase, which is expected to close in the first quarter of 2014, subject to approval by Nokia’s shareholders and regulatory approval, according to a news release. Microsoft had reported having about $77 billion in cash reserves in a financial document filed with the U.S. Securities and Exchange Commission.
Such an acquisition “has been on everyone’s minds on and off,” Al Hilwa, an analyst with research firm IDC, said in an email. “It is good for both companies to see it happen. Nokia has a highly evolved device design and manufacturing process which will benefit Microsoft greatly. This is simply the fastest path in front of Microsoft to achieve something like Apple’s vision on devices. The key to progress in this space does not change, namely will Microsoft be able to create critical mass with its platform.”
August 26, 2013 at 7:14 AM
Microsoft’s Windows Phone operating system has finally been inching up in worldwide smartphone market share, thanks in large part to Nokia’s Lumia phones.
Will Nokia be able to do the same for Microsoft’s Windows RT tablet operating system?
Nokia is apparently planning to release soon a 10.1-inch tablet that resembles its colorful Lumia line of Windows Phones, according to a report in The Verge.
The tablet, codenamed “Sirius,” is reportedly thinner and lighter than the iPad, The Verge reports.
Windows RT is Microsoft’s version of Windows 8 designed specifically to run on devices powered by power-saving ARM processors.
It has not been doing well in the market, holding about a 0.5 percent share, according to research firm IDC.
In the last quarter, Microsoft had to take a $900 million writedown for Surface RT, the version of Microsoft’s Surface tablet that runs Windows RT. The writedown was due, in large part, to the $150 price cut for Surface RT devices that Microsoft instituted days before announcing the writedown.
July 18, 2013 at 8:22 AM
Nokia sold a record 7.4 million Nokia Lumia Windows Phones in its fiscal second quarter, an increase of 32 percent from the first quarter, the Finnish phone manufacturer announced in its earnings report today
“We are very proud of the recent creations by our Lumia team, from the Lumia 520 – our most affordable Windows Phone 8 product … to the Lumia 1020, our star imaging product which we unveiled to the world last week,” Nokia CEO Stephen Elop said in a news release announcing the quarterly earnings results.
Though the company’s Lumia smartphone sales increased, its feature mobile phone sales decreased 4 percent quarter-on-quarter to 53.7 million units. Elop said, however that in the latter part of the second quarter, those sales “started to demonstrate signs of recovery.”
Overall, Nokia had a disappointing second quarter, with sales down 24 percent year-over-year to 5.7 billion euros (U.S. $7.46 billion). The results missed analysts’ expectations.
Nokia shares fell after the report and as of Thursday morning were trading at $3.95.
Microsoft, too, is announcing its quarterly earnings — its fiscal 4th quarter and year-end results — today. Here’s a preview of what to expect in the Q4 earnings.