For the last several years Nokia has been fighting tooth and nail with Apple, Samsung, Motorola and other mobile handset manufacturers. Yet despite its best efforts, including a partnership with Windows Phone 8, the once reigning king of cell phones has managed only modest success with mounting losses. Now with the Lumia 920 finally proving that Nokia can still create great products, it appears as though the company might sell its mobile handset division.
According to Keepskor founder and Forbes contributor Tristan Louis:
“The biggest shocker (and what I suspect will be my most controversial prediction), though, will be the the [sic] departure of Nokia from the phone business as the company sells its mobile operation and infrastructure divisions to Huawei in order to focus on software and services. With the company’s bet on Windows [Phone] 8 having failed in the marketplace, it will see Microsoft (MSFT) and Huawei competing for the mobile device division and will eventually sell its smartphone group to Microsoft and the rest of its telecom interests to Huawei.”
Rumors began circulating in 2012 that Microsoft would attempt to build its own smartphone line. Those rumors started almost immediately after Microsoft turned into an OEM with the build of its Surface tablet devices. By purchasing Nokia the tech giant would gain instant access to its own manufacturing facilities and would acquire the mobile know-how of industry experts. With the recent success of the Lumia 920 Microsoft would also be given some “street cred” among mobile users.
Purchasing a mobile device manufacturer could give Microsoft a leg up on new competition as Amazon is rumored to be working towards a Kindle Smartphone and other manufacturers have also eyed a larger slice of the smartphone market, including Sony which plans to reignite its Xperia line of Google Android based smartphones in 2013.
With Nokia losing money in six straight quarters while burning through its cash reserves now could be the perfect time for Microsoft to swoop in and buy the company at an undervalued share purchase.
[Image via unitedmobile]