Following the release of its third quarter results last week, Nokia's CFO Timo Ihamuotila talked about the value of the Nokia brand name in the mobile phone space, and how that market space was off-limits at the moment. Speculation remains high about Nokia's intention in the mobile phone space after the purchase of the Devices and Services section by Microsoft, and Ihamuotila made no effort to dissuade that view during the call.
When Microsoft closed the deal to purchase Nokia's smartphone and feature phone assets, a number of IP marks were transferred to Redmond. These included the Lumia brand name, and Microsoft is currently working through its transition process to use Lumia as the smartphone brand of choice for its handset business.
Microsoft also licensed the Nokia name to be used on smartphones and feature phones with a period of exclusivity and usage on both - Nokia smartphones would be exclusively under the Microsoft banner for eighteen months while Microsoft feature phones could be named Nokia up to ten years after the purchase.
It's in Microsoft's best interest to switch to a brand name that it has full control over as quickly as possible. This process has already started with the latest Windows Phones switching to the 'Lumia 830' or similar nomenclature.
Once those dates are past, naturally all bets are off.
(Read more about Microsoft's renaming plans for Windows Phone here).
Finland May Yet Return To The Mobile Handset Business
Nokia remains interested in the mobile space. The recent launch of HERE Maps as a public beta for Android shows competency and a willingness to experiment outside of its corporate history. While the Nokia X UI skin and Android launcher, along with the Nokia X range of handsets, went to Redmond as part of the purchase, I'm sure that Nokia could find the engineering talent to build a new and workable UI on top of the standard Android package if there was the will.
Let's go back to that call:
...we will of course carefully assess what would be the best way for us to maximize the value of the Nokia brand, also taking into account that we’re in the lock-up period still in the Microsoft transaction regarding our possibility to use the brand and we have recognized that Nokia brand is the most valuable from recognition perspective in the area of mobile phones and mobile devices. And there we cannot go yet at the moment.
No executive is going to lock out potential business development areas in the future on a conference call, but Nokia has always been aware of the lock-up period and when it will end. The executives have been keen to remind every one of the date they can return to the handset game, both in this earnings call and in previous calls. In my experience it's one of its goto lines when you ask about mobile plans.
Rather like a Finnish version of Chekhov's gun, Nokia is making sure everyone knows when they can get back into the game.
What could have been... Nokia X (image: press.nokia.com)
I for one will welcome the return of a newly invigorated Finnish smartphone manufacturer to the fold. And I wonder how much a fairytale that return will be?
Nokia has already dabbled with an Android UI layer - the Nokia X handsets looked remarkably like the Lumia interface in operation, and powered the Nokia X handsets running Android. As mentioned both the X handsets and the X launcher are now under the control of Microsoft, and it's likely that the engineers behind it are also on Redmond's books.
That's not to say that a new team couldn't put together an Android environment given funding and time. As HERE Maps improves and iterates on Android, not only would the new Nokia have Android code running on countless machines around the world, it would also have a clearer understanding of what is needed on a pervasive and significantly sized Android app, and the development teams required.
As for physical manufacturing, the rise of the Chinese OEM would easily take the strain of building these handsets. Don't forget that Nokia's first Windows Phone handset, the Nokia Lumia 800, was manufactured as an 'out of house' project with the help of Compal Electronics.
So it could be done, it cold be restarted from a blank sheet of paper rather quickly. But perhaps the answer is closer to home. Perhaps the answer is already in Nokia's home. Perhaps they just need the Linux life raft to return?
As I've pointed out here on Forbes previously, Nokia would not need to look far to find a team full of competency with smartphones. Sitting in its old Research and Development Centre in Helsinki is Jolla. Made up of former Nokia employees who are all hard at work developing the Sailfish OS and the Jolla handset, there is an obvious option on the table that would bring Nokia back into the smartphone market in 2016 with a new handset that has had years of development and man-hours poured into it.
Once Nokia is 'ready to go there', it has many choices to get back into the smartphone, but there is a certain circularity (and a sense of business interrupted) if the former Finnish powerhouse turns to the Jolla team to lead the charge.
