Report: Nokia could re-enter handset market via brand licensing next year

Nokia (NYSE:NOK) is preparing to jump back into the handset market as soon as next year, likely via licensing its brand and technologies, according to a Re/code report. [click to tweet]

The report, citing unmade sources, said the company also plans to explore other technologies including virtual reality. 

Nokia sold its handset business to Microsoft (NASDAQ: MSFT) in April 2014 but still holds onto more than 10,000 patents, many related to mobile phone technologies. Indeed, Nokia has already made forays into handsets since the Microsoft deal. It currently offers the Z Launcher app on the Google Play app store that lets users scribble a letter or two to find their content more quickly. Over time, Nokia has said, the Z Launcher learns what applications are in use, and predicts and highlights the applications consumers are expected to want based on time of day and location.

Nokia also sells an Android tablet called the N1, which is manufactured, distributed and sold by Foxconn. The N1 includes the Z Launcher.

According to Re/code, Nokia's return to handsets is likely going to follow a similar path it took with the N1 of licensing its technology and brand. A Nokia spokesman declined to comment.

The report indicates that even though Nokia wants to focus more on network technologies and equipment, as demonstrated by its $16.6 billion deal to purchase Alcatel-Lucent (NYSE: ALU), the company is not giving up on licensing. Nokia has also said it has started a review of its strategic options, including a potential sale of its HERE mapping business, but confirmed last week that its technology incubation and patent-licensing unit is staying put.

Last week Nokia said that the licensing unit, Nokia Technologies "will stay as a separate entity with a clear focus on incubating new technologies and sharing those technologies through an active licensing program."

"They have a lot of great stuff in development," Richard Kerris, a former Nokia executive who also consulted for the company until last year, told Re/code. "It gave me complete confidence that Nokia is a company that is not going away." Kerris indicated that people "will be blown away" if some of the technologies he saw make it to market, according to the report.

Nokia's deal with Microsoft prevents the company from using the Nokia brand name on phones, but the company is clearing thinking about doing so when that provision expires. Sebastian Nyström, head of products at Nokia Technologies, told Reuters in November that the company is angling to get back into phones. "In 2016 we can again enter that business," he said. "It would be crazy not to look at that opportunity. Of course we will look at it."

Nokia Technologies hired former Dolby Labs executive Ramzi Haidamus as its president and last week hired longtime Cisco executive Guido Jouret to be its CTO. While Nokia could jump back into the smartphone market via licensing technology and its brand, it's unclear how committed the company would be to such efforts, especially if it will be up to other vendors to manufacture and sell new phones in a highly competitive market. 

For more:
- see this Re/code article

Related Articles:
Analysts: Nokia, Alcatel-Lucent likely to face integration challenges for years to come
U.S. wireless carriers to face fewer vendor options as Nokia moves to buy Alcatel-Lucent
Nokia, Alcatel-Lucent confirm talks to create world's largest wireless network gear vendor
Reports: Nokia could sell HERE mapping biz, might use funds for Alcatel-Lucent bid
Nokia CEO argues in favor of paid prioritization in net neutrality, introduces 'programmable world' concept
Nokia licenses brand and IP for Foxconn-made N1 Android tablet

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