Microsoft Buys Nokia's Smartphone Business, Cements Also-Ran Status

The Citizen's Guide to the Future
Sept. 3 2013 10:40 AM

Microsoft Buys Nokia's Smartphone Business, Cements Also-Ran Status

Microsoft CEO Steve Ballmer shakes hands with Nokia chairman Risto Siilasmaa after Nokia announced the sale of its mobile phone unit to Microsoft for $7.2 billion, bringing to an end its days as a phone maker.
Microsoft CEO Steve Ballmer shakes hands with Nokia chairman Risto Siilasmaa after Nokia announced the sale of its mobile phone unit to Microsoft for $7.2 billion, bringing to an end its days as a phone maker.

Photo by Sari Gustafsson/AFP/Getty Images

Microsoft is buying Nokia's devices and services business in a bold, $7.2 billion bid to cement its status as an also-ran in the smartphone marketplace.

The Redmond giant once dominated the software industry but was late to the mobile-software party and was rapidly surpassed by Apple and Google. In the Nokia deal, it acquires a business that once dominated the smartphone industry but was rapidly surpassed by Samsung. Synergies, indeed!

Advertisement

When the deal closes in early 2014, Microsoft will get Nokia's whole smartphone business, including the Lumia brand, plus its mobile phones business, which includes the low-end Asha brand popular in India and some other developing countries. It will also get licenses to the Nokia brand, patents, and mapping services. Nokia, meanwhile, will retain ownership of its brand as well as its mapping, networking infrastructure, and R&D divisions. As the Verge notes, it will become a much smaller company, though also perhaps a more sustainable one.

Microsoft, meanwhile, will go from being a minor afterthought in the mobile devices and services world to a much larger afterthought. Google, Apple, and Samsung may not exactly be quaking in their boots this morning, but BlackBerry is pretty much screwed.

Microsoft's shares fell 5 percent on the news, while Nokia's soared 35 percent.

Future Tense is a partnership of SlateNew America, and Arizona State University.

Will Oremus is Slate's senior technology writer.

TODAY IN SLATE

Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Students Aren’t Going to College Football Games as Much Anymore

And schools are getting worried.

Two Damn Good, Very Different Movies About Soldiers Returning From War

The XX Factor

Lifetime Didn’t Think the Steubenville Rape Case Was Dramatic Enough

So they added a little self-immolation.

Politics

Blacks Don’t Have a Corporal Punishment Problem

Americans do. But when blacks exhibit the same behaviors as others, it becomes part of a greater black pathology. 

Why a Sketch of Chelsea Manning Is Stirring Up Controversy

How Worried Should Poland, the Baltic States, and Georgia Be About a Russian Invasion?

Trending News Channel
Sept. 19 2014 1:11 PM Watch Flashes of Lightning Created in a Lab  
  News & Politics
Weigel
Sept. 20 2014 11:13 AM -30-
  Business
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
  Life
Quora
Sept. 20 2014 7:27 AM How Do Plants Grow Aboard the International Space Station?
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Tv Club
Sept. 21 2014 1:15 PM The Slate Doctor Who Podcast: Episode 5  A spoiler-filled discussion of "Time Heist."
  Arts
Brow Beat
Sept. 21 2014 12:43 PM Watch Rachel Dratch and Tina Fey Do a Second City Sketch in 1997
  Technology
Future Tense
Sept. 19 2014 6:31 PM The One Big Problem With the Enormous New iPhone
  Health & Science
Bad Astronomy
Sept. 21 2014 8:00 AM An Astronaut’s Guided Video Tour of Earth
  Sports
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.