Microsoft’s $7 Billion Nokia Deal Drives Buzz Ahead of Berlin Consumer Electronics Fair

Courtesy of Zune
Microsoft CEO Steve Ballmer announced the Nokia deal late Monday night.

Taking a page from Apple's playbook, the software giant has agreed to acquire the devices business of the Lumia smartphone maker.

BERLIN – Microsoft’s deal to pay more than $7 billion for Nokia’s devices and services business is amping up the buzz ahead of IFA, the world’s largest consumer electronics fair, which kicks off Friday in Berlin.

Microsoft announced the mega-deal Monday night. It will see the Windows maker pay around $4.9 billion (€3.7 billion) to acquire Nokia’s devices business and a further $2.2 billion (€1.65 billion) for the rights to Nokia's patents. The agreement is the clearest sign yet that Microsoft is serious about taking on Apple as a maker of both software and hardware.

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Nokia was once the world’s largest handset maker but has struggled against falling market share with the rise of Samsung and Apple in the smartphone business.

With the just-announced Microsoft deal, this year’s IFA is stacking up as a showdown between former number one Nokia and new champ Samsung. Nokia is believed to be working on a series of new Windows-based devices, some of which could be unveiled in Berlin. Samsung, meanwhile, will official unpack its hotly anticipated new tablet, the Galaxy Note III, as well as its new smart watch, the Galaxy Gear, in a special pre-IFA press event in Berlin Wednesday.