European Commission clears Microsoft's Nokia purchase
The European Commission has given Microsoft's planned acquisition of Nokia's mobile device business the green light. EUapprovesmsnokia In a press release dated December 4, the Commission said it had investigated potential compeition concerns and found none.
Context & Ripple Effects
The European Commission's clearance completes a regulatory sweep that began with the U.S. Department of Justice's approval of the deal on December 2 and tracks the path Reuters reported on November 22, when sources said Brussels was set to wave through the $7.3 billion acquisition. The Commission says it investigated potential competition concerns and found none, clearing Microsoft to fold Nokia's handset business into its devices-and-services strategy.
Brussels has form here: it gave the same treatment to Microsoft's Skype purchase back in October 2011, so today's decision extends an established pattern of the EC approving Microsoft acquisitions that combine software assets with communications hardware. The pickup across GeekWire, TechCrunch, FOSS Patents and others signals how closely the mobile world is watching what Microsoft does with the last major independent phone maker.
First-order effects
- Microsoft can now move to close the $7.3 billion purchase of Nokia's mobile device business, putting Lumia hardware, Nokia's patent portfolio, and roughly the entire Windows Phone installed base under direct Redmond control.
- Nokia is left to operate without the division that defined it, becoming a smaller company centered on its remaining businesses — mapping and network infrastructure — while its brand licensing arrangement with Microsoft governs how long the name stays on phones.
Second-order effects
- Google and Samsung face a consolidated rival that controls both its mobile OS and its flagship handsets end-to-end, raising the stakes on their own software-hardware integration plays just as the holiday quarter sales numbers come in.
- Other Android OEMs weighing a Windows Phone second-source strategy must now judge whether Microsoft will favor its own Nokia hardware, potentially chilling licensee interest in the platform Microsoft just paid billions to control.
Third-order effects
- If Microsoft integrates Nokia's patents into cross-licensing pressure against rivals — as its litigation posture against HTC already hints at — device makers may increasingly compete under terms set by the few firms holding both operating systems and large patent portfolios.
- A completed deal would also mark the end of the standalone European handset champion, accelerating a structural shift in which phone manufacturing consolidates around companies whose primary profit engine lies elsewhere in the stack.
The trend: Global regulators are treating Microsoft's acquisitions of hardware and communications assets as pro-competitive rather than blocking them, clearing the way for vertically integrated software-plus-device conglomerates in mobile.