Is this the beginning of the end of Nokia Corporation (ADR)(NYSE:NOK)? The Finnish mobile phone maker has announced that it will sell its cross-platform application framework Qt to Digia Oyj. No financial details were disclosed. Nokia is also selling more than 500 of its patents and applications to Vringo
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Qt Quick, acquired when it bought Trolltech ASA in 2008, it was meant to be a long-term strategy in Nokia's arsenal as an application platform for fast UI creation. Its aim was to make high-quality apps for its two mobile platforms, MeeGo and Symbian.
Since applications are what are driving the usage of smartphones as Android has cleverly found, Nokia's purchase of Qt was recognition of that fact.
Bloomberg reported that "now that Nokia has all but abandoned the platforms in favour of their Windows Phone development with Microsoft, Nokia does not need to continue to offer its own apps platform. As many as 125 Qt employees will move to Digia Oyj as part of this sale."
“With Nokia smartphones relying on Windows-based applications, which are rapidly increasing in number, Qt no longer has a role to play in Nokia’s smartphone efforts,” Janardan Menon, an analyst at Liberum Capital, told Bloomberg. “Nokia is keen to restructure, to squeeze out margin as well as improve cash where possible.”
Nokia has lost its leadership in the smartphone segment to Samsung and Apple, both of which are rapidly upgrading and updating and making sure that their uses have pent of apps to keep them occupied.
Meanwhile, Nokia is also rumored to be launcing a new slate of Windows Phone 8 devices in September and is expected to release at least one of them before the end of 2012. Speculation is rife that one of them could be a tablet.
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Apple, it may be recalled, is releasing its iPhone 5 on September 12.
Shares of NOK are down 6.15% to $2.75 after soaring over 9% in the previous trading session. The stock gas recovered 69% from its more than 15-year low of $1.63 made last month. The stock may face resistance at $3, while support could be seen at $2.30.