Microsoft to Rebrand Nokia Phones

Here’s what Elop said in an interview earlier today in Finland:

Microsoft Mobile Oy is a legal construct that was created to facilitate the merger. It is not a brand that will be seen by consumers. The Nokia brand is available to Microsoft to use for its mobile phones products for a period of time, but Nokia as a brand will not be used for long going forward for smartphones. Work is underway to select the go forward smartphone brand.

In the same interview Elop said that Microsoft will continue to support the Nokia X line which is powered by the Android operating system from Google Inc. (NASDAQ: GOOG). Elop explained:

Nokia X uses the MSFT cloud, not Google’s. This is a great opportunity to connect new customers to Skype, outlook.com and Onedrive for the first time. We’ve already seen tens of thousands of new subscribers on MSFT services.

Whether those tens of thousand of new subscribers are using Nokia X phones is not made clear.

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Changing the branding on the Nokia smartphones could be a big disaster or just a small problem, depending on how well Microsoft manages the change. To be honest, the company doesn’t have an awful lot to lose. According to the latest data from Kantar Worldpanel ComTech, Nokia’s market share in Europe for the first quarter of this year was 8.1%, compared with 70.7% for Android and 19.2% for iOS from Apple Inc. (NASDAQ: AAPL).

In answer to another question about why developers should keep working on apps for Windows Phone now that the company makes its own hardware Elop said that the company’s intention is to have the devices group “make the market” for Windows Phone and encourage the participation of other handset makers in that market. Google couldn’t pull that off when it acquired Motorola’s handset business, and it seems unlikely that Microsoft will be able to do better.

Microsoft’s share price is up 2% in the mid-afternoon Monday at $40.70 in a 52-week range of $30.84 to $41.66.

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