Another day, another million-dollar or billion-dollar deal. At least that's how this week seemed, and it's not even over yet.
Verizon Communications' $130 purchase of Vodafone's 45 percent stake in Verizon Wireless and Microsoft's decision to pay around $7.2 billion for Nokia's handset business were done for both strategic reasons and financial ones. And, as The Verge notes, the financial ones had a lot to do with fears about rising interest rates.
Microsoft's decision to pay around $7.2 billion for Nokia's handset business could put pressure on some of its other major OEM partners, such as Samsung Electronics and HTC, analysts said.
When Nokia completes the $7.2 billion sale of its struggling handset business to Microsoft in Q1 2014, its Nokia Siemens Networks (NSN) subsidiary will be able focus its attention on selling wireless infrastructure and emerging cloud-based service opportunities.
Nokia could pursue Android phone manufacturers over royalty payments once the deal to sell its devices and services unit to Microsoft has closed, as the Finnish company will retain ownership of its valuable mobile patent portfolio.
The "new Nokia" that will be left after Microsoft takes over the iconic handset maker's devices and services unit will be an infrastructure vendor and patent licensor with a growing presence in the cloud and network virtualization.
Microsoft CEO Steve Ballmer admitted that Nokia's Stephen Elop, a former Microsoft executive, is a candidate to replace him as CEO as he looks to step down sometime in the next 12 months.
Microsoft decision pay around $7.2 billion for Nokia's devices and services unit and a license to its patents and mapping software is being cast by analysts as a bold but risky bet that could leave the two companies more isolated in mobile than they were before the deal.
Can Microsoft save Nokia's smartphone business by buying it? I'm not sure it can. If history is any indicator, it's clear that even when the strongest companies acquire weaker ones, it doesn't spell instantaneous success. Microsoft's purchase of Nokia's handset business is not the first of this type of deal. Over the past few years there have been similar tie-ups between software and hardware companies. With that in mind, I've compiled a rundown of some of these past deals and looked at whether they have paid off for the purchaser and the acquired company.
After all the rumours, speculation and counter-rumours, it has finally come to pass: Nokia is selling its devices and services business to Microsoft for €5.44 billion and will focus on network equipment, mapping and location technology and licensing in future. For Finns, the sale is emotional and marks a new chapter in almost 150 years of Nokia history.