Linked by Thom Holwerda on Wed 18th Sep 2013 23:07 UTC
PDAs, Cellphones, Wireless

Cyanogen, makers of popular software based on Android that extends the abilities of smartphones, is making a bid for the mainstream. The four-year-old company, which began as a one-person side project, said today that it has raised $7 million from Benchmark Capital and Redpoint Ventures. The goal is to vault past Blackberry and Windows Phone to become the third-most popular mobile operating system, after traditional Android and iOS. And the company is already closer than you might think.

The announcement blog post has more details and background. This is either the best idea they've ever had, or the beginning of the end. I honestly have no idea which of the two it will be. I like the fact that they might be more popular than Windows Phone though - puts everything into perspective, doesn't it?

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RE[2]: Comment by Nelson
by Nelson on Thu 19th Sep 2013 11:34 UTC in reply to "RE: Comment by Nelson"
Nelson
Member since:
2005-11-29

Hi,

Sure id be happy to go into some of it. First we can go back to 2010, the stock is tanking, Symbian market share is falling, and probably worse, Nokia as a brand is eroding.

The Board took a hard look (including Android) and decided to take an olive branch from Microsoft. It included a ready made OS and ecosystem, billions of dollars in financial support, engineering collaboration, etc

This isn't a deal they could extract from anyone else, especially when they were starting to be outpaced by the market, facing pressure from the impending Android apocalypse, and their white horse MeeGo was a stagnant joint venture with Intel (we all know what a good partner they are).

So Nokia made a choice, and 10 months later they had a phone on the market, then six months later they had another one, then the pace increased until today there's a device roll out every two or three months.

They also got their mapping IP front and center in this OS and also relaunched some of their forgotten services (Music for example).

Lumia sales increased QoQ every quarter except one single since their launch two years ago. Lumia name recognition is growing, the ecosystem is growing, market share is growing (EUR5, UK, France, Italy, Mexico, India, NZ, Latin America) and they are approaching break even (12.5 million according to MS with double digit sequential growth over the past few quarters).

What was the problem then, why sell? MSFT likely gave them a more certain future. Does Nokia roll the dice and hope they have the cash to keep up the momentum, or do they take the parachute from MS and reevaluate the fundamental direction of the company?

They chose the latter and unloaded an unprofitable division to MSFT for 7 billion, increasing their cash to 10 billion, which is some nice breathing room. As well as some nice immediate long term loans from MS.

Now Nokia is free to chart a new path, go into telecommunications via NSN by acquiring smaller players or they can focus on optics, or monetize their enormously valuable patent portfolio, or all of the above.

Nokia offloaded risk and kept the reward (Platform support payments to MS without having to reciprocate licensing fees for WP devices, and they own 100% of a profitable venture with NSN)

Their stock went from 4 to almost 7 dollars and they're even talking about a dividend payment.

Elop and the board saved the company and secured 32,000 jobs to MSFT, ensuring the Lumia line up lives on.

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