Windows Phone

Microsoft-Nokia deal: The challenges and opportunities

Microsoft and Nokia have joined forces in mobile in a move they are both counting on to get them back in the game. The deal raises some important and nefarious questions.

My cynical side would compare the newly-announced Microsoft-Nokia mobile partnership to an Olympic track race in which two of the tired runners that are fading from the front decided to hold hands until they get across the finish line.

While Friday's announcement about Windows Phone 7 on Nokia hardware may not be quite that irrelevant,  it's also not the immediate game-changer that others would like you to believe. It's certainly doesn't transform the smartphone market into "a three horse race," as Nokia CEO Stephen Elop said on Friday. Nevertheless, there are a few interesting possibilities.

The partnership

Before we get ahead of ourselves, let's sum up what Elop and Microsoft CEO Steve Ballmer have actually agreed to:

  • Windows Phone 7 will become Nokia's primary smartphone platform
  • Nokia will contribute to Windows Phone 7 hardware development (help Microsoft developers better optimize their software for telecom)
  • Nokia will bring WP7 to "a larger range of price points, market segments and geographies" (translation: low-cost replacements for today's feature phones and more devices in the developing world)
  • The Microsoft Marketplace (app and media store) will absorb Nokia's current apps and content (the Ovi store)
  • Nokia phones will use Microsoft's Bing search engine, Zune music store, Xbox Live gaming center, and will jointly focus on future services to expand the capabilities of mobile devices
  • The deal is not exclusive; Microsoft will continue to have other hardware partners and Nokia will still make a few Symbian and Meego devices

Here is a 12-minute video clip of the comments made by Elop and Ballmer to kick off the deal:

Here are the concept designs for Nokia's first Windows Phone 7 devices:

The challenges and opportunities

Let me start by saying that Nokia is still one of the world's great mobile hardware makers. Its devices have fantastic screens and excellent cameras, plenty of high-end features, and terrific hardware design. I would argue that Nokia is consistently as good or better than HTC, Samsung, LG and Motorola and nearly in the same league as Apple, when it comes to producing attractive, durable, and well-designed hardware.

The problem with Nokia, as I've been saying for years, is that their software is no where near the high standard of their hardware. As smartphones transitioned into pocket computers in recent years, Nokia phones have fallen desperately behind in software. Elop confirmed that sentiment in his now-famous burning platform memo on February 8 in which he wrote, "The first iPhone shipped in 2007, and we still don't have a product that is close to their experience. Android came on the scene just over 2 years ago, and this week they took our leadership position in smartphone volumes."

Nokia needed a bold move in the software/OS/platform area in order to become a mobile leader again. Hitching up with Windows Phone 7, which just debuted last fall, is definitely bold. However, the move raises a hell of lot more questions than it answers.

Here are some of the challenges I see:

