Microsoft Mobile

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Microsoft Mobile Oy
Osakeyhtiö
(Limited company)
Industry Telecommunications equipment
Predecessor Nokia Devices and Services division
Founded Keilaniemi, Espoo, Finland (25 April 2014)
Headquarters Espoo, Finland
Area served
Worldwide
Key people
Stephen Elop
Jo Harlow
Products Mobile Phones
Smartphones
Tablets
Mobile software
Parent Microsoft Corporation
Website Microsoft Mobile Devices

Microsoft Mobile Oy is a multinational mobile phone and mobile computing device manufacturing company headquartered in Espoo, Finland, and a wholly owned subsidiary of Microsoft. Its principal activity is the design, development, manufacture and distribution of mobile phones, smartphones, tablet computers and related accessories.

Microsoft Mobile was established following the acquisition of Nokia's Devices and Services division by Microsoft, which was completed in April 2014. While Microsoft retains a limited license to use the Nokia name and logo on feature phones, the company was only granted a transitional license to the Nokia brand name.

Microsoft Mobile got the right to sell mobile phones under the Nokia brand name as part of a 10-year licensing agreement, as long as those phones are based on the S30+ which comprises feature phones. Future "Lumia" smartphones fell out of this license and couldn't be released bearing the Nokia brand;[1] [2] In October 2014, it was announced that future Lumia devices would carry the Microsoft name and logo instead of Nokia.[3]

Microsoft Mobile is Microsoft's second venture in the mobile phone hardware business, following the short-lived Kin in 2010.

History[edit]

With the acquisition of Nokia's devices and services division, Microsoft re-entered the smartphone market after its previous attempt, Microsoft Kin, a result of their acquisition of Danger Inc., was poorly-received.[4][5]

2011: Alliance with Nokia, Windows Phone, and the launch of Lumia[edit]

In February 2011, Stephen Elop and Microsoft's CEO Steve Ballmer jointly announced a major business partnership between the two companies, which would see Nokia adopt Windows Phone as its primary platform on future smartphones, replacing both Symbian and MeeGo. The deal also included the use of Bing as the search engine on Nokia devices, and the integration of Nokia Maps into Microsoft's own mapping services.[6] Nokia announced that it would still release one device running the MeeGo platform in 2011, but that it would devote fewer resources to future development of the platform, and that it would phase out Symbian entirely.[6] Aligning with Microsoft had been considered a possibility by analysts due to Elop's prior employment with the company.[7][8][9] Nokia unveiled its first Windows Phone 7-based devices, the mid-range Lumia 710 and high-end Lumia 800, on 26 October 2011 at its Nokia World conference.[10][11]

After this announcement, Nokia's share price fell about 14%, its biggest drop since July 2009.[12] Nokia's smartphone sales, which had previously increased, collapsed.[13] From the beginning of 2011 until 2013, Nokia fell from #1 to #10 in smartphone sales.[14] Amid falling sales, Nokia posted a loss of 368 million euros for Q2 2011, while in Q2 2010 realized a profit of 227 million euros. On September 2011, Nokia has announced it will end another 3,500 jobs worldwide, including the closure of its Cluj factory in Romania.[15]

As Nokia was the largest mobile phone and smartphone manufacturer worldwide at the time,[16] it was suggested the alliance would help Windows Phone.[9] Nokia was overtaken by Apple as the world's biggest smartphone maker by volume in June 2011.[17] [18] In August 2011 Chris Weber, head of Nokia's subsidiary in the U.S., stated "The reality is if we are not successful with Windows Phone, it doesn't matter what we do (elsewhere)." He further added "North America is a priority for Nokia (...) because it is a key market for Microsoft.".[19]

Nokia reported "well above 1 million" sales for its Lumia line up to 26 January 2012,[20][21] 2 million sales for the first quarter of 2012,[22] and 4 million for the second quarter of 2012.[23] In this quarter, Nokia only sold 600,000 smartphones (Symbian and Windows Phone 7) in North America.[24] For comparison, Nokia sold more than 30 million Symbian devices world-wide in Q4 2010[25] and the Nokia N8 alone sold almost 4 million in its first quarter. In Q2 2012, 26 million iPhones and 105 million Android phones shipped, compared to only 6.8 million devices with Symbian and 5.4 million with Windows Phone.[26]

While announcing an alliance with Groupon, Elop declared "The competition... is not with other device manufacturers, it's with Google."[27]

In June 2012, Nokia chairman Risto Siilasmaa told journalists that Nokia had a contingency plan in the event that Windows Phone failed, but did not specify what it was.[28][29]

2012: Financial difficulties[edit]

Market share of Symbian, Windows Mobile and Windows Phone 7 among US smartphone owners from Q1 2011 to Q2 2012 according to Nielsen Company.

