INTRODUCTION
Microsoft is to acquire Nokia 's mobile phone arm in a swansong deal for the software giant 's long-serving chief executive, Steve Ballmer, delivering Europe 's last big handset maker into American ownership.
For €5.44bn (£4.6bn), Nokia is casting off the business that once represented Finland 's most important export, in a deal that will result in 32,000 staff transferring to Microsoft.
Overtaken in the smartphone arena by Apple and Samsung, Nokia 's board agreed to end the company 's decades-long role as a pioneer and once-dominant player in one of the most revolutionary technologies in modern history.
The acquisition marks the boldest step yet taken by Microsoft in its recently announced strategy of moving decisively
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Apple 's iPhone and handsets running Google 's Android together make up over 95% of sales in the US and China, the world 's two largest smartphone markets, according to Kantar World panel 's latest figures. Windows Phone only has shares above 10% in Mexico and France, according to the company 's figures.
According to the article, Under the deal, Microsoft is buying the Lumia and Asha brand names that Nokia has used for its smart and intermediate phones. It has licensed the use of the Nokia brand on handsets for 10 years, but the Finnish business will retain ownership of the brand. That will probably mean that the Nokia brand disappearing from handsets in the next decade, ending over 30 years ' history in the business.
Having started in 1865 with a pulp mill in the Finnish town of Tampere, Nokia reinvented itself repeatedly, shifting to rubber boot production early in the 20th century, and then making its first telephone exchange in the 1970s. Its first mobile phone appeared in 1981.
Rumours that Microsoft intended to buy Nokia had been floated since Elop joined the company. Reaction to the deal was mixed.
"Microsoft buying Nokia looks like doubling down on the current failing strategy, without changing the dynamics that are preventing success," cautioned Benedict Evans at Enders Analysis.
Ben Wood at CCS Insight described the deal as a "bold, but entirely necessary gamble by Microsoft".
"Mobile needs to be a
Feminism in the 1700’s, 1800’s, 1900’s and continues to be a highly discussed topic for all genders and races. A popular and important quote comes from Freedman(2002) “Feminism is a belief that women and men are inherently of equal worth. Because most societies privilege men as a group, social movements are necessary to achieve equality between women and men, with the understanding that gender always intersects with other social hierarchies (pg 7).” W.E.B DuBois argues for equal rights for all humans in his writing “The Damnation of Women”. While Anna Julia Cooper wants people to recognize male privilege in her late 19th century writing, “The Status of Women in America”. Mary
In contrast, Microsoft has been unable to innovate. The company relies on two cash cow products for its success, and has otherwise failed to capture even industries where it should be strong, like mobile operating systems. In contrast, Google was able to become the dominant player in this business despite having no prior experience in operating systems. Microsoft's failure to innovate has become a talking point in the industry and a threat to the company, should either of its top products be threatened by a new entrant to the market (Foley, 2010). As a result, the company's stock price today is only around the same place it was ten years ago (MSN
Microsoft is the most established software giant and Nokia is the company that is the icon for electronic and communication equipments. Microsoft had a partnership with the computer manufacturer IBM that made the software of Microsoft from DOS to modern Windows 8 famous and most used. The same underlying principle of symbiosis has been used inn this alliance. There are many reasons why Microsoft had to enter the cell phone industry. Arch Rival Apple came out with the iPhone and revolutionized the mobile world. Though the gadget was not a direct competitor, Microsoft was out of a huge potential market, namely the mobile segment.
Microsoft's struggles might seem somewhat perplexing, given its stunning success with Windows and the fact that it seems to have pursued a 'related linked' diversification strategy of primarily concentrating on products 'linked' to technology. It has not acquired businesses that are fundamentally anathema to its core product. "Companies' implements related diversification strategies in order to achieve and
An example of how the iceberg has come into play with the Microsoft - Nokia negotiation is that a key challenge of the deal was that Nokia was a huge source of Finnish pride and selling the brand’s best known division would hugely diminish that pride (Moen, 2011). This presented a challenge for Microsoft to overcome because Microsoft is an American company and America is a country that places less value on patriotism than Finland (Thompson, 2014). If Microsoft had undervalued Nokia’s Finnish routes and the importance of Finland to Nokia, then the Nokia board may not have agreed to sell the company to Microsoft. This is one of the reasons why Microsoft agreed to make Finland a research hub for the company and keep a significant portion of Microsoft’s mobile development work in that country. Having a company like Microsoft invest in Finland provided to be a large boon for the country and was one of the considerations of the deal. This deep sense of Finnish pride was also one of the reasons that Microsoft committed to keep using Nokia name even after the merger (Telegraph Reporters, 2016).
The Microsoft Corporation has lead people believe that they were attempting to gain monopoly power in the computer operating systems market. A monopoly market structure consists of having one firm that has control of the resources and market by selling a unique good that has no available substitutes, in which; make it very difficult for others to enter into this market. In America, we enjoy a free market rather than monopolies because monopolies create disadvantages to our society. However, having monopolistic power in a market is not necessarily bad, in some cases, monopolies are tolerated. There is reason to believe that Microsoft was trying to gain
From Nokia’s vision and mission statement it can be inferred that Nokia wants to be known for its credibility and to be a market leader again as it was before the year 2007 (Kess, 2014). Nokia understands that the company has to use innovation to offer products that are not yet
In 2013 Microsoft has announced a € 5.44 billion acquisition of Nokia’s hardware and services, including mobile phones, equivalent $ 7.2 billion. The deal was completed in the first half of 2014 and was supported by Nokia shareholders. Nokia's human resources operations in 50 countries around the world were available to Microsoft. There were also some factories with design, development, production, marketing and sales of smart devices, universal phones and services
Nokia’s current CEO Steven Elop admitted that Nokia was not able to respond fast enough to the changing market and that had resulted in significant decline in its market share. The technology moves very quickly and it is difficult to predict market trends.
EV: Generally, the threat of substitutes is low in the smartphone industry as there are not definite products that can readily substitute the smartphone. Consumers rely heavily on Smartphone and would not be able to find a close substitute that has all the function of a mobile phone. Furthermore, Nokia is a long and established company with many loyal customers. These people may continue to stay faithful to Nokia and are hence less resistant to change. Also, the perceived level of product
Nokia’s aggressive strategy to dominate mobile communication cluster would be the main reason how Nokia could become a world leader in the sector among other reasons. Nokia’s passion for mobile communication industry was great enough to give up more than 40% of its revenue in is pre-owned communication industry to concentrate only in mobile communications. Nokia was also lucky enough to see the possibility of mobile communication early enough to predominate the industry and prevent any competition from
Nokia failed to seize and transform the opportunity to dominate the smartphone era due to top management team homogeneity which led to identity trap and made them unable to adapt to changing environment from the period of 2006 to 2013 and was sold off to Microsoft by 2014.
We can see thanks to the S.W.O.T.T that Nokia has different strength especially the brand name, the experience, it is the founder of the mobile, but also its level of research and development, the quality of the workforce and of the device. But Nokia was not able to use this strength efficiently in the mobile market.
* Nokia Corporation has 132,430 employees working worldwide in 120 countries which is also a strong resource that ensures that the company will succeed in achieving its strategic goals.
Since NOKIA was the market leader in the mobile phone sector, NOKIA was in the strong position. So bargaining power of suppliers is less