  • Why not Android? - Nokia has admitted that when it went shopping for platforms, it was courted by both Google and Microsoft. On the face of it, Google's Android would have made a lot more sense. Nokia was already working with an open source OS in Symbian. Since Android is open source and more malleable than WP7, Nokia could have morphed it and integrated a few of the good things it was already doing in Symbian. Instead, Nokia picked a single platform and chose Windows Phone 7, an uncertain OS that has its merits but is not even a sure thing to survive the mobile platform wars of the years ahead -- even with Nokia's support. Leading up to this decision, ZDNet's Larry Dignan and I talked a lot about what Nokia might do and that the best move would be to just become an awesome mobile OEM and support both Android and Windows Phone 7. I still agree with that. In the short term, going exclusively with WP7 will likely cause Nokia phone sales to plummet even further in the market share race as traditional Nokia fans flee the flock. Fewer would have fled if Nokia offered Android phones.
  • What happens to the other WP7 partners? - Remember that this deal does not make Nokia the exclusive hardware maker for Windows Phone 7, but it appears to give them favored status. What will that mean for Samsung, HTC, LG, and Dell? Will they be even less likely to put much energy into the WP7 ecosystem? Besides Dell, the other three have certainly put a lot more emphasis on their Android devices. At CES 2011, they showcased their Android gear front-and-center while WP7 devices were mostly shuffled to the side. These OEMs seem to be using WP7 as a hedge against Android so that if Google gets too pushy they can always threaten to put more of their resources into WP7. The Nokia deal will likely keep them focused on Android with WP7 a second-class citizen.
  • What about Microsoft's reputation in Europe? - Nokia is a European company and Europe is the where it has its biggest fans and it greatest strength in market share. It's no secret that Europe does not like Microsoft. The European Union has been a constant thorn in Microsoft's side because of its Windows and Office monopolies on PCs and European companies have generally been a lot more aggressive about adopting open source, especially where it can replace Microsoft solutions. With the switch to WP7, Nokia will likely push a sizable chunk of its customers into the arms of Android and iPhone.
  • Where's the scrutiny for Stephen Elop? - One of the main reasons Nokia chose Windows Phone 7 over Android is that Microsoft reportedly paid hundreds of millions of dollars to make its mobile OS the primary platform for Nokia smartphones. Also, remember that Elop is a former Microsoft executive, so him siding with his old cronies is no surprise -- even though Elop vehemently denies that he's a Trojan Horse for Microsoft. However, it is a big surprise that Elop has not come under greater scrutiny for the deal, especially from the Microsoft-bashing EU. After all, Elop is still a big shareholder in Microsoft so he is deeply vested in helping his old company continue to succeed, and that is a massive conflict of interest. When challenged on this issue, Elop said he will soon sell all of his Microsoft shares, but that's little comfort since the deal is already done. I don't think we've heard the last of this conflict of interest.

Now that we've run down the challenges, let's talk about a couple of the opportunities:

  • A feature phone feast? - When Microsoft first released Windows Phone 7 I heard a lot of talk coming out of Redmond that the company wasn't trying to just butt heads with Apple and Android but wanted to make a platform that could be used to replace the larger market of feature phones (or "dumb phones" -- the old flip phones and candy bar phones) in the next few years. At the time, I didn't get it. After all, initially WP7 devices cost as much as Android and iPhone and still required a data plan ($20-$30 more per month than a standard cellphone plan). However, Nokia remains a powerhouse in feature phones and if transitions those devices to WP7 and when data becomes a lot cheaper and simply merges into standard cell plans in the next few years then WP7 on Nokia could grab a big chunk of market share in the low end of smartphones.
  • A play against Android's weaknesses? - Android has a number of problems right now - platform fragmentation, inconsistent updates and versions across devices, and "bit rot" (the OS becoming slower and more clunky over time - like Microsoft Windows, ironically). Windows Phone 7 has virtually none of those problems, at least not yet. If lots of buyers start to become frustrated with Android over these issues then Windows Phone 7 could become a legitimate alternative, and with Nokia and Microsoft joining forces on marketing and promotion of their devices you can bet that they will be looking for opportunities like these to jump on and present their devices as a friendlier alternative to Android.

Final thoughts

At the very least, the Nokia partnership will buy Windows Phone 7 a year or two to make its case as a legitimate alternative in smartphones. It will take some of the heat off of Microsoft for the lackluster sales of WP7 so far. Again, my cynical side would say that this move will prop up Windows Phone 7 for longer than the market would have naturally done it, and only because a former Microsoft executive is now running Nokia and pulled off a massive deal. Something about that stinks, and I expect Elop and Nokia will eventually attract more negative attention because of it.

The smarter move would have been for Nokia to support both Android and Windows Phone 7 and let buyers decide which one they preferred. Still, Windows Phone 7 has a chance to become the OS for low-end smartphones and Nokia's next generation feature phone replacements in the developing world. And, if Google doesn't fix some of Android's nagging problems, then Nokia and Windows Phone 7 could be well-positioned to offer an attractive alternative.

