Nokia set to return to Mobile market
Finnish telecommunications company Nokia is set to return to the mobile market. Nokia sold its Devices and Services business to Microsoft for 7.2B dollars in 2013 – kept its iconic brand, but was prohibited to use the brand on smartphones till the end of 2016.
In April 2016, a Finnish newly founded start-up called HMD Global entered a strategic partnership with Nokia that includes intellectual property and brand licensing. HMD will be the sole holder of the rights to use the Nokia brand on smartphones, tablets and futurephones. At the same time, Foxconn owned FIH Mobile bought from Microsoft Nokias feturephone division for 350 million dollars, together with the Hanoi manufacturing facility in Vietnam.
FIH Mobile and Foxconn will manufacture Nokia branded smartphones and tablets powerd by Android OS, and futurephones for HMD. HMD will design and distribute the final products. To ensure the quality of future Nokia branded products, Nokia will have one of the five seats at the HMD Board of Directors. HMD intends to invest over USD 500 million over the next three years for marketing of Nokia-branded mobile phones and tablets.
HMD will be led, once the Microsoft transaction closes, by Atro Nummela as CEO and the company is expected to start operating in the second half of 2016.
Press Release
Nokia
Nokia signs strategic brand and intellectual property licensing agreement enabling HMD global to create new generation of Nokia-branded mobile phones and tablets
Espoo, Finland – Nokia has announced plans that will see the Nokia brand return to the mobile phone and tablet markets on a global basis. Under a strategic agreement covering branding rights and intellectual property licensing, Nokia Technologies will grant HMD global Oy (HMD), a newly founded company based in Finland, an exclusive global license [1] to create Nokia-branded mobile phones and tablets for the next ten years. Under the agreement, Nokia Technologies will receive royalty payments from HMD for sales of Nokia-branded mobile products, covering both brand and intellectual property rights.
HMD has been founded to provide a focused, independent home for a full range of Nokia-branded feature phones, smartphones and tablets. To complete its portfolio of Nokia branding rights, HMD announced today that it has conditionally agreed to acquire from Microsoft the rights to use the Nokia brand on feature phones, and certain related design rights. The Microsoft transaction is expected to close in H2 2016. Together these agreements would make HMD the sole global licensee for all types of Nokia-branded mobile phones and tablets. HMD intends to invest over USD 500 million over the next three years to support the global marketing of Nokia-branded mobile phones and tablets, funded via its investors and profits from the acquired feature phone business.
Nokia-branded feature phones remain one of the most popular choices of mobile phone in many markets around the world today, and HMD will continue to market them as part of an integrated portfolio alongside a new range of smartphones and tablets. HMD’s new smartphone and tablet portfolio will be based on Android, uniting one of the world’s iconic mobile brands with the leading mobile operating system and app development community.
As also announced today by FIH Mobile Limited (FIH), a subsidiary of Hon Hai Precision Industries (trading as Foxconn Technology Group), the remainder of Microsoft’s feature phone business assets, including manufacturing, sales and distribution, would be acquired by FIH. HMD and Nokia Technologies have signed an agreement with FIH to establish a collaboration framework to support the building of a global business for Nokia-branded mobile phones and tablets. This agreement will give HMD full operational control of sales, marketing and distribution of Nokia-branded mobile phones and tablets, with exclusive access to the pre-eminent global sales and distribution network to be acquired from Microsoft by FIH, access to FIH’s world-leading device manufacturing, supply chain and engineering capabilities, and to its growing suite of proprietary mobile technologies and components.
Nokia will provide HMD with branding rights and cellular standard essential patent licenses in return for royalty payments, but will not be making a financial investment or holding equity in HMD. Nokia Technologies will take a seat on the Board of Directors of HMD and set mandatory brand requirements and performance related provisions to ensure that all Nokia-branded products exemplify consumer expectations of Nokia devices, including quality, design and consumer focused innovation.
