Just one day after the announcement that Microsoft Corporation (NASDAQ:MSFT) is buying Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V), current Microsoft CEO Steve Ballmer confirmed that Nokia exec Stephen Elop is one of the candidates who might replace him, reports Stephen Shankland for CNET.
Before going to Nokia, Elop worked for Microsoft Corporation (NASDAQ:MSFT) as the head of the Microsoft Office division. He then helped forge the close relationship between Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) and Microsoft culminating in the Windows Phone and is currently Nokia’s CEO.
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Nokia candidates may be similar to Ballmer
With a solid history at both companies, Elop is a natural choice to take the helm while Microsoft Corporation (NASDAQ:MSFT) brings Nokia’s divisions under its umbrella. Also, as someone who is now focusing on devices and services, he could be the right person to push Ballmer’s vision of Microsoft as more than a software company.
Ballmer’s departure has been met with a glut of articles essentially saying that he has mismanaged the company after Bill Gates stepped down as CEO. There have been calls for a change in direction, but with Ballmer listing internal candidates and vetting being done by a special committee of the board, including Gates, it seems more likely that someone with the same overall outlook will be selected. Microsoft executive Tony Bates and former VMware CEO Paul Maritz are also rumored to be in the running.
Nokia called a ‘value trap’ by Deutsche Bank
“Stephen will go from external [candidate] to internal,” Ballmer said in an interview with the Seattle Times. Assuming Elop would have been willing to leave Nokia for Microsoft, it’s not clear how much the change really improves his chances of becoming Ballmer’s successor.
The $7.2 billion deal between the two companies gives Microsoft Corporation (NASDAQ:MSFT) Nokia’s phone business, Qualcomm and other IP licenses, licenses for Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) patents for all Microsoft brands, and the right to use certain Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) trademarks in its products. Nokia is keeping Nokia Siemens Network, HERE, its CTO office, and its valuable patent portfolio. Nokia was previously called a ‘value trap’ by Deutsche Bank who says the firms gross margins have peaked and its revenues are declining. It identified NSN as the main earnings driver, so it seems strange that Microsoft was willing to acquire the rest of the company without that essential component.