MSFT’s Nokia Corporation (ADR) (NOK) Buy Worries Chinese Manufacturers

Nokia 8Hermann / Pixabay

Chinese mobile-makers have asked the regulatory bodies to ensure that Microsoft Corp. ’s (MSFT) $7.5 billion bid to take over Nokia Oyj ‘s (NOK) handset business does not result in higher patent fees in wireless technology.

Microsoft and Nokia announced the planned transaction in September to combat the likes of Apple Inc.’s (AAPL) iPhone and devices running Google Inc.’s (GOOG) Android platform. Microsoft won the European Union approval for the bid on Dec. 4, while regulators declared that they would monitor Nokia’s licensing practices.

Shipments of Windows Phone grew 156% year over year and there is a possibility that the inclusion of Nokia’s devices business into Microsoft will make the Lumia a stronger competitor.

However, the deal poses a concern for Chinese manufacturers who apprehend that Microsoft’s takeover will result in higher patent fees on wireless technology.

Of the top seven handset manufactures in the world, four are Chinese vendors. According to IDC, Samsung accounted for a 31% share of the market in the third-quarter of this year while Apple had a 13% share. Huawei came next with 4.8% share, followed by Lenovo Group with 4.7%. The rest of the manufacturers in the list include Korea’s LG Electronics, China Wireless Technologies and ZTE.

Microsoft Corporation develops, manufactures, licenses, sells and supports software products. The company operates in five segments: Windows & Windows Live Division, Server and Tools, Online Services Division, Microsoft Business Division, and Entertainment and Devices Division. Microsoft reported revenues of $18.53 billion in fiscal first quarter of 2014.

Currently, Microsoft has a Zacks Rank #3 (Hold).

APPLE INC (AAPL): Free Stock Analysis Report

GOOGLE INC-CL A (GOOG): Free Stock Analysis Report

MICROSOFT CORP (MSFT): Free Stock Analysis Report

NOKIA CP-ADR A (NOK): Free Stock Analysis Report

To read this article on Zacks.com click here.

 

Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)

For exclusive info on hedge funds and the latest news from value investing world at only a few dollars a month check out ValueWalk Premium right here.

Multiple people interested? Check out our new corporate plan right here (We are currently offering a major discount)



About the Author

Zacks
At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1986 it has nearly tripled the S&P 500 with an average gain of +26% per year. These returns cover a period from 1986-2011 and were audited and attested by Baker Tilly, an independent accounting firm.

Be the first to comment on "MSFT’s Nokia Corporation (ADR) (NOK) Buy Worries Chinese Manufacturers"

Leave a comment

Your email address will not be published.