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Nokia: Microsoft Is NOT Buying Our Smartphone Division

In an interview with PC Magazine, Nokia CEO Stephen Elop said that the rumor about Microsoft purchasing Nokia's smartphone division is completely bogus. He said the rumor likely surfaced because "some people" are running out of fresh material, and enjoy generating rumors.

The "some people" reportedly refers to Nokia watcher Eldar Murtazin who surmised that Microsoft plans to purchase Nokia's smartphone division based on a report released by Danske Bank last week.

"The deal will be announced in the first half of 2012," he said via Mobile Review. "I assume Nokia’s management is trying to reach a critical point when selling the company out will be the only option. Many Nokia’s top managers hail from Microsoft and judging by their decisions they are still loyal to MS. I cannot see any attempts of trying to save Nokia."

However Elop painted a different picture in the interview. "There's significant synergies between the multiple groups within Nokia—for example, on decisions around chipsets, on memory, on different display technologies," he said. "We gain scale advantages across the entire portfolio of devices that we have."

"In a number of the services and areas where we differentiate, [for instance] location-based services, we have a common team that's doing that work collectively across mobile phones and smart devices, so there's a lot of synergy that exists across the portfolio of Nokia products," he added.

The point he was trying to make is that it wouldn't make sense to sell to Microsoft based on all that scale advantage and multi-department synergies. The scale he refers to has helped Nokia corner the market in the past, especially in developing markets. Microsoft is likely using Nokia to get Windows Phone out to as many consumers as possible, especially if Nokia can push devices at super-low price points.

On Wednesday Nokia's first Windows Phone in the States finally went on sale, the Lumia 710 on T-Mobile, for a super-low price tag of $50 with a new two-year contract.