But, make no mistake, for now the Nokia/Microsoft deal is not much of a threat to the mobile momentum of Apple and Google.

About

Jason Hiner is the Global Editor in Chief of TechRepublic and Global Long Form Editor of ZDNet. He is an award-winning journalist who writes about the people, products, and ideas that are revolutionizing the ways we live and work in the 21st century.

57 comments
padapa
padapa

As someone that has worked in the smartphone applications market for 5 years, this is truly the worst decision that could be made. This is just pouring fuel on a flaming platform. 1) Nokia is now counting on Microsoft to deliver on something they haven't done in years, successful delivery of a mobile OS. Bad plan, even if Balmer is your buddy. It would have been much smarter to join forces with HP and use WebOS. 2) They just inflamed every Symbian developer in the world. Migrating apps from Symbian to WinMo7 is called rewriting the app from scratch, period. Don't get me wrong, I don't like Symbian, but the problem is Nokia's certification process ... every time you update or release an app, it costs thousands of dollars. Ditch that process and learn from Apple, Palm, and Google. Any developer can build an app. Also, Symbian was NEVER really opened up to developers. Last point on Symbian, It was behind 5 years ago when I started working with it, now it's just more behind. Meemo, WebOS, Android ... there are plenty of good choices, but WinMo7??? 3) Nokia should be firing every senior engineering and marketing manager that refused to change over the last 5 years. Having the same management means nothing has changed except where they point the finger ... Now they will point at Redmond, WA 4) Nokia's processes, attitudes and ability to listen to the end users is seriously broken and duct taping WinMo7 over top of things won't fix the underlying issues. Let me run things for a couple of years ... you'd see change ... lol 5) Nokia still sells billions in cheap, little flip phones ... the give away units. Apple and others are starting to eat into this market and Nokia only has a couple years to finishing turning this ship, so they better start using the money generated by the flip phones to create a position in the smartphone market worth having. padapa

sully2
sully2

This comment hits it on the head for me: "Thank you for purchasing a new home from us. Please note, you may only use locks from these approved vendors, appliances from our Reseller Portal website and are barred from doing any future renovations ever.. and no, you can't actually use the basement, that door will remain locked; only our approved technician may enter your home's basement.. and without prior warning or permission." I bought my Nokia N97 3 years ago and have never had a data plan. All of its features work independently from the cell phone provider. The cell phone is just another feature of the device. It is a stand alone Garmin GPS. It is a stand alone 5 MP camera. It is a stand alone PDA. It is a stand alone MP3 player. And no one (or cell phone carrier) is telling me what I can or cannot do with my device. I don't much care what operating system you put in it - just let me use it the way I want to use it. Symbian has not been a disadvantage to me, except when I see developers adding neat Apps for the iPhone, and ignoring the Nokia owners.

jkameleon
jkameleon

For the time being, I'm still Nokia fan, but I'd never, never, never carry Windows (or Apple for that matter) in my pocket. No way. If Symbian or Maemo lives, I'll stick with it. If not, I'll probably switch to Android.

marvin.novello
marvin.novello

It really is disappointing to read you sour-faced views about Microsoft. I haven't got any enthusiasm for reading any more of this guff. I expect this from young nerds who have only been involved in computing since 2008 and have not seen the big picture. Its very lazy to attempt to score points against Microsoft in this way. Maybe you think you are being "controversial" or "playing the devil's advocate". Its just lame in the end. It's more Apple flavoured bias than I can stomach and I have no interest in playing this game. Good luck with your career, doing Apple's bidding. Hope you remain in vogue at cupertino, but no-one really respects a sycophant. Signing out.

stuttgartt
stuttgartt

because it fits nicely in that otherwise useless little coin pocket of my jeans! Seriously though, I've been a Nokia owner since they produced a smaller phone than my old Ericsson 'brick' in the early nineties and I've never considered switching my brand until I read this article. Intellectually I know it makes no sense but as an European living in Oz since '92 I still retain my socially conditioned anti-Microsoft feelings.There's no doubt that a great many people will act impulsively off these strong emotions and will drop Nokia like a hot potato.

