Microsoft is planning to exit the feature-phone business. Having acquired Nokia’s phone business in 2014 for roughly $7 billion, it is selling the entry-level cellphone business to HMD Global Oy and Foxconn for $360 million, according to The Wall Street Journal. Microsoft said it will continue to develop Windows 10 for mobile devices.
Microsoft has been a leader in feature-phone shipments. The Journal reports it shipped 15.7 million of the devices in the first quarter, vs. 13.1 million for second-place Samsung, according to IDC Research figures. But Foxconn is better positioned than Microsoft to wring profits from the low-margin devices.
In separate news, the Journal reports, Nokia is getting its name back in the mobile-phone business by licensing patent and design rights to HMD, which will manufacture Nokia-branded phones and tablets under a 10-year agreement. Nokia is expecting to capitalize on its brand name in developing countries.
Back in July 2015, Barb Darrow at Fortune quoted a former Microsoft manager as saying Africa and other emerging markets have 4 or 5 billion people who would be interested in feature phones.
The Journal has a slideshow tracing Nokia’s history back to 1865, when it began as a wood pulp mill company. In 1982 it introduced the world’s first car phone. In 1989 it divested its paper and other businesses to focus on telecommunications. The Journal also summarizes Microsoft’s involvement in the phone business, beginning in 2003 with the Windows Mobile operating system.
