Microsoft Was Close To A Nokia Acquisition Before Talks Broke Down Recently, WSJ Reports

Microsoft and Nokia have gotten pretty cosy over the past few years, and at the time of the announcement of the Finnish company’s decision to use Windows Phone OS to power its smartphones, many speculated it was the first overture for a coming acquisition. And that is apparently where things were headed, according to the Wall Street Journal, but the proposed deal has since fallen apart.

The WSJ says talks were taking place as soon as this month, but that they’ve collapsed to the point where they aren’t likely to get revived again, meaning a Microkia or Nokrosoft isn’t likely to happen anytime soon. Talks up until that point had been very advanced, the report says, but eventually broke down because of financial difficulties faced by both MS and Nokia.

Microsoft ended the courtship, per the report. Nokia has been struggling, and the Windows Phone plan hasn’t done much to shore up its continued losses. Nokia missed analyst expectations last quarter, and posted an operating loss, though a much lower one than it reported during the year ago period. Its device sales were down both sequentially and year over year, however.

Essentially, Microsoft and Nokia were able to have an extended dating period, and Microsoft had plenty of time to see that opting for marriage wasn’t likely to turn around the fortunes of either party. In fact, neither the fact that a merger was being considered, nor the fact that it fell through, should come as any big surprise to anyone who has been watching the progress of Nokia over the past few years, and of Windows Phone as a mobile platform.

What’s left now is to see where Microsoft goes next with smartphones, and whether it opts to try to jump start things with its own project, Surface-style, or seeks out someone else like Nokia who might be able to do a better job of lighting a fire under its mobile OS.