Justin James
Justin James

While WP7 may not have been the *best* choice for Nokia to partner with, Android was the worst possible choice. The problem is, there's no chance of differentiation. The market is saturated with Android phones. It's hard to stand out. There are a million low-end phones (which, incidentally, make Android look like an awful OS) and a pile of mid- and high- end phones too. Why go head to head against that? Meanwhile, in the WP7 market, there are a small number of phones, only two of which (the Focus and the Venue) which have any kind of "beyond basic" appeal. That means that it's wide open. Nokia could have attempted to become another "me too" player, or they could have chosen to blaze a new path. They had already been trying to become a "third horse" with MeeGo, to replace their current "third horse" status with Symbian. Maybe WP7 was the right choice, maybe it wasn't. Maybe they should have pushed ahead with MeeGo, I don't know. But trying to be a 30%+ player in the Android market is pretty foolish right now. Android itself is around 30%, so to keep their existing market, they'd need to get 100% of the Android market... impossible. J.Ja

Neon Samurai
Neon Samurai

It's a big double fisting to the existing communities and developers around Nokia products. Two weeks ago "sell the farm, move to the city.. make billions writting QT apps to run across all out Nokia devices and future Meego devices".. and with Elop's announcement came the sarcastic "Psyc!!!" after the pause. The play has been brilliantly executed by Microsoft based on what they gain by signing Nokia. The Business nerds have reason to admire it. Looks like I'm going back to a basic feature phone and seporate palmtop unless someone can actually improve on the N900/Maemo combination between now and when my humble device gives up the ghost. We'll see how the dust settles I guess.

jmarkovic32
jmarkovic32

Jason, I love your articles but I can't help but think that this article made a half-hearted attempt at being fair. Face it, this deal is good for both companies and once again people ignore Microsoft's staying power in established markets. Let's be honest here, Nokia smartphone hardware is basically non-existant in America and WP7 needs a European presence. This partnership is a good one and will prove to be significant in the smartphone arena. WP7 has a lot of promise although it doesn't make sense to me why MS abandoned the enterprise in this iteration of its mobile OS. People didn't hate WM because of its enterprise features, they hated it because it was unweildly and too complex with an outdated UI that came from the PocketPC era of styluses and IR. Once WP7 matures, MS has a unique opportunity to be the only platform that caters to both the consumer and enterprise markets. That's why I think this relationship is mutually beneficial. We tend to make the mistake of judging the future on the trends of the present which is a mistake. The enterprise is itching for a platform with the functionality for the enterprise and the ease of use for consumers. Don't underestimate Microsoft's staying power in established markets. Their Xbox product line is evidence of that. It went from being billions in the hole to single-handedly carrying Microsoft's E&D division into the black quarter after quarter.

Paulo Cezar
Paulo Cezar

As mckinnej said, Nokia definitely got the worst end of the deal. MS will sell more copies of WP7 and make more money and Nokia will only get angry customers. Elop may say he's not a trojan horse a hundred times but it still sounds like a lie to me.

daboochmeister
daboochmeister

Good analysis. I would add ... the Nokia competitors in their stronghold markets (India, Europe, China) will no doubt smell blood in the water, and leverage the lull and uncertainty between now and when the first WiNokia phone is actually available to steal market share. And, you can bet that they won't lead with their own WP7 models, after this announcement. Do you think there's any chance of EU intervention in the deal? Is that even possible? (Honestly not sure about EU jurisdiction) That first offering that comes from the this agreement had better be breathtaking ... it's going to have a lot riding on its back.

