Why Do I (still) Think Nokia Will Be Sold (soon)? - This article explains it

Some of my long-term readers and Twitter followers know and understand the reason, but most probably don't know why I am 'so convinced' that Nokia will be sold (soon). I could write a typical Tomi-blog of 20,000 words to elaborate, but I don't need to. This article by Seeking Alpha explains it PERFECTLY. 

For those who might post comments - please remember (or new visitors, be aware) - I won't let this blog become a Wall Street stock market 'analysis' and arguments blog. So you may definitely discuss the 'valuation' of Nokia's parts, and for this blog entry, I'll allow Nokia historical views of its share price, but no speculation or debate about might Nokia share price go up or down in the near future. But yes, please go read the Seeking Alpha article, its short and sweet, explains EXACTLY why I still am convinced, Nokia will be sold (and soon). 

Comments

[QtFan]

I'm still convinced it will not.

Nokia will continue to shed its value, spining-off division, selling or gifting patents and IP and getting rid of the rest of the assets. Maybe they are deliberately trying to make a Nokia buy less attractive :-P

It is the best interest of MS that Nokia won't be sold and not buying it. Who knows what kind of contracts Nokia have tied itself to.

[przemo_li]

@QtFan
I would agree but currently MS try to diversify.

Yes current Nokia is perfect for Windows Phone as current Nokia do whatever MS want, but...

Its not working.

So MS must find broader alliance. And they do just that. So Nokia is not irreplacable element. And Nokia SOLD is better than Nokia BANKRUPTED by WinP strategy..

[Tester]

Nokia not an irreplaceable element?

Come on, they are the only ones stupid enough to bet their entire future on Windows Phone. They currently control 80+% of the Windows Phone market.

If they go down, the entire platform goes down with them. Samsung clearly has no interest, HTC is more or less in trouble as well and the rest - for now don't bother.

So, no, Microsoft can't let Nokia go down. They have to keep it alive at all costs, meaning they'll eventually sell everything except the Lumia unit. Just what Elop has been doing for the last 2 years.

[Vinicius]

Nokia will not be sold and WP8 will not thrive.

There is almost nothing to be gained from buying Nokia that wouldn't be accomplished cheaper by let it die by itself. Maybe snagging a few patents on a garage sale once it goes belly up, but now anything any company would like to do would be more expensive.

And on topic of why it is going to fail:

I now am an owner of a Lumia device. And I have to say they are not half-bad. Not half-good, either.
For the common man on the street the store seems EVEN MORE devoid of apps than Symbian! If Symbian is a desert, than WP8 is a barren, toxic wasteland. I can't find half the stuff I use on Symbian, and definitely it does not have 1% of Android or iOS apps.
There are many, many things that I struggle to do with it. Simple things like turning mobile data on and off. Using the keyboard. Configuring a new wifi. Things that are supposed to take a couple touches take a couple dozen ones.
And the lack of functionality of the base OS is baffling. Separate volume controls for Ring tone and apps? Between apps? Profiles? Configuration on the phone seems simpler and barer than a feature phone.

It would be pretty hard to grow again using such an ecosystem.

[RottenApple]

Nokia won't be sold - at least it won't be sold as a whole.

The writing is on the wall that they'll get rid of NSN - but if they do what's left?

Nothing but toxic waste!
- The feature phone division is going to crater this year or next. Nobody wants that.
- The Lumia division is deadlocked into something I wouldn't even call 'ecosystem'. An ecosystem is supposed to be healthy. WP depends on money being constantly thrown after it.
- HERE? Loss-maling. Why should anyone want to buy that. Any smart investor would let it go down with the empty shell.
- Patents? Elop already made sure it's a toxic mess by selling some of it to trolls with conditions that make any attempt to buy Nokia for the patents a futile undertaking.

So for most potential buyers it might be smarter to just sit it out, wait until Nokia goes down - and then buy some interesting pieces.

[foo]

Regarding the patents, we shouldn't forget that they have a fixed term: 20 years since the filling.

That means that Nokia's patents already lost 15% of their value since Elop was hired.

