'Microsoft deal was our best alternative': Nokia chairman on his sleepless nights over the future
There may now be a Microsoft logo on its famous Espoo headquarters, but Nokia chairman Risto Siilasmaa can finally get a good night's rest. In an interview with Finnish broadcaster YLE, Siilasmaa opened up about his sleepless nights over the company's future and its renewed hopes for the future now the Microsoft deal is done.
"It was difficult to sleep a few months prior to [the deal] when I understood that the company's situation was such that something major had to be done," Siilasmaa said.
"What has now happened is actually the best solution of all the alternatives. I can't imagine any other realistic alternative where the company's future would look as bright as it does now.
"Nokia was in a situation where its chances of success in this [mobile phone] business were becoming increasingly small. If we had walked that path long, enough major changes would have occurred, irrespective of Nokia. A company that is running out of money and is making a loss is in a situation where others make decisions for it.
"As some analysts have described, the smartphone business is structurally unattractive at his time. We have moved on to a phase where two big players dominate the market with their strong ecosystems. Everyone else is making losses or breaking even at best. And there is no clear end in sight for this phase."
It's all change following the Microsoft deal. Siilasmaa highlighted that Nokia is now a profitable company with a strong balance sheet and that, from a market perspective, its business value has increased almost tenfold since the Microsoft deal and buying out Siemens' stake in its joint networking venture.
The former handset giant is now focusing on three business areas: its mapping unit Here; its infrastructure arm NSN; and its R&D unit Advanced Technologies.
Siilasmaa sees plenty of growth opportunities in each, but highlighted smart devices, especially development of smart cars, as the Internet of Things takes hold. He painted a picture of a future where not only garage doors open when we drive home or the music a driver plays in their car syncs with their home stereos, but also where self-driving cars can pick up people from their doorstep.
"We offer a wide range of products for companies building self-driving cars and services," he said. "We are developing these systems in cooperation with Mercedes, for example. It is a very interesting growth opportunity for us and we are investing significantly in it this year."
When asked whether he believes Nokia can grow back to be the pillar of Finnish economy it was in its glory days, Siilasmaa was hesitant to answer.
"For Finland's sake, my hope is that no company would rise to that kind of position," he said. "It would be better that we had many big, globally successful companies. But of course Nokia needs to have strong ambitions to grow."