Nokia proposes new Chairman; vendor will reap 'billions' from Microsoft - Mobile World Live

Nokia proposes new Chairman; vendor will reap ‘billions’ from Microsoft

30 JAN 2012

Nokia quietly pushed out two pieces of significant news last week. Firstly, the struggling handset vendor has confirmed it is to propose the founder of Finnish anti-virus firm F-Secure, Risto Siilasmaa, as replacement for its current chairman Jorma Ollila. Secondly, the company has indicated that its payments received from Microsoft – as part of its high-profile Windows Phone deal – will be greater than first thought.

The proposal of Siilasmaa for chairman was noted in the company’s press release about its AGM in May. “The Corporate Governance and Nomination Committee will propose in the assembly meeting of the new Board of Directors after the Annual General Meeting on May 3, 2012 that Risto Siilasmaa be elected as Chairman of the Board,” the company stated. It added that fellow board member Dame Marjorie Scardino will be proposed as vice chairman.

Jorma Ollila has chaired the company since 1999 and said last year that he would step down in May 2012. Siilasmaa has been a member of the Nokia board since 2008.

Meanwhile, Nokia’s fourth quarter financial statement indicated that the company could receive considerably more than the US$1 billion from Microsoft originally reported, as part of its deal to use the Windows Phone platform in its smartphones. "Our broad strategic agreement with Microsoft includes platform support payments from Microsoft to us as well as software royalty payments from us to Microsoft. In the fourth quarter 2011, we received the first quarterly platform support payment of USD250 million (EUR 180 million)," noted Nokia's financial release. It continued: "We have a competitive software royalty structure, which includes minimum software royalty commitments. Over the life of the agreement, both the platform support payments and the minimum software royalty commitments are expected to measure in the billions of US Dollars."

So, although Nokia will have to pay licensing fees to Microsoft for use of the Windows Phone software, it would appear that the Finnish vendor will also see a lucrative revenue stream from Microsoft. Reports suggest that the prices Nokia will pay Microsoft for licensing Windows Phone software will total far less than it receives from Microsoft, creating profit for the Finnish vendor.

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Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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