Under a 10-year licensing agreement, Microsoft Mobile held rights to sell feature phones running the S30+ platform under the Nokia brand.
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Originally Microsoft had established a major partnership with Nokia in 2011, in which the company exclusively produced smartphones using the Windows Phone platform, and promoted Microsoft services on its feature phone products (including Bing search). Microsoft also licensed Here Technologies data for its own mapping services. While Nokia's resultant Lumia range had the largest market share out of all Windows Phone vendors, Nokia's overall market share was falling rapidly due to competition from other major vendors, resulting in a dire financial situation. In September 2013, Microsoft announced its acquisition of Nokia's devices and services businesses, which closed with the formation of a Finnish subsidiary, Microsoft Mobile. On smartphones, the Nokia name was phased out in favour of Microsoft branding on future Lumia products. While the Lumia range continued to be successful, especially with low- and mid-range devices targeting emerging markets, sales of both Microsoft-manufactured smartphones and feature phones began to see major declines, due primarily to the rapidly-deflating market share of Windows Phone. In 2015, Microsoft took a US$7.8 billion write-down on the Nokia purchase, and announced layoffs of 7,800 employees, primarily within Microsoft's phone business. In May 2016, Microsoft abandoned its mobile business, selling the Nokia feature phone line and trademark rights to the Finnish startup HMD Global, and announcing that it planned to cut up to 1,350 positions in Finland and focus on offering its productivity services on competing mobile platforms.
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In 2017, Microsoft executive Joe Belfiore revealed that Microsoft had ceased the development of new Windows phones and new features for Windows 10 Mobile, citing the losses in market share and lack of app development. Nokia Lumia 800, Nokia's first device running Windows Phone. In February 2011, Nokia CEO Stephen Elop and Microsoft CEO Steve Ballmer jointly announced a major business partnership between the two companies, which would see Nokia adopt Windows Phone as the primary platform for its future smartphones, replacing both Symbian and MeeGo. The deal also included the use of Bing as the search engine on Nokia devices, and the integration of Nokia Maps into Microsoft's own mapping services. Nokia announced that it would still release one device running the MeeGo platform in 2011, but that it would devote fewer resources to future development of the platform, and would phase out Symbian entirely. Īs Nokia was the largest mobile phone and smartphone manufacturer worldwide at the time, it was suggested the alliance would help Windows Phone, but from the beginning of 2011, until 2013, Nokia fell from #1 to #10 in smartphone sales.Īligning with Microsoft had been considered a possibility by analysts, due to Elop's prior employment with the company. In June 2011, Nokia was overtaken by Apple as the world's biggest smartphone maker by volume. In Q2 2011, amid falling sales, Nokia posted a loss of €368 million, after having realized a profit of €227 million in Q2 2010. In September 2011, Nokia announced it would cut another 3,500 jobs worldwide, including the closure of its Cluj factory in Romania, after having cut as many as 7,000 the previous April. In August 2011 Chris Weber, head of Nokia's subsidiary in the U.S., stated that "The reality is if we are not successful with Windows Phone, it doesn't matter what we do. He further added, North America is a priority for Nokia because it is a key market for Microsoft. On 26 October 2011, Nokia unveiled its first Windows Phone 7-based devices, the high-end Lumia 800 and the mid-range Lumia 710, at its Nokia World conference. After this announcement, Nokia's share price fell about 14%, its biggest drop since July 2009. Nokia's smartphone sales, which had been increasing, collapsed.
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