John Paczkowski

Recent Posts by John Paczkowski

Microsoft’s Nokia Deal by the Numbers

Microkia

While $7.2 billion might be the headline number on Microsoft’s agreement to purchase Nokia’s devices and services business, there are plenty of other figures to consider as part of the transaction. Here’s a quick rundown:

  • Microsoft is spending about $7.2 billion to acquire Nokia’s core cellphone business.
  • Of that, $5 billion is for Nokia’s devices business.
  • The remaining $2.18 billion is to license Nokia’s intellectual property
  • Nokia’s patent portfolio includes some 8,500 design patents.
  • It also includes approximately 30,000 utility patents and patent applications.
  • About 32,000 Nokia employees are expected to transfer to Microsoft as part of the deal.
  • About 18,300 of those are “directly involved in manufacturing.”
  • But 56,000 Nokia employees will remain at the company once the deal has closed.
  • With 8.7 million units shipped, Windows Phone had a 3.7 percent share of global smartphone market in the second quarter of 2013, according to IDC.
  • Windows Phone has greater than 10 percent share in nine markets, according to Microsoft.
  • Windows Phone is outselling BlackBerry in 34 markets — again, according to Microsoft.
  • Nokia accounted for 81.6 percent of all Windows Phone smartphone shipments during the second quarter of 2013.
  • Microsoft’s gross margin on sales of Nokia’s Windows Phone handsets before the deal: Less than $10.
  • Microsoft’s expected gross margin on sales of Nokia’s Windows Phone handsets after the deal: More than $40.
  • Nokia’s share of the smartphone market was 49.4 percent in 2007.
  • By fall of 2012, it was 4.3 percent.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik