Microsoft Pays US$ 7 Billion to Acquire Nokia
Microsoft is planning to purchase Nokia mobile smart phones business line in what might be a deal that will pit Microsoft against Google Android phones and Apple in the smart phone market. The acquisition is said to cost US$ 7.2 billion giving Microsoft control of the second largest mobile phone makers in the world.
Nokia is behind Samsung in phone sales and just ahead of Apple, but still Nokia is having trouble and is fast losing relevance. Nokia was once the dominant in the mobile phone sector but today can no longer crack the top five manufacturers in the world. although Nokia’s Lumia smart phones is growing fast, they are selling at such a low baseline which is irrelevant compared to Samsung Galaxy smart phones, the iPhone and even Google’s Moto X which created more buzz.
Based on market studies Apple and Google controls around 86 percent of the market and Microsoft Windows Phone only got 3.7 percent. Buying Nokia is a strategy for Microsoft that will greatly accelerate the company’s share and profits in the market and might strengthen opportunities for Microsoft and its partners.
Also buy purchasing Nokia, Microsoft gains access to a number of patents along with Nokia’s mapping services.