Nokia moves to realize Internet ambitions

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Nokia Corp. said it would purchase Trolltech ASA, a Norwegian software company, for about $153 million, subject to approval by Trolltech’s stockholders. Nokia appeared eager for the deal and Trolltech seemed amenable as the Finnish handset giant offered a 60% premium above Trolltech’s closing price Friday on the Oslo stock exchange. Nokia said it would acquire Trolltech’s employees, software assets and current platforms, including Qtopia and Qt.

Nokia's stock remained relatively unchanged on the news. Trolltech specializes in Linux-based, open-source, cross-platform software. Nokia’s purchase could further its ambitions to use its massive installed base of mobile phone users -- it just reached 40% global market share -- to offer a unified, Internet-based suite of services, one of which is Ovi, its recently announced multimedia and gaming service. Indeed, Nokia said as much in today’s announcement.

The acquisition leaves Motorola Inc. in “an awkward position,” Leach added. “(Motorola) recently announced that it would continue to use Qt as a basis for all its Linux devices. This leaves Motorola beholden to Nokia for a key part of its technology strategy.”

Nokia’s purchase of Trolltech, which is a member of the LiMo Foundation -- one of several high-profile efforts to establish a global standard for Linux -- could tip the balance toward LiMo’s efforts over Google Inc.’s Android project, according to Leach.

Nokia’s market position is virtually the opposite of Internet-giant Google, which recently unveiled its Android project, supported by the Open Handset Alliance. Android is another Linux-based, open-source effort to develop a global standard.

Google has compelling Internet search and mapping capabilities that serve an advertising-revenue model, but no homogeneous, installed base of handset users. Nokia sells nearly 400 million handsets each year, but has yet to realize its ambitions for profitable, Internet-based services that can be accessed via PC, mobile phones or other devices. Apple Inc., of course, has its own, closed ecosystem of devices and multimedia services.

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