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Nokia Targets the Smart Home with Withings Acquisition

Two years after ditching its cellphone business, the Finnish software company is getting back into digital devices with a heavy mHealth play.

By Eric Wicklund

- Nokia is going all in on the Internet of Things.

The once-struggling Finnish cellphone company said it’s targeting mobile health – projected to be the fastest growing healthcare segment through 2020 – in its purchase of Withings, a French-based developer of smart devices including activity trackers, smartwatches, scales, thermometers, blood pressure monitors and more than 100 corresponding mHealth apps.

Nokia is paying $191 million in cash for Withings, which will become part of the Nokia Technologies unit. The deal is expected to close in the third quarter.

"We have identified digital health as a key for us. It fits the company, not just strategy of playing in the internet of things (IoT) space, but of connecting people to health and guiding them to healthier and happier lifestyle," Ramzi Haidamus, president of Nokia Technologies, told CNBC. "What Withings provides us is with is an accelerated pace into the market, an outstanding team, a great product portfolio … and great insight."

Nokia Technologies is split into two divisions – a health and wellness unit focused on apps and analytics and based in Silicon Valley, and an inpatient care technology unit based in Finland.

Once touted as the world’s biggest cellphone company, Nokia fell on hard times and sold its hardware business roughly two years ago to Microsoft. The Withings deal is generally seen as a return to form for the company, who wants to be a key player in the IoT universe built around health- and wellness-related smart devices in the home.

“We have said consistently that digital health was an area of strategic interest to Nokia, and we are now taking concrete action to tap the opportunity in this large and important market,” Rajeev Suri, Nokia’s president and CEO, said in a press release. “With this acquisition, Nokia is strengthening its position in the Internet of Things in a way that leverages the power of our trusted brand, fits with our company purpose of expanding the human possibilities of the connected world, and puts us at the heart of a very large addressable market where we can make a meaningful difference in peoples’ lives.”

“We’re now starting a new chapter as a company, this one focused on connecting you to better health through technology,” Haidamus added in the press release. “We aim to help you lead a happier, healthier life through the kind of beautifully designed products that you expect from Nokia. To help us do this as fast as possible, we will be welcoming Withings into the Nokia family. A leader in digital health products and apps designed to improve everyday well-being and long term health, Withings will combine perfectly with Nokia’s heritage of mobility and connectivity.”

Withings was launched in 2008 by Eric Carreel and Cedric Hutchings.

“Since we started Withings, our passion has been in empowering people to track their lifestyle and improve their health and wellbeing,” Hutchings, the company’s CEO, said in a release. “We’re excited to join Nokia to help bring our vision of connected health to more people around the world.”

Both companies are well-known in mHealth circles. Withings, long one of the known names in the wearables market, most recently participated in a national home blood pressure monitoring study conducted by the American Medical Group Foundation. The home patient monitoring project’s success at the Billings Clinic in Montana was profiled in a recent mHealthIntelligence.com article.

In 2012, Nokia sponsored the Nokia Sensing XChallenge, developed in conjunction with the XPRIZE Foundation. The two-stage $2.25 million competition sought out hardware sensors and software sensing technology that could help consumers and healthcare providers improve health outcomes. In 2013, Boston-based Nanobiosym Health RADAR won the first stage with a consumer-facing sensor that analyzes a drop of blood, saliva or body fluid within an hour for presence of disease pathogens. In 2014, the Cambridge, Mass.-based DNA Medicine Institute (DMI) won the second stage with a sensor platform designed to runs hundreds of lab tests in the field on a single drop of blood.

The Nokia Sensing XChallenge was run concurrently with the Qualcomm Tricorder XPRIZE, a $10 million competition to create an all-in-one mHealth device similar to the Tricorder of Star Trek fame. The final phase of consumer testing is scheduled to begin this September, with a winner named sometime in 2017. 

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