Nokia bets on IoT with SpaceTime deal as it searches for new growth areas
Nokia has acquired SpaceTime Insight, an IoT startup from California that uses machine learning algorithms to provide predictive analytics.
Deal value was not disclosed, but SpaceTime has raised between $50-$65 million in funding from backers including E.ON, Novus Energy Partners, and Zouk Capital. Notably, SpaceTime CEO Rob Schilling will become the new head of Nokia’s IoT unit, which currently is a small part of the overall company. The deal suggests that Nokia sees the Internet of Things as a viable contender as it searches for its next big growth area.
“Adding SpaceTime to Nokia Software is a strong step forward in our strategy, and will help us deliver a new class of intelligent solutions to meet the demands of an increasingly interconnected world,” Bhaskar Gorti, president of Nokia Software, said in a statement.
Less than a week prior to the deal, Nokia announced it is selling its health business after failing to develop this into a thriving offshoot.
“In its entirety, our Digital Health business has struggled to scale and meet its growth expectations. Currently, we don’t see a path for it to become a meaningful part of a company as large as Nokia,” read a memo from Nokia’s chief strategy officer Kathrin Buvac.
Nokia acquired the core of what is now its Digital health business in 2016 for €170 million, and announced that it had invested into the unit as recently as February 2017.
Nokia expects the Spacetime Insight acquisition to impact its IoT application roadmap within 18 to 24 months, meaning the new addition will be under pressure to perform from day one. The swift rise and fall of the health unit suggests that the Nokia environment is strictly “sink or swim”, meaning it’s not hard to predict what will happen to the new addition if it doesn’t perform as expected.