Ea Madden
Ea Madden

I understand how business relationships (bullets1-4 above) can position this partnership for greater market share (or not); yet, the only analysis directed at actual user experience has the MS product beating out the Android product (bullets 5-6 above). I'm not particularly an MS fan but, bottom line, users want ease of use, reliability and customer service when those aspects are found to be deficient. Seems to me you are saying MS wins in that arena.

tobynixon
tobynixon

As a project manager and a person who has been the victim of illegal search and seizure, Illegal access to my phone records and personal files by law enforcement, who have no reason to believe I am involved in illegal activity, my partners and law firms that I work for to protect their enviroments their work from federal survielance teams that patent or steal or seek to circumvent defense or civil court strategy. What is our market comming to when we have no choice than to buy communication devices that are set up to provide law enforcement with or without a warant access to our communications. That also allows criminal organizations access because they also can access it as well. I ask where is our privacy going? When police organizations and criminal organizations can simply use built in exploits by microsoft, apple, sprint and other companies without our knowledge. Do we have privacy? Do we have an expectation of privacy anymore? Yes! we certainly do, we have the right to be secure in person and property, but where does this responsibility fall? On the companies making these exploits, on our government for allowing it and on Techs like me who have to "illegally" modify devices on the market to not allow this kind of snooping and reporters like you to tell people that their devices have these exploits. Where is the market share for private devices? Where? When someone literally has to break the law to make a phone, a computer even a kindle, secure from access by these exploits!

mckinnej
mckinnej

Would have been important then. Now it's just a yawn. Nokia definitely got the worst end of the deal. They're going to be almost irrelevant now. If I were a Nokia stock holder, I would be upset.

Scottomatic
Scottomatic

The experience of the use of the phone in daily life is what will win the war. I just switched to Android from Windows Mobile, and barring a complete clunker in android development, I will not switch back. Bit rot isn't enough to change the game, as its so easily corrected by a quick factory default and restore of data to the phone. The Android interface is frendlier, more ergonomic, easier to use in general than Windows mobile. It runs leaner and faster on identical hardware when properly maintained. In my opinion Android will eventually lead the market and leave MS and Apple scrapping for 2nd and 3rd. Apple's presentation has alienated some people, and their method of sticking customers for every dime they can squeeze is what they previously most loved to point out about MS. If Android invests a litte more into its security integration with Exchange and othe rservices, they are poised to take customers from the RIM market as well. I think the Microsoft Nokia deal will likely not cause much more than a noisier scuffle for 2nd place.

khunter
khunter

even though it's the stripped-down AT&T E62 version, the Symbian OS has let me do everything and more. It took a month af research to find a smart phone with the features and call quality I expect.

Neon Samurai
Neon Samurai

It's just sad that there isn't another full distro option available from a vendor who tries to enable the own's choice to muck under the hood and have a full distro waiting. I've done the specialized OS for a specific mobile device and have really been spoiled by having a full distro on my device - and one so closely related to my other machines. No earth shattering PIM with sync capability beyond Windows/Exchange? No problem.. GPE on the device and my desktop with natural sync over ssh. Running the same audit tools I use on my other machines. I'll miss having that kind of freedom if Meego flounders and no one else delivers an alternative to the current three OS brand names.

AnsuGisalas
AnsuGisalas

Generation to generation, see how it goes.

Neon Samurai
Neon Samurai

What of old nerds involved in computing since Dos5 and who remember the early history and Microsoft's consistent behavior through the years? (ah.. and the usual.. mention Microsoft negatively and one must be an Apple shill.. no other possible explanation could exist..)

stuttgartt
stuttgartt

It really is disappointing to read your sour-faced views about anti-Microsoft. I haven't got any enthusiasm for reading any more of this guff. I expect this from older nerds who have been involved in computing since 1956 and still have not seen the big picture. Its very lazy to attempt to score points against anti-Microsoft in this way. Maybe you think you are being "arrogantly smug" or "playing the Gatesdevil's advocate". Its just lame in the end. It's more sour-grape flavoured bias than I can stomach and I have no interest in playing this game. Good luck with your career, doing your ego's bidding. Hope you remain in vogue at your house, but no-one really respects a smug egotist. Signing out before anyone disagrees with my opinion.

