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April 27, 2011

Microsoft News - Nokia and Microsoft Enter into Definitive Agreement

By Raju Shanbhag, TMCnet Contributor

Looking to provide a new global mobile ecosystem, Nokia (News - Alert) and Microsoft have signed a definitive agreement on a partnership, Microsoft has announced.

Nokia and Microsoft also announced significant progress on the development of the first Nokia products incorporating Windows Phone (News - Alert) in addition to agreeing to the terms of their partnership, including joint contributions to the development of the new ecosystem. The companies are collaborating on a portfolio of new Nokia devices, with hundreds of personnel already engaged on joint engineering efforts, Microsoft (News - Alert) stated in a press release.

According to the agreement, Microsoft will receive a running royalty from Nokia for the Windows Phone platform, starting when the first Nokia products incorporating Windows Phone ship.

“Our agreement is good for the industry,” said Steve Ballmer (News - Alert), CEO of Microsoft in a company press release. “Together, Nokia and Microsoft will innovate with greater speed, and provide enhanced opportunities for consumers and our partners to share in the success of our ecosystem.”

Nokia has also started porting key applications and services to operate on Windows Phone and joint outreach has begun to third party application developers. According to the agreement, Nokia will provide mapping, navigation, and certain location-based services to the Windows Phone ecosystem. While contributing expertise on hardware design and language support, and helping to drive the development of the Windows Phone platform, Nokia will build innovation on top of the Windows Phone platform in areas such as imaging.

Recently, former Microsoft veteran Stephen Elop, who joined Nokia last September to become the first non-Finn to head the company, sold all his shares in Microsoft worth €1 million (about $1.4 million) and used the money for buying 150,000 shares in the Finnish mobile phone company. The former Microsoft boss recently made news by calling his previous organization a “blazing oil rig.” Afterward, he went on to announce a major deal to switch Nokia phones from their home-grown Symbian (News - Alert) software to Microsoft's.

Raju Shanbhag is a contributing editor for TMCnet. To read more of Raju’s articles, please visit his columnist page.

Edited by Jennifer Russell

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