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Microsoft has $60b in cash while Nokia's market cap is just $12b (reuters.com)
17 points by quadrahelix on May 6, 2012 | hide | past | favorite | 24 comments



Why buy it for at least $15 billion now (they'll have to pay a premium obviously), when they can wait say until the end of the year when it will be worth half of that? Nokia's share price is going down fast together with their revenues and market share. It will be worth a lot less 6-12 months from now.


That would be short sighted. Apart from price, they do want to buy it when its in a relatively stronger position. In another year, with even lesser share, it wont be as attractive.


Rule #1: never look at the current relative strength. Look at the trend.

(otherwise paraphrased as - never try to catch a falling knife)


Because the probability of a success of Windows Phone goes down with every day they get bad press and unhappy customers. Nokia is the only handset manufacturer really pushing Windows Phone.


I don't see that Microsoft buying Nokia could actually change any of that within a timescale that actually matters. In fact, being acquired, and the resulting organisational confusion that would result (at least temporarily) would probably makes thing even worse.


And the only staff remaining will be the people who couldn't find better positions elsewhere.


Do they want the people? I'd bet they just want the parent portfolio. Elop's moves certainly indicate Nokia doesn't feel it needs any internal software development and that it would rely on its partnership with Microsoft for that.

It's more or less like the deal Palm did with Microsoft which resulted in the Windows Mobile-running Treos - the press releases read like Palm would direct its user interface resources into helping make Windows Mobile a better PDA platform and Microsoft would offer WinMo and its Windows-friendly features for free.


Wrong. Nokia still does some of the best maps and guidance software on the market. You don't do that with "people who couldn't find better positions elsewhere".


Excellent work changing from the future to the present tense!

Your time travelling comment totally invalidates my reply regarding someone's prediction of the future.


This article ignores Nokia's large cash reserves (€9.8 billion). If windows 7 works then they likely have the cash to do it themselves. If it doesn't work then it's hard to know what the smart phone plan B is.

> Microsoft is already paying Nokia $1 billion a year to use its software on Lumia smartphones.

Is that number even remotely accurate? I couldn't find any sources that didn't discredit it. Wouldn't it be a matter of public record if true though?

Also disclaimer - I work for Nokia but have absolutely no knowledge about this topic beyond an obvious interest and a few google searches.


Microsoft and Nokia signed a deal last year, rumored to be $1B. Nokia disclosed in its financials for Q4 2011 that there was a payment of $250,000,000 so the rumor seems accurate so far. http://www.theverge.com/2012/1/26/2736132/microsoft-nokia-25...


Microsoft won't have to buy nokia. They have all the advantages they could get from that and none of the headaches.

If they do buy Nokia it will be for one reason only, to prevent another party from buying it.


Why doesn't Google buy Nokia in order to stop Windows Phone dead in its tracks? Would that be a pointless investment? Does Google already feel they've won?


Why doesn't Apple?

(Good) companies don't buy other companies to stop things, they buy them to build things.

Neither Apple nor Google worry about stopping Windows Phone - they are both concentrating on moving as fast as possible to no competitor will keep up with them.


I don't think the DoJ would ever approve that.


so should we all buy nokia stock in expectation of a takeover?


You shouldn't. I doubt that they will buy them, they might support them even more to market their Windows Phones, but why would MS buy them? They already have a deal to produce Windows Phones.

MS didn't buy any other pc vendor for the same reason. They want to sell and license the software, without having to build the hardware.


Yeah, and my house is for sale for just $300K when MS has $60 Billion in cash :). I would be shocked if they bought Nokia, it would mean a stop to all other non-Nokia Win phones. I am willing to bet that MS will suck it up and help Nokia for quite a while though.


I don't know why the other manufacturers haven't quit already. By staying on WP7, they're just helping Nokia, which at least was in the past one of their biggest competitors. All the credit for WP7 goes to Nokia right now, and Microsoft will also make sure of that.

If they didn't choose WP7 a year and a half ago, we wouldn't even be talking about WP7 right now, and they could've gotten rid of Nokia much more easily (which I'm sure it's something they'd like to see). But instead they sustained it until Nokia was ready to get all the credit for it, and now they'll get nothing out of it.


If Microsoft and Nokia can make Windows Phone work then it will be very attractive to other manafacturers. They can how up late to the party and still have something that -- in the eyes of the public -- is identical to leading product.


Why not buy Nokia for its patents and dump the rest of the business then?


<opinion> Probably Nokia would demand north of $20 billion to even be in the game. A few more bad quarters can lower the price, but still, it's Nokia.

MS has enough patents to scare the crap out of any rational company: they have been working in OS for decades and they patent everything. Long before the iPhone, MS came out with portable and mobile computers http://en.wikipedia.org/wiki/Windows_Mobile . The fact that their work never caught on, doesn't matter, the underlying tech is probably all patented. Add to that Nortel and Netscape patents (hello cookies, SSL and everything we take for granted now) and they are loaded with patents, especially since Android is an OS. Any win against MS is temporary; they don't mind opening their checkbook to license and to hire lawyers. As for Nokia's patents they can probably "buy" a few select ones to go after Motorola /Google instead of spending billions and billions

Edit to add: If not for Google, Motorola would have undoubtedly kissed the ring too, like Samsung and almost every other company did.

</opinion>


"Long before the iPhone, MS came out with portable and mobile computers"

Not to rain on your parade, but you do new about the Newton?

http://en.wikipedia.org/wiki/Newton_(platform) (which I loved)

And how late MS was to the portable game?


Re-reading my comment it seems like I dissed Apple. I didn't mean to, actually I meant to say that OS developers (Apple obviously included) have a lot of patents that pertain to smartphones.




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