Some of Microsoft's latest acquisitions include Skype and the inclusion of Windows Phone platform on nearly all advanced Nokia phones. This last purchase even amounted to approximately $ 1 billion. There were also reports that Microsoft is similarly trying to make a deal to buy out the mobile business of Nokia for a whooping $30 billion deal.Some have regarded it as chitchat because of the huge amount.
It is without doubt that acquiring Nokia offers many perils. Extremely cut throat is the mobile phone market and venturing into the game development industry could estrange Windows Mobile associates Samsung and HTC that could mean the future of Microsoft mobile relying on this agreement. Entrenched by a culture that is slow to modifications, which is below Microsoft standards, buying out Nokia can suppress Microsoft as the demands of the mobile market persist to intensify. One can recall that Microsoft has been through this in the past when it purchased Danger for $500 million. The deal saw the failure of Microsoft Kin phones.
The sales of Windows phones still seem to be slow, and although it would seem to be an enormous risk for Redmond, there are still a few good reasons to think that the deal may be beneficial for Microsoft.
1. It makes it possible for the creation of a Skype phone. Skype exceeded 145 million users in a month lately while more than 5 million iPhone users had downloaded Mobile Skype. To relieve traffic, providers who once ignored calling via Wi-Fi have now started to uphold this technology.
2. Nokia is still creating brilliant hardware. Although Nokia is still creating excellent gadgets, it has fallen short in creating mobile services and software in the past years that can contend with the increased demands and the emergence of more competitive mobile phone companies. Acquiring Nokia will allow Microsoft to be at an advantage as it combines the first-rate gadgets of Nokia with its own notable new operating system.
3. Ovi is a huge distribution channel for mobile content and services and under the existing agreement, Ovi services will be incorporated into Windows 7 Phone. However, Nokia has plans of using the window to provide applications for all their smartphones. By acquiring Nokia, Microsoft will be able to manage Ovi Store and get absolute stewardship of the company.
Nonetheless, the past years have observed that Microsoft had no luck in the mobile phone industry and the deal with Nokia can finally put to stop its hopes of being one of the key players in this industry. On the other hand, the buyout can pave the way for Microsoft to have a healthy competition with Apple and Google in the superphone business. As steward of the software and hardware, Microsoft thinks that the deal will equip them in the rapidly increasing market for smartphone.
A good example is Apple. The company has a vertically integrated solution, where the controls of their products, hardware, and software and ecosystem application of its IOS are in their hands. Apple may not have biggest market share by OS, however it made Apple a lucrative phone maker. With Windows 7 and Nokia, Microsoft will be able to do the same thing. As one of the world's largest manufacturer of mobile phones, Nokia can still create units that are extremely good-looking like the N8. It may not be a cheap deal; nevertheless, the buyout gives Microsoft a chance to go around the globe for their marketing.
When taking into account the recent acquisition of Skype, applications and content ecosystem of Microsoft and the manufacturing chops of Nokia, Microsoft could offer a strong array of smartphones that could get the attention of both the upscale and downscale markets.
Furthermore, Microsoft will be able to manage its own future in the smartphone arena. It's capability to produce first-class products will determine its triumph or failure in this field.
Author Resource:
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