Site icon Alan Mather – In The Eye Of The Storm

Nokia Bets On Red and Black

So Nokia plans to

a) Form a strategic alliance with Microsoft around Windows Phone 7 (one assumes for phones and tablets). Nokia expects to be able to direct development on this platform as well as bring some of its own technologies, such as Maps, into it

b) Maintain MeeGo, shipping product this year, and move it to an open source operating system

c) Keep Symbian alive, selling upwards of 150m units over the next few years, so that they can transition those customers to another Nokia platform

The rallying cry that comes with this wide-ranging, bet on every number, approach is:

– There are other mobile ecosystems. We will disrupt them.

– There will be challenges. We will overcome them.

– Success requires speed. We will be swift.

– Together, we see the opportunity, and we have the will, the resources and the drive to succeed.

The sceptic in me says that trying to keep everything going whilst simultaneously adopting a new platform is going to be very hard. After all, it’s a platform that is widely exploited by plenty of hardware-only manufacturers, such as HTC, who will also be able to exploit whatever results from this strategic partnership. I can’t imagine that Microsoft will branch their o/s and have a Nokia-only version of Windows Phone 7 and one (or more) for every other manufacturer. This probably makes Microsoft the winner out of this deal, even though rumour has it that they paid hundreds of millions to swing the decision.

This deal brings together a company, Nokia, who have proven history in shipping millions of physical product a year (and so who have a supply chain that is already well orchestrated) with, the phone above notwithstanding, a series of (near) first-of-their-kind innovations – camera phone, touch screen phone and so on; and a company, Microsoft, who have software that needs hardware that they can influence more and an entertainment division in Xbox – and, more recently, Kinect – that might provide a ready source of exclusive software that could differentiate their new partners hardware (notwithstanding that anything that works on a Nokia phone should also work on an HTC phone, assuming that HTC and the others don’t now vote just to work with Android). And, of course, if Nokia and Microsoft get this right then every Nokia-phone owning user will probably use Microsoft Office products in the cloud – and how many business people will end up buying (or having the corporation buy for them) a Nokia phone solely for that reason?

What is certainly true is that between Microsoft and Nokia there’s a lot of money, a lot of desire and a lot of smart people. It will be interesting to watch how this unfolds. Let’s hope it doesn’t result in a lot of wasted money, desire and talent – which could take a lot of time to become clear, by which time it will be too late for Nokia.

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