HMD would be led, once the Microsoft transaction closes, by Arto Nummela as CEO, who previously held senior positions at Nokia and is currently the head of Microsoft’s Mobile Devices business for Greater Asia, Middle East and Africa, as well as Microsoft’s global Feature Phones business. HMD’s president on closing would be Florian Seiche, who is currently Senior Vice President for Europe Sales and Marketing at Microsoft Mobile, and previously held key roles at Nokia, HTC and other global brands.
Ramzi Haidamus, president of Nokia Technologies, said:
“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. 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.”Arto Nummela, CEO-designate of HMD, said:
“We will be completely focused on creating a unified range of Nokia-branded mobile phones and tablets, which we know will resonate with consumers. Branding has become a critical differentiator in mobile phones, which is why our business model is centered on the unique asset of the Nokia brand and our extensive experience in sales and marketing. We will work with world class providers in manufacturing and distribution to move quickly and deliver what customers want.”Vincent Tong, Chairman of FIH, added:
“We are looking forward to fostering a strong and long-term collaboration with HMD global and Nokia. We are impressed by the experience and expertise of the HMD management team and are committed to supporting them with our manufacturing, technology and supply chain capabilities, to capture market opportunities together in the future.”1 Excluding Japan
About Nokia Technologies
Nokia Technologies (TECH) is Nokia’s advanced technology and licensing business. Formed in 2014, TECH builds upon Nokia’s solid foundation of industry-leading licensing and technology R&D capabilities. By focusing on Digital Health, Digital Media, Brand Licensing, and Patent Licensing, TECH is expanding the human possibilities of the ever-evolving world of technology. In 2015, Nokia Technologies launched OZO, the world’s first virtual reality (VR) camera designed for professionals.About Nokia
Nokia is a global leader in the technologies that connect people and things. Powered by the innovation of Bell Labs and Nokia Technologies, the company is at the forefront of creating and licensing the technologies that are increasingly at the heart of our connected lives.With state-of-the-art software, hardware and services for any type of network, Nokia is uniquely positioned to help communication service providers, governments, and large enterprises deliver on the promise of 5G, the Cloud and the Internet of Things. http://nokia.com
About HMD global
Registered and headquartered in Helsinki, Finland, HMD is a new private venture founded to create a new generation of Nokia-branded mobile devices. HMD is run by a group of experienced industry leaders, including CEO Arto Nummela, previously of Nokia and currently the head of Microsoft’s Mobile Devices business for Greater Asia, Middle East and Africa as well as Microsoft’s global Feature Phones business, and President Florian Seiche, who is currently Senior Vice President for Europe Sales and Marketing at Microsoft Mobile, and previously held key roles at Nokia, HTC and other global brands.
www.hmdglobal.com
Microsoft
REDMOND, Wash. — May 18, 2016 — Microsoft Corp. on Wednesday announced it reached an agreement to sell the company’s entry-level feature phone assets to FIH Mobile Ltd., a subsidiary of Hon Hai/Foxconn Technology Group, and HMD Global, Oy for $350 million. As part of the deal, FIH Mobile Ltd. will also acquire Microsoft Mobile Vietnam — the company’s Hanoi, Vietnam, manufacturing facility. Upon close of this deal, approximately 4,500 employees will transfer to, or have the opportunity to join, FIH Mobile Ltd. or HMD Global, Oy, subject to compliance with local law.
Microsoft will continue to develop Windows 10 Mobile and support Lumia phones such as the Lumia 650, Lumia 950 and Lumia 950 XL, and phones from OEM partners like Acer, Alcatel, HP, Trinity and VAIO.
As part of the deal, Microsoft will transfer substantially all of its feature phone assets, including brands, software and services, care network and other assets, customer contracts, and critical supply agreements, subject to compliance with local law. The transaction is expected to close in the second half of 2016, subject to regulatory approvals and other closing conditions.