kaninelupus
kaninelupus

I'm a happy Windows user who is happy to admit have never had any inclination to go out and buy a Window Phone (nor any true smart-phone). To be honest, I find it utterly hilarious at the vast number of supposedly intelligent people going out and buying smart-phones of ANY caste who either a) don't actually NEED a smart-phone; b) have no idea how to even use 10% of the features of said phone; c) hove no inclination to even LEARN how to use said phone or d) only bought said device to look cool! So am not talking out of bias when I get frustrated by such small-mindedness. @Stutgartt; so you don't like Microsoft?? All evil-empire?? Let me ask you... when did Apple Corp suddenly become all hugs and kisses?? Google not stepped over some privacy line recently?? Opera taken anyone else to the EU recently because noone playing with its favourite child?? To be honest, there are really very few super-corporations around who have never crossed that thin ethical line from time to time... I'm not saying that to justify those behaviours but to highlight the fact that we'd be keeping ourselves in our own private dark-age if we excluded ourselves from every such example! This deal may actually work for both party... neither have really made a stellar entry into the smart-phone market, but pooling their ideas and expertise may strengthen BOTH players. It may prevent the virtual duopoly that exists in the PC market-place. Really though, it is simply too early to say.

Neon Samurai
Neon Samurai

Like other current vendors, Nokia could have customized the Android "experience" to differentiate. On higher end hardware, they could have shipped it with a full cli userland. They could have shipped frequent updates and major version updates as available from Google's devs. They could have done a clean QT/Ovi integration. Sure, they got a deal on WP7 and permission to customize it to differentiate from the rest of the WP7 OEMs.. and they publicly promised not to do so. "we promise not to take advantage of our one advantage in this deal". Oh well, least it's sprayed lost of drama into the news.. I'm getting popcorn.. anyone else want?

daboochmeister
daboochmeister

You're arguing that the delta extra value of some kind of "exclusiveness" relationship with MS will be greater than if they had simply decided to support both WP7 and Android, along with maintaining their low-end capability? Really?? That's ultimately what it boils down to. It's not like they're the only WP7 phone-maker either ... they might not end up at quite as much a "me too" as on the Android front, but they WILL to some extent be a "me too" there as well. I mean, how much can they really really differentiate from other WP7 devices via an MS relationship? The only scenario that makes any sense of this for me is if the end game is for MS to buy Nokia and make them their sole handset creator - the Apple model. Separately are you implicitly saying that you believe WP7 will "scale down" to low-end devices better than Android? Do you have any rationale for that? (just curious, I don't have any formed opinion on it).

AnsuGisalas
AnsuGisalas

Nokia's main squeeze is the third-world market; they sell low cost but reliable phones in gigantic amounts. Does WinPhone7 have a license cost? If it does, that's a death-knell to Nokia's third world business, cutting that market open like a blood eagle.

AnsuGisalas
AnsuGisalas

I'm not plugged into Nokia in any way or form, but I don't like the thought of what it will do to the neighbourhood if they're carved up like a school of pilot whales...

jasonhiner
jasonhiner

Microsoft helps Nokia in the US and Nokia helps Microsoft globally. At least in terms of distribution and go-to-market strategy, that's a fair point. But, WP7 is still playing catch-up to iPhone and Android from a product and ecosystem perspective, and I continue to hear about lots of enterprise trials of iPhone/iPad and Android. WP7 has a short-cut in the enterprise since there are a lot of IT depts that use Microsoft products, but more and more companies are choosing to stop provisioning smartphones (or cut back deployments) and simply let employees connect their own devices. That trend hurts BlackBerry and Microsoft and favors iPhone and Android. As for an Xbox-like outcome for WP7, that's a long shot. Xbox was able to leapfrog competitors (Sony and Nintendo) by getting its second generation hardware to market before they did. And even though Xbox 360 was riddled with technological problems, it was good enough that people stuck with it. In smartphones, Microsoft is last to market and there aren't the same generational jumps in hardware as there is in gaming so there's very little opportunity for WP7 to leapfrog unless its competitors make some big mistakes.

