Nokia Oyj was the world's leading mobile phone maker until it suffered a humiliating collapse after underestimating the appeal of smartphones manufactured by Apple Inc and others. Now, Nokia seems to have made a similar miscalculation in smart watches.
Nokia announced plans to sell a digital health business that it acquired two years ago to capitalize on the popularity of portable fitness trackers such as those manufactured by Fitbit Inc. Since then, however, device manufacturers have struggled as competitors such as Apple. It has similar characteristics in its smart watches.
Nokia entered the mobile device market "as it was undergoing a transformation," said Ramón Llamas, director of mobile device research at IDC in Framingham, Massachusetts. Consumers can use their smart watches for a wide variety of functions that go beyond the capabilities of Fitbit style trackers. "People say, 'The smartwatch looks pretty clean, I do not need an exercise tracker,' said Llamas.
Nokia said it is selling the digital health business to Eric Carreel, co-founder and president of Withings, a French startup that Nokia acquired in 2016 for 170 million euros ($ 204 million). Withings technologies formed the backbone of the Nokia unit, which has been promoting a cardiac and activity activity clock and an 'intelligent scale' that transmits data on body composition and heart rate.
In October, Nokia withdrew the sale of 141 million euros and CEO Rajeev Suri said he wanted to focus less on small-scale consumer products and more on the company's wireless networking and patent licensing business.
The failed attempt to enter health points connected to stiff competition in an industry where giants like Google of Alphabet Inc. are investing heavily. Google announced this week an agreement with Fitbit that will use Google's artificial intelligence software and the cloud platform to develop its portable devices.
Nokia smartwatch business, portable devices, Fitbit, CEO Rajeev Suri, cloud platform, Google, fitness monitors, artificial intelligence platform Nokia Oyj was the dominant mobile phone manufacturer in the world until it suffered a humiliating collapse after underestimating the attractive of smart phones manufactured by Apple Inc. (Stock Photo)
The sale of the digital health unit could also eliminate an area of possible friction between Nokia and several companies that license their patents to manufacture their phones and tablets. After Nokia reached an agreement in its legal patent battle with Apple a year ago, the technological giant of EE. UU He brought back the company's digital health products in stores and online. Apple had taken those products during litigation.
Nokia said it expects an agreement to close the sale of the unit by the end of the second quarter of this year.