On 8 February 2012, Nokia Corp. announced 4,000 layoffs at smartphone manufacturing plants in Europe by the end of 2012 to move assembly closer to component suppliers in Asia.[30]

On 14 June 2012, Nokia announced 10,000 layoffs globally by the end of 2013[31] and shut production and research sites in Finland, Germany and Canada in line with continuing losses and the stock price falling to its lowest point since 1996.[32]

In total, Nokia laid off 24,500 employees by the end of 2013.[33]

On 18 June 2012, Moody's downgraded Nokia's bond rating to junk.[34] Nokia CEO admitted that the company's inability to foresee rapid changes in the mobile phone industry was one of the major reasons for the problems.[35]

On 4 May 2012, a group of Nokia investors filed a class action against the company as a result of disappointing sales.[36] On 22 August 2012, it was reported that a group of Finnish Nokia investors were considering gathering signatures for the removal of Elop as CEO.[37]

In December 2012, Nokia announced that it would be selling its headquarters Nokia House for €170 million, and leasing it back in the long-term. This decision was taken to slash costs as the company was during a financial crisis of falling revenues.[38]

2013: New products and lack of profits[edit]

In January 2013, Nokia reported 6.6 million smartphone sales for Q4 2012 consisting of 2.2 million Symbian and 4.4 million sales of Lumia devices (Windows Phone 7 and 8).[39] In North America, only 700,000 mobile phones have been sold including smartphones.

In May 2013 Nokia released the Asha platform for its low-end borderline smartphone devices. The Verge commented that this may be a recognition on the part of Nokia that they are unable to move Windows Phone into the bottom end of smartphone devices fast enough and may be "hedging their commitment" to the Windows Phone platform.[40]

In the same month, Nokia announced its partnership with the world's largest cellular operator China Mobile to offer Nokia's new Windows-based phone, the Lumia 920, as Lumia 920T, an exclusive Chinese variant. The partnership was a bid by Nokia to connect with China Mobile's 700 million-person customer base.[41]

Following the second quarter of 2013, Nokia made an operating loss of €115m (£98.8m), with revenues falling 24% to €5.7bn, despite sales figures for the Lumia exceeding those of BlackBerry's handsets during the same period. Over the nine-quarters prior to the second quarter of 2013, Nokia sustained €4.1 billion worth of operating losses. The company experienced particular problems in both China and the U.S.; in the former, Nokia's handset revenues are the lowest since 2002, while in the U.S., Francisco Jeronimo, analyst for research company IDC, stated: "Nokia continues to show no signs of recovery in the US market. High investments, high expectations, low results."[42]

In July 2013, Nokia announced that Lumia sales were 7.4 million for the second quarter of the year – a record high.[43]

2013: Acquisition of Nokia's mobile phone business[edit]

On 2 September 2013, Microsoft announced that it would acquire Nokia's mobile device business in a deal worth €3.79bn, along with another €1.65bn to license Nokia's portfolio of patents for 10 years; a deal totaling at over €5.4bn. Steve Ballmer considered the purchase to be a "bold step into the future" for both companies, primarily as a result of its recent collaboration. It was also part of Ballmer's long-term vision of transforming Microsoft into a 'devices and services' company. Pending regulatory approval, the acquisition was originally expected to close in early 2014.

