Nokia, the one-time mobile device giant that lost its glory, is finalizing plans for its grand re-entry to the mobile device world. Recent developments which have been disclosed by the company in a statement show that all is on course for the first batch of Nokia mobile devices to roll off the assembly line soon and be available in the market by the end of the year.
We have known for long that Nokia was planning a comeback but it is only now that finally everything seems to be falling in place for that long-awaited return to the mobile market.
In order to set things in motion for its return to the mobile market, Nokia had to clear a few hurdles first since it had previously entered into an agreement with Microsoft when it sold off its mobile division back in 2013 and licensed the Nokia brand to the company.
We have been waiting for this for so long
The course of that happening involves several deals.
- A new company based in Nokia’s home, Finland, has been formed to take charge of the entire process as well as “own” the Nokia brand. Nokia has signed with the company, HMD Global, a 10-year license that will see it exclusively make and distribute Nokia-branded feature phones, smartphones and tablets for the next decade.
- Both HMD Global and FIH Mobile (a subsidiary of Foxconn) have agreed to buy the feature phone device lineup that Microsoft inherited from Nokia that has to date kept the Nokia branding. This is a complete acquisition of assets (including Microsoft Mobile’s manufacturing facility in Vietnam), branding, software and services and 4,500 employees. The deal is worth $350 million according to Microsoft. The transaction is expected to close in the second half of the year.
- HMD Global has acquired rights to use the Nokia brand on feature phones. So in effect, HMD Global will continue to make and market Nokia-branded feature phones alongside the smartphones and tablets that it has been licensed to make and market by Nokia itself.
- Since HMD Global is sharing the spoils with FIH Mobile, it has gone ahead to sign an agreement with FIH Mobile that sees it gain operational control of sales, marketing and distribution of Nokia-branded mobile devices. As such, there should be no conflict between the two. HMD Global will run the show with FIH Mobile as a partner. The latter will avail its facilities including sales and distribution networks, supply chain and engineering to the former under the terms of their agreement.
- HMD Global will pay Nokia annual royalties as a result of the 10-year licensing deal.
- Arto Nummela will head HMD Global as CEO once everything is finalized. Nummela, a Nokia veteran, is the current head of Microsoft’s Mobile Devices business for Greater Asia, Middle East and Africa, as well as Microsoft’s global Feature Phones business.
- While Nokia will have a seat on HMD Global’s board, the company won’t invest in the new outfit or own any equity. It will simply be getting annual royalties from HMD Global.
- HMD Global will make smartphones and tablets under the Nokia brand running on Google’s mobile operating system, Android. Finally, after the false start that was the Nokia X and its siblings, there will be some real Android hardware with a Nokia logo at the back. Good times ahead. Feature phones will still utilize the same proprietary software they have had under Microsoft since HMD Global has acquired rights to that as well.
- So now, in the light of the above happenings, what becomes of Windows 10 Mobile and other devices that were under Microsoft’s fold? Microsoft says that it will continue supporting older devices like the Lumia 650, 950 and others as well as providing support for devices from its other partners like Alcatel, HP, Acer etc.
Long story short, Nokia is back! HMD Global will design and develop the devices while Foxconn (remember the FIH Mobile link?) handles the manufacturing in its famous factories that also churn out Apple’s iPhones by the minute. All that with the blessings of the legends at Nokia.
Are you excited?
