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Microsoft Might Have Shot Itself in the Foot With Nokia Buyout

Was it ever a good idea to purchase the mobile part of Nokia ? Who was responsible of making that call?

Was it ever a good idea to purchase the mobile part of Nokia ?

It’s kind of interesting how Microsoft’s buyout of Nokia’ s cell phone hardware business took place. One would think that before the buyout, Microsoft strategists would look at how it would impact Microsoft’s existing licensing technology with other big named mobile phone manufacturers like Samsung or HTC. One would think this would be the case because this would just be purely common sense, right? Unfortunately, as we keep finding out through the news that we cover here, common sense nowadays isn’t all that common.

There is a big possibility of friction between Samsung, HTC, and Microsoft after the Nokia buyout. In short, Samsung would be a licensee of Window’s phone and would be a company that owns the Windows phone software. Do you see where this is headed? What’s wrong with this picture? Where are the incentives? Business alliances and deals are all about incentives. In short, everybody is looking for a win win situation. I go into a contract with you where I get something and you also get something. That’s how contracts and deals are made.

It remains to be seen if any win win situation is present with HTC and Samsung being licensees of Windows phone. You might ask where the advantage is as well as the value added to it. It’s not like like Samsung and HTC are benefiting a great deal from Windows phone OS because Android pretty much owns the mobile phones OS market. In the tablet space, it’s pretty much the same story.

It would be very interesting to see how hardware licensees react to Microsoft’s recent buyout move. This can be a case of Microsoft shooting itself in the foot. It doesn’t have the luxury of Google’s buyout of Motorola. In that case, Google isn’t really in a hurry to become a hardware maker. It was just primarily interested in the patents that Motorola had regarding mobile telephony. In this case, the same patent rationale is being played out but that rationale really has less traction here because Microsoft is a hardware player as you can see from its Xbox product line. It’s going to be really quite interesting how this deal is perceived by current Microsoft hardware licensees.

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