In an interview with Helsingin Sanomat, former Nokia executive Anssi Vanjoki commented that the Microsoft deal was "inevitable" due to the "failed strategy" of Stephen Elop.[44]

In March 2014, it was announced that the acquisition of Nokia's mobile phone business would not be completed by the end of March as expected, but instead was delayed until April of that year due to problems with regulators in Asia.[45] The acquisition of Nokia's mobile phones business by Microsoft was closed on 25 April 2014 for "slightly more" than the originally stated €5.44 billion.[46] Nokia's mobile phone assets became a part of Microsoft Mobile, a new subsidiary of Microsoft based in Finland.[47][48]

While Microsoft licensed the Nokia brand under a 10-year agreement, Nokia agreed not to use its name on smartphones and will be subject to a non-compete clause preventing it from producing any mobile devices under the Nokia name through 31 December 2015. Microsoft acquired the Asha and Lumia brands as part of the deal, and are also licensing the Nokia brand from Nokia.[49]

As part of the deal, a number of Nokia executives joined Microsoft. Stephen Elop became the head of Microsoft's devices team (which include products such as Xbox and Surface); Risto Siilasmaa replaced Elop as interim CEO, before the appointment of Rajeev Suri.[50][51][52][53]

On 17 July 2014, it was reported that a major round of layoffs, a total of over 18,000 across the entire company, would occur at Microsoft over the next year. The majority of this layoffs will be in relation to the integration of Nokia's former staff into Microsoft, in an effort to reduce redundancy. It was also reported that Microsoft had ended future development of Nokia's feature phone and X lines in favor of focusing exclusively on Windows Phone.[54][55]

2014: Post-acquisition[edit]

Microsoft Lumia 535, the first Microsoft branded Lumia device

Even after the acquisition of Nokia's mobile device business by Microsoft, several Lumia devices were unveiled by Microsoft Mobile in September 2014 that still carried the Nokia name, including the Lumia 830 and Lumia 735;[56] In July 2014, it had been reported by evleaks that Microsoft was attempting to license the Nokia name in a co-branding scheme, which would have possibly seen future devices branded as "Nokia by Microsoft".[57][58][59] As a part of the change of ownership the social network pages have also been rebranded as Microsoft Lumia[60][61] rather than Microsoft Mobile to emphasize their focus on Windows Phone as opposed to other Nokia mobile phones while also changing their social network pages of Windows Phone to the new Microsoft Lumia branding,[62] to reflect this change Nokia Conversations has also been rebranded as Lumia Conversations,[63] and NokNok.tv to Lumia Conversations UK.[64] Though the rebranding has not been consistent as the Nokia Army has been renamed the Spartan Nation and the support site for legacy phones, accessories, as well as other Nokia-branded devices and services Nokia Discussions has been renamed the Microsoft Mobile Community.[65]

In September 2014, Microsoft announced Windows 10 operating system, a common platform for smartphones, tablets, laptops and Xbox. It will be made available for their Lumia line of smartphones. [66] Windows 10 is expected to be available in late 2015.

In October 2014, Microsoft announced that future Lumia devices would be branded with the Microsoft name and logo rather than Nokia.[67] In November 2014, Microsoft announced its first self branded phone, Microsoft Lumia 535. [68]


Services[edit]

When Microsoft bought Nokia's devices and services division they inherited a number of services that largely overlapped with Microsoft's own services, since then they have gradually merged some with their own services, renamed others with "Lumia" branding,[69] and have discontinued a small number such as the Nokia Sync service,[70] as well as sold the MixRadio music service. Nokia accounts have been replaced by Microsoft accounts in most of these services,[71] and the "Nokia" brand has been removed from their names.

Current services[edit]

Lumia Beta Apps[edit]

Main article: Nokia Beta Labs

Lumia Beta Apps (previously the Nokia Beta Labs)[72] facilitates beta applications being developed by Microsoft or select 3rd party developers for Lumia products. The applications are:

  • Of reasonably good quality, but may have rough edges and occasional service breaks;
  • Not commercialized yet, not guaranteed, and not officially supported;
  • Under active development;
  • Free of charge;
  • Not be used for commercial purposes

Applications may graduate to become commercial offerings, or they will be archived along with the lessons learnt based on user feedback. Microsoft collects feedback through UserVoice and has since launched several new applications such as Cinemagraph Beta and Gestures.[73] Originally the site was operated by Nokia but Microsoft moved the development to a more feedback-orientated design in August 2014 to allow more users to add their feedback rather than just Nokia-developers.[74] So far Microsoft has discontinued the Nokia Camera Beta trial and re-released the Beta app as "Lumia Camera Classic" while implementing the new features in the Lumia Camera app,[75] and has added OneDrive integration to Lumia Cinemagraph (formerly Nokia Cinemagraph) after first trialing it in the Lumia Beta Apps site.[76] On the 25th of February 2015 Join Conference (previously Nokia Conference) was made public for all Windows Phones but republished under the Microsoft Garage and reduced the number of markets it was available in.[77][78]