HMD Global
HMD global founded to create new generation of
Nokia-branded smartphones, feature phones and tablets.Senior telco leaders secure key partnerships with
Nokia, Microsoft & FIH Mobile Ltd.Press Release
HMD global founded to create new generation of Nokia-branded mobile phones and tablets
Helsinki, Finland – 18 May, 2016 – Nokia-branded mobile phones and tablets are set to return to the global consumer market, created by a new company, HMD global Oy (“HMD”). HMD has been founded to provide a focused, independent home for a full range of Nokia-branded mobile phones and tablets.
HMD has signed a strategic licensing agreement with Nokia Technologies, the advanced technology and licensing unit of Nokia Corporation, giving HMD sole use of the Nokia brand on mobile phones and tablets worldwide for the next decade, and cellular standard essential patent licenses.
HMD intends to leverage and grow Nokia’s global brand reach, delivering beautifully designed, high quality products to people all over the world in line with Nokia’s brand promise. HMD intends to invest over USD 500 million over the next three years to support the global marketing of Nokia-branded mobile phones and tablets, funded via its investors and profits from the acquired feature phone business.
To complete its portfolio of Nokia branding rights, HMD has conditionally agreed to acquire from Microsoft the rights to use the “Nokia” trademark on feature phones until 2024, and design rights relating to Microsoft’s Feature Phone Business. This transaction is expected to close in H2 2016. Together, these agreements will make HMD the sole global licensee for all types of Nokia-branded mobile phones and tablets.
The remainder of Microsoft’s feature phone business assets, including its Hanoi manufacturing facility, and global distribution, fulfilment and supply chain networks, will conditionally be acquired by FIH Mobile Limited (“FIH”), a subsidiary of Hon Hai Precision Industries (trading as Foxconn Technology Group). HMD has signed an agreement with FIH and Nokia Technologies to establish, on closing of the Microsoft transactions, a collaboration framework to support the building of a global business for Nokia-branded mobile phones and tablets. This agreement will give HMD full operational control over sales, marketing and distribution of its Nokia-branded devices, with exclusive access to the pre-eminent global sales and distribution network to be acquired by FIH from Microsoft, as well as access to FIH’s world-leading device manufacturing and engineering capabilities, and its growing suite of proprietary mobile technologies and components.
HMD is entering the global handset market at a time when consumers demand their mobile devices be part of a strong ecosystem that brings a compelling user experience delivered at a competitive price. HMD plans for its future Nokia-branded smartphones and tablets to run on the Android operating system, uniting one of the world’s iconic mobile brands with the leading mobile software and app development community.
HMD will be managed by an experienced group of mobile industry leaders. Arto Nummela, who previously held senior positions with Nokia and is currently the head of Microsoft’s Mobile Devices business for Greater Asia, Middle East and Africa as well as Microsoft’s global Feature Phones business, will serve as CEO on closing of the Microsoft transaction. HMD’s President on closing will be Florian Seiche, currently Senior Vice President for Europe Sales and Marketing at Microsoft Mobile, who previously held leadership roles at Nokia, HTC and other global brands.
Arto Nummela, CEO of HMD global, said:
“We will be completely focused on creating a unified range of Nokia-branded mobile phones and tablets, which we know will resonate with consumers. Branding has become a critical differentiator in mobile phones, which is why our business model is centered on the unique asset of the Nokia brand, and our extensive experience in sales and marketing. We will work with world class manufacturing and distribution providers to move quickly and deliver what customers want.”
Ramzi Haidamus, president of Nokia Technologies, said:
“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. 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.”
Vincent Tong, Chairman of FIH, added:
“We are looking forward to fostering a strong and long-term collaboration with HMD global and Nokia. We are impressed by the experience and expertise of the HMD management team and are committed to supporting them with our manufacturing, technology and supply chain capabilities, to capture market opportunities together in the future.”
Subject to receipt of all necessary regulatory approvals the transaction between HMD and Microsoft is anticipated to close in the second half of 2016. HMD will make further announcements about its plans and product roadmaps in due course.
Registered and headquartered in Helsinki, Finland, HMD is owned by Smart Connect LP, a private equity fund managed by Jean-Francois Baril, a former Nokia executive, as well as by HMD management. The Board of HMD will consist of five members, including one representative from Nokia.
