Ten months after writing down much of its disastrous acquisition of Nokia’s handset business, Microsoft took another step to unwind the deal.
Microsoft on Wednesday agreed to unload its low-end phone business, acquired from Nokia, to FIH Mobile Ltd., a subsidiary of Hon Hai/Foxconn Technology Group, and HMD Global Oy for $US350 million. In a separate but related transaction, Nokia entered into licensing pacts with FIH Mobile and HMD Global to put its brand once again on mobile handsets.
The deal highlights how sharply Microsoft Chief Executive Satya Nadella has shifted the company’s mobile strategy since his predecessor, Steve Ballmer, championed the Nokia deal, which closed in 2014. Last summer, Microsoft wrote down about 80 per cent of the $US9.4 billion deal, cutting 7,800 workers, mostly in its mobile-phone business. The software giant hasn’t given up on phones. But its latest strategy revolves around Windows 10, the most recent version of its flagship operating system that runs on various devices including smartphones, PCs, tablets, and game consoles.
Microsoft also is developing services that behave intelligently based on data gathered by smartphones and other devices. At a conference for software developers in March, the company showed how its voice-activated digital assistant, Cortana, could book a hotel room or order a pizza proactively based on a user’s personal data and preferences.