Lumia Conversations[edit]

Lumia Conversations (formerly Nokia Conversations) and Lumia Conversations UK (formerly NokNok.TV) are news blogs by Microsoft that deliver the latest information about Lumia phones, Windows Phone applications and corporate life at Microsoft while also offering news about other Microsoft services and Nokia branded feature phones.[79][80]

Former services[edit]

Nokia Store[edit]

The Nokia Store (formerly the Ovi Store) is the application store for the Nokia Asha Platform and the Nokia X platform; customers can download mobile games, applications, videos, images, and ringing tones to their Asha and X devices, the store also lists Symbian and MeeGo applications, though developers can no longer launch nor update them. In January 2015 Microsoft announced that they'll encourage developers to migrate their apps to the Opera Mobile Store and Microsoft will officially close down the Nokia Store on the 31st of March 2015.[81] Microsoft officially stopped accepting new applications to the Nokia Publish service and new registrations to the Nokia Publish and Nokia Developer websites since the 18th of February 2015,[82] and will officially retire the Nokia Developer site in March 2015 and encourages developers to go to the MSDN and Windows Developer site to develop applications for Windows Phone and Windows.[83]

Nokia Messaging[edit]

On 13 August 2008 Nokia launched a beta release of "Nokia Email service", a push e-mail service, later incorporated into Nokia Messaging subsequently renamed to Microsoft Mobile Messaging.[84]

Microsoft Mobile Messaging operates as a centralized, hosted service that acts as a proxy between the Messaging client and the user's e-mail server. The phone does not connect directly to the e-mail server, but instead sends e-mail credentials to Microsoft's servers.[85] Microsoft discontinued the service for Microsoft Lumia devices and advised its users to migrate to Microsoft Skype.[86] Microsoft will officially shut down the service alongside Nokia Mail on the 9th of March 2015 and Nokia accounts on April 19 in favour of Microsoft's own instant messaging service, Skype and Microsoft's own e-mailing service, Outlook.com.[87][88]

MixRadio[edit]

Main article: MixRadio

MixRadio (formerly Nokia MixRadio, Nokia Music Store, and OVI Music Store) is a music service that was launched as Nokia Ovi Store on 29 August 2007 by Nokia. MixRadio allows free streaming of playlists without any subscriptions or ads available in 31 countries, including the US, Brazil, India and China. Microsoft sold the service off to the LINE Corporation in 2015.[89]

Devices[edit]

Microsoft will license the Nokia name under a 10-year agreement, the company will only be able to use it on feature phones specifically phones running the Series 30, and Series 30+[90] mobile operating systems based on Java ME and MediaTek technology,[91] respectively.[92][93] These changes resulted in future Lumia models being first-party hardware produced by Microsoft.[49][94]

Current hardware lines[edit]

Lumia[edit]

Main article: Microsoft Lumia

The Lumia is a line of touchscreen smartphones and tablet computers, introduced in November 2011. They all run on the Windows Phone operating system. It was originally a smartphone line until the introduction of the Lumia 2520 in November 2013, which extended the line into tablets. The Lumia is Microsoft's flagship portfolio.[95][96]

In October 2014, Microsoft officially announced that it would phase out the Nokia brand in its promotion and production of Lumia smartphones, and that future Lumia models will be branded solely with the name and logo of Microsoft.[97][98][99][100] In November 2014, Microsoft announced its first self branded phone, Microsoft Lumia 535.[101][102][103] Rebranding the Lumia line from "Nokia" to "Microsoft" did not affect sales though some critics believed that the change of branding might influence consumers' decisions due to the established brand of Nokia which has built up a reputation of durability while the Microsoft brand is relatively new in the consumer phone space.[104][105]

In February 2015 Microsoft launched the official technical preview of Windows 10 on these Lumia devices, Nokia Lumia 630, Nokia Lumia 635, Nokia Lumia 636, Nokia Lumia 638, Nokia Lumia 730, and the Nokia Lumia 830 and would gradually add other models as the preview would progress.[106] Microsoft stated that most Lumia devices will be able to upgrade from Windows Phone 8.1 to Windows 10. In February 2015, Joe Belfiore stated that Microsoft was "working on" a version of 10 for low-end devices with 512 MB of RAM, specifically citing the Nokia Lumia 520—a model which represents 23.8% of all Windows Phone devices sold, but reaffirmed that not all of its features would be supported on these devices.[107]

Series 30 and Series 30+[edit]

Main articles: Series 30 and Series 30+
The Nokia 130, which runs on the Series 30+ platform.

