Microsoft Corp has announced
that it is buying Nokia's mobile phone business for 5.44 billion euros (Rs. 48027 Crores). Below
is Microsoft CEO Steve Ballmer's letter to employees on the acquisition.
From: Steve Ballmer
To: MS FTEs
Date: Sep. 2, 8:00
PM PDT (Sep. 3, 6:00 AM EET)
Subject:
Accelerating Growth
We announced some
exciting news today: We have entered into an agreement to purchase Nokia's
Devices & Services business, which includes their smartphone and mobile
phone businesses, their award-winning design team, manufacturing and assembly
facilities around the world, and teams devoted to operations, sales, marketing
and support.
For Microsoft, this
is a bold step into the future and the next big phase of the transformation we
announced on July 11.
We are very excited
about the proposal to bring the best mobile device efforts of Microsoft and Nokia together.
Our Windows Phone partnership over the past two and half years has yielded
incredible work - the stunning Lumia 1020 is a great example. Our partnership
has also yielded incredible growth. In fact, Nokia Windows Phones are the
fastest-growing phones in the smartphone market.
Now is the time to
build on this momentum and accelerate our share and profits in phones. Clearly,
greater success with phones will strengthen the overall opportunity for us and
our partners to deliver on our strategy to create a family of devices and
services for individuals and businesses that empower people around the globe at
home, at work and on the go, for the activities they value most.
We have laid out
Microsoft's strategic rationale for this transaction in a presentation that I
encourage you to read.
This is a smart
acquisition for Microsoft, and a good deal for both companies. We are receiving
incredible talent, technology and IP. We've all seen the amazing work that
Nokia and Microsoft have done together.
Given our long
partnership with Nokia and the many key Nokia leaders that are joining
Microsoft, we expect a smooth transition and great execution.
As is always the
case with an acquisition, the first priority is to keep driving through close,
which we expect in the first quarter of 2014, following approval by Nokia's
shareholders, regulatory approvals, and other closing conditions.
But I also know
people will have some questions about what happens post-close. While details
aren't final, here is what we know, and how we're generally approaching integration:
1. Stephen Elop
will be coming back to Microsoft, and he will lead an expanded Devices team,
which includes all of our current Devices and Studios work and most of the
teams coming over from Nokia, reporting to me.
2. Julie
Larson-Green will continue to run the Devices and Studios team, and will be
focused on the big launches this fall including Xbox One and our Surface
enhancements. Julie will be joining Stephen's team once the acquisition closes,
and will work with him to shape the new organization.
3. As part of the
acquisition, a number of key engineering leaders will be joining Microsoft from
Nokia, reporting to Stephen in his new capacity: * Jo Harlow, who will continue
to lead the Smart Devices team
* Timo Toikkanen,
who will continue to lead the Mobile Phones team
* Stefan
Pannenbecker, who will lead Design
* Juha Putkiranta,
who will lead the integration effort on Nokia's behalf
4. Regarding the
sales team, we plan to keep the Nokia field team, led by Chris Weber, intact
and as the nexus of the devices sales effort, so that we can continue to build
sales momentum. After the deal closes, Chris and his team will be placed under
Kevin Turner. We will develop a single integrated team that is selling to
operators, and there may be other integration opportunities that we can pursue.
Kevin will work with Chris Weber and Chris Capossela to make those plans.
5. Our operating
system team under Terry Myerson will continue unchanged, with a mission of
supporting both first-party and third-party hardware innovation. We are
committed to working with partners, helping them build great products and great
businesses on our platform, and we believe this deal will increase our partner
value proposition over time. The established rhythms and ways of working
between Terry and his team and the incoming Nokia team will serve us well to
ensure that we do not disrupt our building momentum.
6. We are planning
to integrate all global marketing under Tami Reller and Mark Penn. It is very
important that we pursue a unified brand and advertising strategy as soon as
possible.
7. Finance, Legal,
HR, Communications, DX / Evangelism, Customer Care and Business Development
will integrate functionally at Microsoft. Sourcing, customer logistics and
supply chain will be part of Stephen's Devices organization. ICM / IT will also
integrate functionally for traditional IT roles. We will need to work through
the implications for factory systems given the differing manufacturing
processes and systems at both Nokia and Microsoft.
8. We plan to
pursue a single set of supporting services for our devices, and we will figure
out how to combine the great Nokia efforts into our Microsoft services as we go
through the integration process.
9. There are no
significant plans to shift where work is done in the world as we integrate, so
we expect the Nokia teams to stay largely in place, geographically.
10. Tom Gibbons
will lead the integration work for Microsoft. While today's announcement is big
news, we have to stay heavily focused on running the current business. We have
a huge fall and holiday season ahead of us, so we need to execute flawlessly
and continue to drive our business forward. I have no doubt we will.
