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Microsoft to buy Nokia phones, patents for $7.2 billion

  • Nokia sign at the headquarters of Finnish mobile phone manufacturer Nokia in Espoo, Finland on Tuesday morning, 3rd Sep., 2013. U.S. giant Microsoft will buy Nokia's mobile phone business and patents. LEHTIKUVA / Sari Gustafsson *** FINLAND OUT. NO THIRD PARTY SALES. ***

REDMOND, Wash. — Microsoft is buying Nokia's line-up of smartphones and a portfolio of patents and services in an attempt to mount a more formidable challenge to Apple and Google as more people pursue their lives on mobile devices.

The 5.44 billion euros ($7.2 billion) deal announced late Monday marks a major step in Microsoft's push to transform itself from a software maker focused on making operating systems and applications for desktop and laptop computers into a more versatile and nimble company that delivers services on any kind of Internet-connected gadget.

Microsoft, which is based in Redmond, Wash., is being forced to evolve because people are increasingly pursuing their digital lives on smartphones and tablet computers, causing the demand for PCs to shrivel. The shift is weakening Microsoft, which has dominated the PC software market for the past 30 years, and empowering Apple, the maker of the trend-setting iPhone and iPad, and Google, which gives away the world's most popular mobile operating system, Android.

Nokia, based in Espoo, Finland, and Microsoft have been trying to make inroads in the smartphone market as part of a partnership forged in 2011. Under the alliance, Nokia's Lumia smartphones have run on Microsoft's Windows software, but those devices haven't emerged as a popular alternative to the iPhone or an array of Android-powered devices spearheaded by Samsung Electronics' smartphones and tablets.

Microsoft is betting it will have a better chance of narrowing the gap if it seizes complete control over how the mobile devices work with its Windows software.


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