These devices are low-end feature phones. They have T9 keypads and do not feature touchscreens. After superseding higher end feature phones running Series 40 and the Asha Platform with Windows Phones, Microsoft continues to produce Series 30 and Series 30+ based feature phones, the first addition being the Nokia 130.[108][109] Unlike the Nokia 225 announced earlier in 2014, the Nokia 130 doesn't connect to the internet, which means no Bing, Outlook, or other apps, though it does offer basic feature phone applications such as a flashlight, FM radio, USB charging, and a playback for video stored on microSD cards up to 32GB, and Bluetooth and USB for sharing content between devices. These devices are aimed at first-time mobile phone users.[110] While the Nokia 130 does not have any internet access, the Nokia 215 released in 2014 allows users to browse the internet with Bing and MSN Weather and came pre-installed with Opera Mini.[111]

Former hardware lines[edit]

Asha[edit]

Main article: Nokia Asha

The Asha series contain feature phones and low-end smartphones, mainly targeted at emerging markets. It is a mixture of full-touchscreen, "touch and type", QWERTY, and traditional T9-keypad devices. Originally the Asha devices ran on Nokia's veteran operating system Series 40. Nokia later created the Asha platform as a result of their acquisition of Smarterphone. The Asha 501 in May 2013 was the first device running the new OS, and all new Ashas since are powered by the new Asha platform.[112] During the July 2014 job cuts and restructuring at Microsoft, these device lines were moved to "maintenance mode", and will be discontinued alongside Nokia X and Series 40[113] in favour of solely producing Windows Phone and Nokia "feature phone" products.[55]

Nokia X[edit]

Main article: Nokia X family

A media report revealed in mid-September 2013 that Nokia tested the Android operating system on both its Lumia and Asha hardware.[114] However, a new report on 11 December 2013 showed the Asha-like device, codenamed 'Normandy' for the first time, stating that despite the finalisation of the acquisition, development of the device is continuing.[115]

The Nokia X

The Nokia X family was unveiled at Mobile World Congress in February 2014 in Barcelona, Spain. These devices, which are aimed towards emerging markets, run a modified version of Android known as Nokia X Software Platform, which is aligned towards Microsoft services and does not use Google Play Store. In a company memo released in July 2014, it was announced that as part of cutbacks, Microsoft would end the Asha, Series 40, and X range entirely, in favor of solely producing and encouraging the use of Windows Phone products.[55]

Series 40[edit]

Main article: Series 40

Series 40, often shortened as S40, is a software platform and application user interface (UI) software on Nokia's broad range of mid-tier feature phones, as well as on some of the Vertu line of luxury phones. It was one of the world's most widely used mobile phone platforms and found in hundreds of millions of devices.[116] Nokia announced on 25 January 2012 that the company has sold over 1.5 billion Series 40 devices.[117] S40 has more features than the Series 30 platform, which is more basic. They are not used for smartphones, in which Nokia primarily uses Windows Phone, and up until 2012 Symbian. However, in 2012 and 2013, several Series 40 phones from the Asha line, such as the 308, 309 and 311, have been advertised as "smartphones" although they do not actually support smartphone features like multitasking or a fully fledged HTML browser.[118] During July 2014, it was announced that Microsoft would end the Asha, Series 40, and X range entirely, in favor of solely producing and encouraging the use of Windows Phone products.[55]

Corporate affairs[edit]

Headquarters[edit]

Main article: Microsoft Talo
Microsoft Talo - Aerial view

The Microsoft Talo is the head office building of Microsoft Mobile (formerly part of the Nokia Corporation), located in Keilaniemi, Espoo, just outside Helsinki, the capital of Finland.

The building was previously named The Nokia House. The two most southern parts of the building were built in the early 1990s and the third most northern part was built in 2000. Around 5000 employees work in the premises.

On December 2012, Nokia announced that it has sold its head office building to Finland based Exilion for €170 million and leasing it on a long term basis.[119]

After the completion of Microsoft's acquisition of Nokia's device business in April 2014, the building received its new name: Microsoft Talo. [120][121]

See also[edit]

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External links[edit]