And Nokia’s most-cited patent—and therefore one of its most valuable—was issued in 1992 for a “method for mapping, translating, and dynamically reconciling data.”

[Brian Stephens]

Nokia won't be sold, but NSN will be flogged either at the end of this year or next year as Nokia's position continues to get worse. By the time NSN is sold, the feature phone division will be practically dead. Nokia will then abolish Series 40 and the Asha line of devices (early 2014) and instead concentrate solely on Windows Phone Lumia's. At that point, Microsoft will shaft Nokia yet again and abandon Windows Phone (late 2014) and adopt Android as their mobile OS (they'll probably end up doing what Amazon have done with Kindle Fire and create their own eco-system around an Android core with Microsoft branding on top of it). Nokia's remaining IP and assets will end up being sold (2015) to whichever company is the highest bidder.

[Turd Elopson]

@Brian Stephens

"At that point, Microsoft will shaft Nokia yet again and abandon Windows Phone (late 2014) and adopt Android as their mobile OS"

It is more likely that Microsoft will shaft Windows Phone 9 down Nokia's throat, and in the process Osborning all previous Lumia phones with WP8. And by then Nokia will be the only company in the world making Windows phones; other companies such as Samsung and HTC will have already abandoned Windows.

And that is the 'best case scenario'. What's a worse scenario you ask? Microsoft forcing Nokia to make Windows tablets. A phone company making tablets, and tablets which nobody wants (how well were the Surface tablets selling, hmm?).

Nokia making Windows tablets is like adding insult to injury, no different from hiring a prostitute then beating her up once you're sexually done with her.

As long as Stephen Elop (or some other Microsoft stooge) stays, nothing is going to change at Nokia.

[przemo_li]

Wonder if MeeGo community (Meer?) will be interested in getting MeeGo brand?

On one hand it would be nice, on the other Nokia did trashed it.

[Hansu]

So who would want to buy Nokia? Microsoft well yes but they are allready making their phones sure for their patents but Microsoft has Nokia Doing their products what else do they need. Apple well the patent portfolio would be intresting and they would have the cash in their backpocket to buy Nokia several times just for their patents, if Jobs was still alive and in charge I could see him doing it just to fuck with Samsung and the other Android makers byt Cook is a realist and also he has his own problems inside Apple with Schiller and Ive and their conflicting egos. Lenovo maybe or Samsung i doubt simply because the EU trade regulations won't allow it maybe I dont know. I dont think Nokia will be sold anytime soon and the main reason is this a year ago when things looked really bad for Nokia they were losing money hand over fist and share price was at an all time low then Nokia should have been bought because then whoever bought got it way under its market cap for a steal. Now the share price has risen and Nokia has started to make money again..ish breaking even but they have stopped the cash bleeding from what it was.

[Spawn]

> I dont think Nokia will be sold anytime soon

I don't think so too but cause of another reason: Todays Nokia is trimmed down to resell products, not to research, develop and innovate products themself. They lost that, fired, gone. Who needs a company that has no own products or the potential to make own products?

There are some valuable parts left within Nokia that produce something. HERE, NSN. This are the interesting pieces. There patents are for other reasons. Those 3 values left are in 3 very different areas. It would not make sense to buy all of Nokia, including the expensive problems lose-devisions like there Smartphone-segment are. It not makes sense cause everybody knows the situation Nokia is in. Buying only those parts that are from value for the buyer is possible thanks to continued money-burning while rated junk and hence no new cash.

At this point in time Nokia as a whole is only a name, brand left. The different devisions still acting under that brand are from interest for a buyer, not the whole package. That's why I doubt anybody buys Nokia as a whole. You not need the whole cow for a single burger. What will continue to happen is that valuable parts of Nokia are sold. Vertu, done. Patents, already started. NSN next, then HERE and maybe whats left from the feature-phone segment.

Nokia is falling apart and in that situation buying the whole package does not make sense.

[Tester]

Nokia must truly be desperate:

http://www.bloomberg.com/news/2013-04-28/nokia-betting-on-20-handset-as-it-loses-ground-on-iphone.html?cmpid=yhoo

[Anti-Retard]

@Tester

Are you retarded?

