The Nokia name is returning to the worldwide mobile devices market, through a new Finnish company called HMD Global.
When Nokia sold its mobile phone business to Microsoft a few years back, the U.S.-based company bought the rights to the Nokia brand on feature phones for a decade, and on smartphones for 30 months.
This means Nokia now has control over its brand on smartphones again, and it said on Wednesday that it will grant HMD an exclusive global licence to make Nokia-branded handsets and tablets for the next decade. HMD will also pay Nokia royalties for its cellular standard essential patent licences.
As part of the arrangement, Microsoft is selling HMD the right to use the Nokia brand on feature phones. It is also selling the manufacturing, sales and distribution parts of its feature-phone business to FIH Mobile, a subsidiary of the manufacturing giant Foxconn. This includes manufacturing facilities in Vietnam.
Foxconn, HMD and Nokia will all work together in the future, as they try to make Nokia a powerhouse name in the world of mobile again.
Nokia will have a seat on HMD's board and set branding requirements for the new products.
"Today marks the beginning of an exciting new chapter for the Nokia brand in an industry where Nokia remains a truly iconic name. Instead of Nokia returning to manufacturing mobile phones itself, HMD plans to produce mobile phones and tablets that can leverage and grow the value of the Nokia brand in global markets," said Ramzi Haidamus, the president of Nokia Technologies.
The CEO-designate of HMD is Arto Nummela, formerly a Nokia executive and most recently Microsoft's vice-president of sales and marketing for Greater Asia, the Middle East and Africa.
"Branding has become a critical differentiator in mobile phones, which is why our business model is centred on the unique asset of the Nokia brand and our extensive experience in sales and marketing," Nummela said. "We will work with world class providers in manufacturing and distribution to move quickly and deliver what customers want."
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