A couple of hours ago, Nokia’s debt was downgraded by Moody’s to Junk!
Nokia was once the world largest vendor for mobile phones with almost 130,000 employees, but since the iPhone and Android, they have since fallen on hard times–who would’ve thought?
Just 16 months ago, in February 2011, Nokia announced a strategic partnership with Microsoft to try and stem their losses by adopting Windows Mobile, but this was like a drowning victim grabbing on to whoever is nearby to try and save themselves but only ends up in a double drowning.
No, Microsoft is not drowning exactly, but their stock has been more or less flat from a decade ago and one of the worst large-tech stock performers for the last ten years!
Will the acquisition of Yammer for $1.2 billion this week change this trend–I doubt it.
Between Yammer for social networking and the acquisition of Skype for video-calling last year (May 2011) for yet another $8.5 billion, Microsoft is trying to fill some of it’s big holes in its technology portfolio, just like Nokia was trying to fill it’s gaping hole in mobile operating systems by partnering with Microsoft.
Unfortunately both Microsoft and Nokia have essentially missed the boat on the mobile revolution and the sentiment is flat to negative on their long-term prospects.
So the shidduch (match) of Nokia and Microsoft seems like just another case of misery loves company.
Desperation makes for lonely bedfellows, and thus the announcement this week by Nokia that they are going to layoff 10,000 and close 3 plants by end of 2013 was really no surprise.
Aside from the short-term stock pop from the news of the acquisition, what do you think is going to be in the cards for Microsoft if they don’t get their own innovative juices back in flow?
Can you just acquire innovation or at some point do you need to be that innovative company yourself once again?
Hopefully for Microsoft they can get their mojo back on–meaning rediscover their own innovative talents from within and not just try to acquire from without.
(Source Photo: here with attribution to Kidmissile)