Shoppingkoo: Microsoft to pay Nokia 'more than $1 billion' to make Windows Phones

Though neither Nokia nor CEO Stephen Elop ever said there was an exchange of billions of dollars as a part of the company's tie-up with Microsoft for the Windows Phone platform, Bloomberg is sourcing "two people with knowledge of the terms" in saying that something in excess of $1 billion is flowing from Redmond to Espoo. Though the deal isn't yet finalized -- Elop said as much back at MWC -- it'd apparently call for Microsoft to pay out at least some of the cash upfront with Nokia sending cash in the other direction for device licenses. Interestingly, the deal is said to give Microsoft access to parts of Nokia's expansive patent portfolio -- and they'll have it for quite some time, too: the contract's apparently going to be good for "more than five years." That's more than most marriages, it seems (and roughly as expensive).

Microsoft pushes small update to Windows Phones to prepare for copy and paste update later on

Don't get too excited when you see this update notification pop up -- as far as we can tell, it's got nothing users will notice -- but we've just been told by Microsoft that the company is getting ready to send out the first software upgrade to Windows Phone 7 devices in the field early this week. It's being billed as a "minor update to help prepare" for thecopy and paste stuff (which we're assuming is still targeted for early- to mid-March, per Ballmer's MWC keynote), though the exact timing of this first one will vary a bit depending on carrier. Oh, and a note before you hook up to try to grab it: it also required a recently-pushed update to the Zune software (or the Connector for Mac OS), so you'll need to get that first before restarting the app and looking for the phone firmware.

Nokia CEO: cheap Windows Phones will come 'very quickly'

We'd raised our own concerns in interviews with both Stephen Elop and Microsoft's Aaron Woodman in the past week that Nokia could have difficulty pushing the Windows Phone platform low enough to fill the holes left by Symbian's departure in the bottom rungs of the market, but the Nokia CEO is making it very clear that he thinks that won't be a problem. In a talk with Finnish journalists on Friday, Elop said that it has become "convinced" that it can hit "a very low price point" and do it "very quickly," a strategy that will be key to converting significant swaths of Symbian market share into Windows Phone market share without losing it to other manufacturers or platforms. Of course, something tells us the leaked design concept(pictured right) doesn't represent the types of hardware Nokia has in mind for those low price points -- but no single device or market segment is going to take Espoo to the promised land here.

Motorola exec nearly rules out Windows Phone completely, lamenting 'closed platform'

Motorola may have once said that it was "open" to developingWindows Phone 7 devices, but it looks like that possibility is now a whole lot less likely than it already was. Speaking at Mobile World Congress this week, Motorola's corporate vice president of software and services product management, Christy Wyatt, said that while she would never say never, she doesn't envision Motorola using Microsoft's OS, and added that "it's not something we're entertaining now." Wyatt went on to say that "there were a bunch of things that we believed about Microsoft that ended up not being true, mostly about what functionality it would have in what period of time," and further explained that Motorola is looking for "an opportunity to create unique value," and it doesn't feel it can do that on a "closed platform" like Windows Phone 7. Obviously, it does feel like it can create unique value with Android, and Wyatt dismissed concerns about a potential duopoly between Android and Apple, saying that "It could be a duopoly on platforms but I'm not sure why having another OS is a good or bad thing." Incidentally, she also said that the upgrade process for Motorola's Android phones has "humbled" the company a bit, and she promises improvements in the future, noting that "we were better with Froyo then with Éclair and we'll be even better with Gingerbread."

Nokia CEO Stephen Elop talking with Microsoft, Symbian, MeeGo, and Windows Phone

We had a chance to sit down for a few minutes with the man who's arguably stolen the show here at Mobile World Congress this year -- Nokia CEO Stephen Elop -- to talk about everything from his time at Microsoft to the potential for a multi-billion dollar platform partnership with his former employer that he's hoping to foster over the coming years. Elop's emerged in the past week as an outspoken character who doesn't seem to shy away from a question, to speak his mind, or to tell it like it is, which makes this ten-odd minute segment a must-see. Check it out after the break. 

Important Choice: Nokia Dropping Symbian and MeeGo, Going with Windows Phone 7

In a dramatic change of strategy, Nokia announced a plan this morning to make Microsoft's Windows Phone 7 its default operating system. In the future, Nokia will stop developing operating systems and concentrate on smartphone hardware.

Devices already in the product pipeline will be released, but they will be among that last from this company running the Symbian OS, and there may be only phone ever with the MeeGo OS that Nokia spent the last year or so developing.

In the announcement today, Nokia CEO Stephen Elop pointed out that many of the specifics of this deal are still being negotiated.

The New PartnershipAlthough all the details have yet to be worked out, the plan is to let each of these companies concentrate on what they do best: Microsoft will develop the Windows Phone operating system, while Nokia will make smartphones to run it.

It's important to note that Nokia will not be the exclusive provider of devices running Windows Phone, as companies like Samsung, HTC, and LG are also Microsoft licensees. However, these companies are putting more of their attention into developing products based on Google's Android OS, while all of Nokia's focus will be on Windows Phone.  

Still, in order to to be competitive, Nokia is going to have to work hard to differentiate its products. Microsoft has a relatively restrictive set of hardware requirements for devices running its mobile operating system -- its specifies screen sizes and resolutions, processor speeds, and even button placements. This can make it something of a challenge for its licensees to produce products that are significantly different.

Still, Nokia has its strong brand to fall back on, as well as a reputation for offering smartphones with the best cameras available.

Bing is going power Nokia's search services, while Nokia Maps will become a core part of Microsoft's mapping services.

Nokia/Microsoft vs. Google and AppleThe agreement announced this morning is designed to bring together a pair of companies into an alliance to take on some very strong competitors.

Nokia is the world's largest phone maker, but it has run into problems creating successful smartphones. Despite its efforts and many millions spent on research, this company make most of its revenue from featurephones, a product category that's sliding into decline.

Microsoft has also struggled to make itself relevant in the global smartphone market. Windows Phone 7 is its latest offering in this category, but its only been available for a few months.

With Microsoft providing the operating system and Nokia the smartphone hardware, they think they have a team that can compete with Apple and Google.

Apple, of course, is the maker of the very popular iPhone while Google is the developer of the Android operating system. Although relative newcomers to the smartphone market, phenomenal growth over just a few years has made these companies very significant competitors, to the point where Microsoft and Nokia were becoming increasingly irrelevant.

"I am excited about this partnership with Nokia," said Steve Ballmer, Microsoft CEO. "The partnership announced today provides incredible scale, vast expertise in hardware and software innovation and a proven ability to execute."