Nokia Jumps Back into Device Business with 10-year License Agreement

It has granted HMD Global an exclusive, 10-year license to the famous brand, allowing the Finnish startup to sell Nokia mobile phones and tablets. After that, HMD expects to become the sole global licensee for all devices carrying the Nokia brand. The agreement covers both brand and intellectual property rights, Nokia said. Former HTC and Nokia executive Florian Seiche, who is now Microsoft's vice president of sales across Europe, will become HMD's president.

Analysts and consumers have been waiting with bated breath to see if Nokia will return to the production of smartphones and tablets. "Working with HMD and FIH will let us participate in one of the largest consumer electronics markets in the world while staying true to our licensing business model".

The Finnish brand - once the biggest name in mobile phone technology and worth $300 billion in its pomp - has been sold by Microsoft for just $350m. The deal sees Microsoft handing over the rights to use the brand name of Nokia, feature phone software, supply agreements and other contracts.

The move by the Foxconn Group to take up control of two global technology brands, Sharp and Nokia, in less than two months has raised concerns that the EMS/OEM giant will eventually transform itself into a brand operator - a title which Foxconn has long dreamed for but has to deny.

Former Nokia manager Arto Nummela, the current head of Microsoft's mobile devices business for Asia, Middle East and Africa, and its feature-phone business, will head the new venture.

The transaction is expected to close in the second half of this year.

According to Nokia, HMD's new smartphone and tablet portfolio will be based on the Android operating system.

Foxconn previously claimed that its spending of over NT$110 billion (US$3.356 billion) to acquire a 60% stake in Sharp is purely an investment project rather than an acquisition deal and that Sharp will continue to keep its brand and operate independently.

In its April quarterly financial report, Microsoft said its mobile phone sales were weak, with a drop in Windows Phone purchases and a high inventory of unsold Lumia smartphones. "We will work with world class providers in manufacturing and distribution to move quickly and deliver what customers want". And in a press release, the company has confirmed that it would.

Source: Nokia Jumps Back into Device Business with 10-year License Agreement