Microsoft takes control of Nokia's phone business; acquires 25,000 new employees

Yesterday, Nokia's devices and services business; today, Microsoft Mobile Oy. Microsoft now owns three phone platforms, a tablet and 25,000 new employees.
Written by Mary Jo Foley, Senior Contributing Editor

It's official as of today, April 25: Nokia's Devices and Services business is now owned by Microsoft.


Microsoft Mobile Oy is now the subsidiary of Microsoft responsible for Lumia, Asha and Android-based Nokia X phones, and other unspecified devices. The new name and status is the culmination of Microsoft's acquisition of Nokia's handset business, which cost Redmond $5 billion (plus another $2 billion for a 10-year associated patent-licensing agreement).

Microsoft Mobile Oy is now part of the Microsoft Devices Group headed by Executive Vice President Stephen Elop. The Mobile Devices Group is now responsible for Lumia smartphones and tablets, Nokia mobile phones, Xbox hardware, Surface, Perceptive Pixel (PPI) products, and accessories.

Under the patent piece of the deal, Microsoft acquired 8,500 design patents covering phone manufacturing from Nokia. Microsoft is also licensing another 30,000 "utility" patents from Nokia for ten years, with the option to renew in perpetuity.

Microsoft isn't making any further branding announcements at this point, so this doesn't necessarily mean that any future phones or tablets will be branded "Microsoft Mobile." Microsoft licensed the rights to the Nokia brand for existing phones when it announced plans for the acquisition last fall; it also bought outright the Asha and Lumia brands.

As a result of the Nokia acquisition, Microsoft also is acquiring approximately 25,000 new employees located in 50 countries, plus several factories that design and manufacture devices. Back in September, Microsoft was expecting to acquire 32,000 employees.) The two factories that are not part of the acquisition are one in South Korea (which Microsoft acknowledged earlier this week), plus one in Chennai, India. (Nokia is involved in a tax dispute with the Indian government over the Chennai plant, and will continue operating that 7,500-employee operation on behalf of Microsoft for the time being.)

As of today, April 25, 2014, Microsoft is the company that will be handling all existing Nokia customer warranties for existing devices.

Elop will be holding a worldwide "Ask Me Anything" on the Conversations blog on April 28 at 1 pm GMT/9 am ET. The session will be recorded for later viewing.

Nokia -- the non-handset company -- is continuing to operate. It is now a three-piece operation , with a networking unit, mapping business and a patent and research arm.

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