Microsoft took serious steps towards acquiring Nokia's handset business, but stepped back from the table over issues of cost and concerns the Finnish firm's hand in the market had slipped.
That's according to the Wall Street Journal, which claims people "familiar with the matter" stated a deal was close to being realised, despite the fact Nokia is already aligned to Microsoft's Windows Phone business.
Back to the drawing board
The paper claims talks of a deal between the two parties began back in 2010 when Nokia named former Microsoft executive Stephen Elop as CEO, following the departure of Olli-Pekka Kallasvuo.
It's suggested that, by the following year, a merger between the two companies in some form was deemed inevitable, though the Redmond giant was reportedly unable to negotiate the price it wanted for Nokia, which has a market cap of around $14.3 billion.
Bringing Nokia on board would have been seen as another step towards Microsoft challenging Android and iOS at the top table, even though the Finnish firm has committed itself to Windows Phone for its smartphone operations.
The Huawei question
Indeed, the smartphone business has been increasingly toxic for Nokia in recent years.
The firm, which was once the world's largest phone manufacturer, shipped 6.1 million smartphones in Q1 2013 some way off the 37 million iPhones Apple sold in its most recent quarter.
Estimates suggest Korean rival Samsung shipped around 60 million smartphones in Q1 2013.
Nokia's new Windows Phone flagship, the Lumia 925
Nevertheless, despite Nokia's seemingly precarious position, Microsoft may yet be forced to make an official move for the company if talk of interest from Huawei proves to be accurate.
The Chinese outfit which has set its sights on expanding its share in western markets already supports Windows Phone, but also has Android handsets on the market, with the risk of a Huawei-owned Nokia being forced to support Google's OS likely to bring Microsoft back into play.
[source: Wall Street Journal]
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US Correspondent
Representing the former colonies, Matt keeps the Pocket Gamer news feed updated when sleepy Europeans are sleeping. As a frustrated journalist, diehard gamer and recovering MMO addict, this is pretty much his dream job.
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