Microsoft just licensed the Nokia brand to an unheard of Foxconn subsidary for $350 mn

Microsoft has reached an agreement to spin off its entry level smartphone devices to a FIH Mobile Ltd which is a subsidiary of Foxconn Technology Group and HMD Global. HMD will acquire the rights to use the Nokia brand on its products over a period of 10 years.While Nokia will not be investing in HMD, HMD will be paying Nokia royalties for using its brand name, patents, software and other properties. Nokia Technologies will be on the board of directors for the newly formed company. This is a way for Nokia to assure its customers that consumers will get the same experience and value from these new products, as they would have gotten from a Nokia device. Microsoft will meanwhile continue to manufacture its Lumia series of phones, as well as Windows Mobile.Ramzi Haidamus, president of Nokia Technologies, said, "Today marks the beginning of an exciting new chapter for the Nokia brand in an industry where Nokia remains a truly iconic name. Instead of Nokia returning to manufacturing mobile phones itself, HMD plans to produce mobile phones and tablets that can leverage and grow the value of the Nokia brand in global markets. Working with HMD and FIH will let us participate in one of the largest consumer electronics markets in the world while staying true to our licensing business model."This announcement signifies the return of Nokia branded devices to the smartphone market. HMD has exclusive rights to use the Nokia brand name locally, for the period of ten years. The deal is expected to be finalised in the second half of 2016. HMD plans to release Nokia branded smartphones, as well as tablets.