The “strategic agreement” which will see the Nokia brand return to mobile devices has come into force, although the new company behind the effort has remained tight-lipped on its product plans.
HMD Global, the company bringing new Nokia devices to market, completed previously-announced transactions involving contract manufacturer Foxconn and computing giant Microsoft, enabling it to begin its work as the new home for Nokia phones.
The first Android-based smartphone products from HMD will be launched in the first half of 2017, alongside the existing Nokia feature phone business acquired from Microsoft.
The company said that with a leading position in feature phones already, it has “a significant global foothold including Americas, Europe, Asia, Middle East, Africa, India and China from day one”.
“The market is fatigued and flooded with undifferentiated products. Consumers are looking for technology with clear purpose that is useful, exciting and with a brand they can trust, so our approach will focus on true, core user experiences and a dedication to quality,” said Florian Seiche, president of HMD Global.
HMD said a “cornerstone” of its partnership model is an agreement with Foxconn, which will manufacture its devices, “guaranteeing quality of manufacture and innovation at scale”, as well as offering R&D benefits. Samuel Chin, former chairman and CEO of Foxconn International Holdings, is a founder and chairman of HMD.
Nokia will receive royalty payments from HMD for the sales of Nokia-branded products, covering both brand and intellectual property rights. It is not an investor or shareholder in HMD.
Analyst firm CCS Insight is bullish about the company’s prospects; it recently predicted that Nokia-branded Android smartphones will grab 5 per cent global market share by 2019.
“We believe the key to the company’s success will lie in offering products that match the original Nokia attributes of quality, ease of use, reliability and distinctive design,” wrote CCS’ chief of research Ben Wood in a blog. “HMD global will need to invest significant amounts of money in marketing its Nokia products and must achieve significant scale in the global smartphone market quickly if it’s to create a profitable and sustainable business.”