Home / Companies / In India, Microsoft starts global rebranding of mobile outlets

New Delhi: Exit Nokia Priority stores. Enter Microsoft reseller stores.

Redmond, US-based Microsoft Corp., which acquired Finnish firm Nokia Oyj’s mobile handset business for $7.2 billion last year, has started a global rebranding of its retail outlets, starting with India, which hosts nearly half of all such outlets.

The Nokia Priority stores will now be rebranded Microsoft Priority Resellers and Microsoft Mobile Resellers. The company launched the first branded store in India on Tuesday.

The rebranding of about 16,000 outlets across the world, including about 9,000 in India, will be completed by June-end, said Chris Weber, corporate vice-president (mobile device sales), Microsoft.

Microsoft, which rebranded Nokia Lumia phones as Microsoft Lumia phones after the acquisition, has struggled to attract customers to its Windows Phone platform.

The mobile phone operating system (OS) market is led by Google Inc.’s Android, followed by Apple Inc.’s iOS. In the fourth quarter of 2014, Windows Phone had a mere 2.8% share of the global mobile OS market, according to a February report by International Data Corp. (IDC).

However, Microsoft isn’t discouraged: On Tuesday, the company said it is looking at a two-fold strategy in India—roll out more affordable and mid-tier phones, and re-enter the premium market with its upcoming Windows 10 phone platform.

India will see more than half of the total investment in rebranding, said Weber, who was executive vice-president at Nokia’s global sales and marketing division until its acquisition by Microsoft in April 2014.

“We are investing in India more than anywhere else in the globe to do that rebranding. It shows our perspective," said Weber. He said the company has consciously focused on affordable phones to build volumes in the country.

In October, Microsoft started rebranding Nokia phones as Microsoft phones. India remains a priority market for the US-based company, which made the global launch of its Lumia 533 model in November in India, priced at 9,199. The firm hopes to load its upcoming high-end phones with Windows 10, said Weber, without setting a date for the release of the much-awaited phone platform.

“Windows Phone had the smallest year-over-year increase among the leading operating systems, growing just 4.2%, well below the overall market," the IDC report said. “Having finalized its acquisition of Nokia in the spring of 2014, Microsoft relied primarily on a long list of entry-level Lumia devices to maintain its position in the market, and relied on partners HTC and Samsung to provide cover on the high-end of the market. With the launch of Windows 10 later this year, Windows Phone stands to make a more concerted effort to return to the high end of the market."

The rebranding has the potential to be a strategic move for Microsoft, said Sanchit Vir Gogia, chief analyst and chief executive officer, Greyhound Research, who called it a “much-required" step. “Albeit, the decision has come late, the Indian market is still being shaped up—Tier II, III & IV markets are still far from being penetrated. Microsoft has the channel relationships to be able to push this to the market aggressively."

“Apart from hardware, this is also a competition of the broader OS and availability of the local apps," he said. “To compete in this battle, it will require back-breaking work from Microsoft to give solid competition to Google, iOS and Blackberry in their well-established turf."

Microsoft is also evaluating India for opening up new manufacturing facilities, Weber said. Nokia’s Chennai plant, which was embroiled in a tax dispute, was not part of the global acquisition.

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