[e_lm_70]

NSN can be sold via IPO anytime ... Siemens is waiting for this moment for cash its investment.

But, NSN is the only source of income for Nokia now. Once sold NSN, Nokia become a losing company, with huge impact in Nokia share price, so, Nokia can't even sell NSN.

Nokia phone mobile division at this stage is not interested for anybody, except from Microsoft, but Microsoft control already Nokia, and history is saying that Nokia brand in the Telecom biznes works better the Microsoft or Surface brand ... so no point fro Microsoft to waste money for have direct control on Nokia, at the end Elop the criminal puppet is doing exactly what BallMer is ordering him.

So ... nothing new in the horizon for Nokia ... NOTHING.

Microsoft and American Funds need to keep Nokia under control for keep up a chance for Microsoft Windows Phone (in few markets WP is looking to get traction, so there is still some hope on the Micro & Soft alliance)

Except Finland and Italy ... Windows Phone has almost no traction ... Android is still growing, dumb-phone is a market in rapid decline ... so ... Nokia still have to suffer ... still focusing on keep their own cash reserves alive, via NSN and IPR ... Market and Investors give a Nokia share valuation so low that nobody believe Nokia can be anything acquired for a premium, nor going to make any decent profit anytime soon ...

Tchuss

e_lm_70

[Winter]

@Tester
In any respect, this $20 handset is a very good initiative. It will fail if it is only attempted to fund WP phones.

[Anti-Retard]

@e_lm_70

If I look through this latest Kantar data, I would say that WP-platform is getting quite good traction.

http://wmpoweruser.com/full-kantar-numbers-for-march-2013-shows-steady-windows-phone-progress-reaches-highest-sales-share-figure-so-far/

[foo]

@Anti-Retard says: "If I look through this latest Kantar data, I would say that WP-platform is getting quite good traction."

2% in China, 6.5% in EU5, and 5.6% in USA -- that's what you call a "quite good traction"???

Two questions:

1) Can Nokia survive with such low sales?

2) What will happen to WP when Nokia goes belly-up?

I would call it a disaster.

[vladkr]

@Anti-Retard :
"I would say that WP-platform is getting quite good traction."

At what cost ? Have you seen WP devices' retail prices VS competition ?

As Nokia - and I suppose HTC - is losing money on every Windows Phone sold; I would call that drifting more than traction : it's impressive on the short term, but one won't reach any destination this way.

[Tester]

The big problem with Windows Phone is not that it actually sells but how many of the sales are achieved.

A significant quantity of recent quarters' sales have been heavily discounted WP7 devices - especially in Italy where they have the highest share.

Sure, these numbers look nice in some statistics but ultimately these are a timebomb. Will those customers stay with Nokia for another phone or will they switch to a platform that is more widespread? It's all very uncertain. What's not uncertain is that Nokia's phone business is barely profitable at best - including the feature phones - a market that is going to implode very shortly.

And then you see a headline 'Nokia pushing $20 phone' and in the article they even admit that the main reason is to retain customers so that they can switch to a Nokia smartphone later.

This has to be the most idiotic and most desperate move one could make. Instead of curing the one problem of their low sales (Windows Phone, of course) they are wasting more money trying to sustain their losing strategy.

So what does that mean for potential Nokia buyers? It just reaffirms that the phone manufacturing division is a lost cause. Nokia may be able to sell the rest but no sane buyer would take over this toxic waste dump.

[Hansu]

@ tester Yes why not now tap into a virgin market an introduce a phone that people who never before had the opportunity to buy a phone have one and I have not seen any cheap android devices for 20USD for sale brand new and also it is tempting offer for those who want a spare phone I mean 20 bucks for phone which battery last for month on standby and a flashlight it's the bargain of century. Inderes an independet analyst company broke down the 105 and they calculated that Nokia would make around 1-2 usd per phone. So let me get this straight Nokia makes WP phone Bad, Nokia makes symbian phone great camera shitty in all other aspects GOOD, Nokia makes cheap phone that enalbles a poor farmer in Africa to buy his first phone and last's a month on a single charge and is almost indestructable, Bad?