MERGERS : MICROSOFT GETS GREEN LIGHT TO BUY NOKIA'S MOBILE BUSINESS.

Microsoft is expected to wrap up, in early 2014, its 5.4 billion acquisition, announced last September, of Nokia's devices and services business, which includes its smartphone activity. After the United States gave the all-clear, on 2 December, the European Commission followed suit, on 4 December, concluding that the transaction would not create competition problems, particularly because "there are only modest overlaps between the parties' activities".

It also explains that the links between Microsoft's operating systems, mobile applications and enterprise mail server software with Nokia's smart mobile devices are unlikely to lead to shutting out competitors from the market. The executive adds that it would not be in Microsoft's interests to limit the development of its Windows Phone applications and services (Office, Skype) and that it would "not have the ability to restrict the interoperability of competing smart mobile devices with Exchange Server". Furthermore, several powerful competitors, such as Samsung and Apple, will continue to compete with the merged entity.

Microsoft, whose Windows Phone operating system for smartphones and tablets is lagging with only a 4.1% market share - used essentially on Nokia devices and lagging compared to Apple's iOS (13.4%) and Google's Android (81.3%) - plans with this deal to control not only the software side but also the mobile device production element of this segment, by manufacturing and selling under its own banner a range of devices equipped with Windows Phone and pocketing four times as much on Nokia devices powered by its operating system.

PATENTS

It also hopes to increase its market share thanks to the 2G and 3G patents essential to mobile telephony that it will acquire as part of the package. Outgoing CEO Steve Ballmer explained when the acquisition was announced that the firm wants to use these patents as leverage and to relaunch innovation to strengthen its competitive position. Another important aspect is that, thanks to these patents, Microsoft will be able to boost its fire power, particularly on the FRAND battleground (manufacurers holding patents are obliged to issue licenses to competitors for functions essential to the market on fair, reasonable and non-discriminatory terms).

Nokia, which was stronger on intellectual property than on anticipating consumer habits, is holding on to a war chest of patents. Over a 20-year period, it invested 3 billion in R&D that resulted in the issue...