Nokia is coming back to mobile phone market
Yes! Nokia is back, but this time with Android. Nokia said on Wednesday it had signed an exclusive 10-year licensing agreement for newly-formed Finnish company HMD global Oy to create Nokia-branded smartphones and tablets. HMD is owned by Smart Connect LP, a private equity fund run by former Nokia executive Jean-Francois Baril, and its management.
Nokia will take a seat on the board of directors of HMD and will set standards for performance and brand requirements so “that all Nokia-branded products exemplify consumer expectations of Nokia devices, including quality, design and consumer-focused innovation.”
The products will be made by Taiwan’s Foxconn and Nokia will receive an undisclosed royalty on sales, covering both brand and intellectual property rights.
Microsoft announced simultaneously it would sell its entry-level phones business to HMD and Foxconn subsidiary FIH Mobile for $350 million. It also acquires Microsoft Mobile Vietnam, which along with its 4,500 employees were responsible for manufacturing the Nokia-branded feature phones.
“We will be completely focused on creating a unified range of Nokia-branded mobile phones and tablets, which we know will resonate with consumers. Branding has become a critical differentiator in mobile phones, which is why our business model is centered on the unique asset of the Nokia brand, and our extensive experience in sales and marketing.” – Arto Nummela , CEO of HMD global, said in a press release.
As Nokia’s announcement warns “there is still much work for HMD to do, so you’ll need to wait a bit longer to see what the next wave of Nokia phones and tablets look like.”
Microsoft has struggled with phones after the 2014 deal with Nokia, and last year it wrote off $7.5 billion from the business. Microsoft said on Wednesday it would continue to develop its Lumia smartphones.