Nokia makes some major structural changesBy Hanleigh Daniels 15 June 2012 | Categories: news
The IDC (International Data Corporation) recently revealed that it expects Windows Phone OS powered smartphones to occupy the number two spot (after Android) on the mobile platform podium by 2016, with over 19% market share. This expectation is based on Nokia’s strength in emerging markets, which the research company believes will see it push pass Apple’s iOS that is currently dominating the mobile OS landscape along with Android.
Unfortunately, Android and iOS’s current domination is putting the squeeze on Nokia’s finances, since sales figures for its Lumia range of Windows Phone Mango running mobile devices, such as the Nokia Lumia 800 and Lumia 710, have not exactly set the mobile world alight.
Selling luxury brand Vertu
Now the Finnish firm is making some major changes in order to raise its income and cut its expenses. The company announced that it is selling the luxury phone maker Vertu to private equity group EQT VI. This transaction is expected to close during the second half of this year and the financial terms of the deal was not disclosed. Nokia will retain a 10% minority stake in Vertu.
Structural changes, jobs are going
Besides this latest sale, Espoo revealed a shake-up within its leadership structures and also that it plans on cutting its workforce by up to 10 000 positions worldwide by the end of 2013. Nokia has kicked off the process of engaging with employee representatives in accordance with country-specific legal requirements.
Stephen Elop, Nokia president and CEO said: “These planned reductions are a difficult consequence of the intended actions we believe we must take to ensure Nokia’s long-term competitive strength.”
“We do not make plans that may impact our employees lightly, and as a company we will work tirelessly to ensure that those at risk are offered the support, options and advice necessary to find new opportunities.”
One Scalado please
But while selling off Vertu and laying off employees, the Espoo-based cellphone giant is also making a strategic acquisition by acquiring the imaging specialists and imaging technology IP (intellectual property) portforlio of Scalado. This transaction is expected to close during Q3 2012 and the financial terms of the deal remain confidential.
“Nokia has been working with Scalado for more than ten years and they’ve contributed to many of our leading imaging applications,” stated Jo Harlow, executive vice president for Smart Devices at Nokia.
“This transaction would enable us to combine our leadership in camera devices with their expertise in imaging, helping people move beyond taking pictures to capturing moments and emotions and then reliving them in many different ways,” Harlow concluded.
In related news, Nokia also announced last month that it has filed patent claims in the US as well as Germany, via which the company alleges that products from HTC, BlackBerry holding company RIM (Research In Motion) and Viewsonic infringe upon a number of its patents. The Finnish firm didn’t specify which of these companies’ products are infringing upon its patents.
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