Rumour: Microsoft To Buy Nokia’s Handset Unit

Hot on the heels of the news about Nokia showing ditching Ovi as a brand, here is some more news for all you Tech junkies.

Eldar Murtazin, Editor of Mobile Review who had predicted the Nokia-Microsoft Windows Phone deal back in December 2010 has come up with a new post on his personal blog firing up a new rumour. According to this post Microsoft will buy Nokia’s handset manufacturing unit by the end of 2011.


If this rumour turns out to be true it would put Microsoft in the league of companies like Apple and Blackberry who completely control the whole experience of their phones, hardware as well as software. Along with Xbox and Kinnect, Microsoft will add phones to its hardware division. This would mean better software updates for Windows Phones more control of Microsoft over their devices and all of this leading to a better and consistent experience for the end user. If this goes through Microsoft would end up paying as much as $30 billion easily surpassing the $8.5 billion it paid for skype. Microsoft having control over Windows Phone, Nokia and Skype would lead to an enhanced experience where skype would be deeply integrated into Windows Phone thus giving consumers a reason to choose Windows Phone.

It is also important to note that Stephen Elop, the CEO of Nokia who previously worked at Microsoft is said to be the Redmond giant’s insider at Nokia. The Nokia-Microsoft deal happened under him just a few days after his widely popular albeit confidential burning platform internal memo.

In an internal memo from Steve Ballmer to Microsoft employees on the Skype acquisition, the CEO wrote the following

We are ambitious and forward looking. We have big goals and aspirations. And when we look into the world and see opportunities to do more with technology, we’ll drive toward them and keep pushing. Sometimes we’ll build ourselves, as we’ve done most recently with Bing and Kinect. Sometimes we’ll partner or form an alliance to seize the moment, as we’ve done with Yahoo! and Nokia. And other times we’ll make an acquisition, as we’ve announced today–one that plays to both company’s strengths and opens new opportunities not available otherwise.

Exciting times!

In the post PC age Microsoft is desperately looking for areas to expand in as reflected in the memo above. The most profitable areas of Microsoft are still the same as they were a decade ago, Windows and Office. Microsoft needs to drive innovation and this acquisition maybe a step for the same. An acquisition like this would also mark Microsoft’s move from a largely PC based company to a diverse one.

Even though Eldar Murtazin has enjoyed a good history with Nokia rumours (he predicted the CEO change, the move from Symbian to Windows phone  and recently the dumping of the ‘Ovi’ brand) there seems to be a lot of doubt about how true these rumours are. Mark Squires, communication director at Nokia had the following to say through Twitter

We typically don’t comment on rumors. But we have to say that Eldar’s rumors are getting obviously less accurate with every passing moment.

We will have to see in the coming months whether these rumours are true or not, but if they are, it would be completely in line with Microsoft’s strategy of expansion.

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