The “Apple of China” is now being considered to be a partner of mobile company Nokia. In recent reports, the two companies just signed a collaborative agreement which also includes a multi-year patent agreement. Nokia and Xiaomi will have cross-licensure of both of the companies’ cellular standards crucial patents. Plus, Xiaomi will obtain a definite patent asset from Nokia.
In the deal, Nokia will be able to provide a systematic network infrastructure equipment to Xiaomi in which can help the Chinese company in data centers expansion which eventually will help the company to explore more markets in the time coming.
In 2014, Nokia has successfully marketed its handset manufacturing commerce to Microsoft. It also acquired Alcatel last year making it place third as the biggest networking infrastructure equipment provider just right after Huawei and Ericsson.
Unfortunately for Nokia, the said business sector has been nothing but slow in the past quarters. It was the likely result of the strong market rivalry and also the weakening consumer spending behavior on wireless carriers. Marketing infrastructure equipment to an immense client like Xiaomi could fortify that corporate, which had its revenue decline at about 6% annually in the preceding quarter while counting 91% of Nokia's highest link.
For the time being, Nokia’s utmost developed business is its licensing division in which it had erected throughout the deal with Microsoft to shelter its patents. Nokia Technologies’ revenue increased at about 25% annually in the previous quarter. However, it only accounted for 5%
Meanwhile, Nokia's highest growth business is its licensing unit (Nokia Technologies), which it formed following the Microsoft deal to house its patents. The unit's revenue rose 25% annually last quarter, but only accounted for 5% of Nokia's highest link.
Majority of the development sprouted from Nokia’s buying of Withings – a connected fitness device manufacturer. Though, some of them also were from the licensing deals for innovative tablets and phones which are branded under Nokia. Licensing patents to Xiaomi can really boost the business generally.
In China, the Apple of China is not called as such for no reason. Xiaomi was the top smartphone producer in the country until Huawi, Vivo and Oppo joined the competitive market scene.
Distinctively, Xiaomi was able to maintain its captivity to its Market in China unlike Huawei. It is predicted that once Xiaomi caters to the international market such as America, Xiaomi can certainly dominate the list of competition such as Samsung and Huawei. This is the sole reason as to why Xiaomi purchased at around 1,500 patents from Microsoft in the preceding year and why it considered partnering with Nokia.
Nokia is currently on slow bullish trend. In its recent trades, the tech stock added -0.32% from its opening of 6.20 which finished at 6.24.
However its indicators had gone down. Its RSI Level was found dipping at 48.15 and its Coppock curve was seen way down the negative zone of -5.53. With that being said, a sell would be much more recommended for the stock as it is in a risky zone.
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