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Nokia Looks Attractive After This Acquisition

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There was a point in time when the Finnish phone maker Nokia (NOK) was the undisputed champion in the mobile handset market and had prominent presence in several other business segments. However, after the sale of its handset business to Microsoft (MSFT), Nokia has been reduced to a telecom hardware provider and global location based service provider only.

While many consider this to be a sad situation for the phone maker, Nokia is able to see through the situation and is moving forward aggressively to the opportunities that are available. Recently the company completed the acquisition of Desti, a personalized travel planner that uses artificial intelligence to provide the user exactly what information he wants. Desti originally comes from SRI International, the same company that had developed Siri, the app that now Apple (AAPL) owns so proudly.

Nokia’s Latest Possession

The acquisition of Desti by Nokia and its addition to the Here mapping division comes as a well planned move from the company. Though Here accounts for only 10% of Nokia’s remaining business, the company is not talking the offering lightly. Nokia believes Desti’s expertise will add greatly to Here’s growth and help the app gain better user acceptance.

Desti has been available for consumer use for some time now and the overall customer experience has been very pleasing. However, following this acquisition, the app will no longer be available to consumers and it has already been removed from the App Store, and Nokia plans to complete shut down the app in the coming 90 days. Post all this, the only way one will be able to use Desti’s features will be through Nokia Here. The Finnish company will be working on combining both the offerings over the next few months.

Now that Nokia handsets are not a part of the company anymore, Nokia has very different plans to support its top-line. The company will be making its offering available to third-parties. But, the question is, will Nokia limit the benefits of Desti only to Microsoft devices, or will it go for other platforms also. Industry experts and analysts are of the opinion that over the span of next four years, Nokia will keep the service exclusive to Microsoft because of the mapping deal signed by the companies. After that, Nokia will surely launch Here on parallel ecosystems. This will also give some time to the app to gain popularity.

Competition

Leisure & Lifestyle is a segment that has witnessed huge growth in the past couple of years and industry experts believe the segment has unimaginable upside potential. No wonder why so many companies are thinking of getting in to it while it is still in the development stage.

It’s not just Nokia that understands the growing importance of location based services that will aid travelling. Google (GOOG) too has this in mind and is working rigorously to develop Google Maps. Recently the company acquired Quest Visual, the maker of the Word Lens app that provides instant translation of words from one language to another. The Mountain View based giant will be incorporating the features in its translation offering, as well as in Google Maps. Apart from Quest Visual, Google recently also acquired Skybox Imaging, a company that builds satellites and specializes in satellite imaging and video. Analysts believe the capabilities of Skybox will be added to Google Maps to enhance the app.

Departing Thoughts

Nokia missed the smartphone train once and lost most of its market share and eventually the story ended with the sale of its handset business to Microsoft. The company surely doesn’t want to go through all this ever again. Nokia has been investing a lot of time and money in R&D and is coming up with ways to enrich its remaining offerings. The company is trying to understand the pulse of the consumers and after this acquisition, it seems, Nokia is on the right path. The journey will not be easy for sure with Google and Apple also focusing on the same audience, but the Finnish company will have to find ways to make its offerings attractive enough to gain substantial consumer acceptance.

About the author:

Quick Pen
A seasonal writer with a Management Degree in Finance and interests in automotive, technology, telecommunication and aerospace sectors.

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