AnsuGisalas
AnsuGisalas

38% of the stock is US-owned, US investors demanded someone from the americas as CEO, and Elop the torpedo was the result. This was what was intended. I just hope someone will buy up the production sites in Finland, so we can still have phones that don't irradiate us all into baldness...

AnsuGisalas
AnsuGisalas

Not in the US at least. In the US, people buy what their carriers allow them to buy. It's that free market thing...

jmarkovic32
jmarkovic32

Why are people comparing Android to Windows Mobile when that platform is dead? WP7 is a completely new platform. Compare Android to it. Android is a gaudy and fragmented mess. It's like Linux nerds got together and made a phone. The only reason Android is popular is because it's been the only viable alternative to the iPhone (with RIM's stubborness to court the consumer market and Palm's crappy/limited WebOS hardware). With RIM continuing to be stubborn and HP shooting itself in its foot putting webOS on the same crappy form factors (a tiny Pre and a BIG Pre), MS/Nokia has a huge opportunity with Nokia's hardware prowess and Microsoft's software prowess.

jkameleon
jkameleon

For the reasons you've already stated.

seanferd
seanferd

"Waaaah." Yeah, I'm not sure where Apple came in at all. And while I don't much care for Google or Apple, neither has pulled the cr@p MS has. I'm still wondering what was so anti-MS about Jason's article in the first place, though.

Neon Samurai
Neon Samurai

At the cost of a fantastic existing OS they could have had to market this year and at the cost of customers who rely on that OS for lack of any comparable alternative. My grief is not because of a hate for Microsoft but use of a better alternative who's future is currently in question. Sadly, not such a shocking outcome with the first shoe dropping in last year's "we're merging our distro into Intel's" announcement. I just don't see WP7 providing the same owner access and software platform as Maemo and the other options have already proven to lack it.

Justin James
Justin James

Android is a study in contradictions... it's great that makers can do what they want with the interface, so they can differentiate. At the same time, it causes them and user and developers major headaches. I've owned a MotoBlur phone, and while I loved MotoBlur, I hated being cut out from upgrades for so long, to the point where I couldn't run a lot of apps because I had a down version of Android. HTC Sense is the same story. Android has a LOT of things like this (multitasking and the wide open market are two more great examples), where something that is a strong benefit is simultaneously a major problem. J.Ja

Justin James
Justin James

#1 There is no legal exclusivity on either side of this deal, my point was solely that the Android market is flooded, and it would be impossible for Nokia to maintain their current market share without capturing 100% of the Android market, which clearly won't happen. As Android gets bigger, that percentage would need to go down, of course. But by going with Android, it is impossible for Nokia to differentiate. Android is a purely price driven ecosystem. As long as a phone has the functionality and features you want (cameras, screen size/quality, keyboard, etc.), it's hard to distinguish them. Because the WP7 market is still wide open, there's a chance for differentiation. #2 WP7 *does* scale down to low end devices better than Android... MUCH better in fact, because it doesn't support multitasking. The multitasking in Android's weakspot in terms of customer experience (it's also one of its advantages on that front!). It's too easy to "exit" an app on Android and leave it running, that's why task killers are so common. Android is the first "mainstream OS" since Windows 3.X/9X where the average consumer needs to know how to force kill apps to make the OS work right... that's not healthy! J.Ja

Justin James
Justin James

WP7 does have a licensing cost, but Microsoft seems to have cut a heck of a deal with Nokia. Apparently, it's worth "billions" to Nokia, so I'm sure that the licensing is either significantly discounted, if not free. J.Ja

Neon Samurai
Neon Samurai

The failure was corporate execution not failing software. From what accounts I've found so far, Maemo is yet another technology run into the ground by crap management. For me personally, it's loosing a full feature distribution in my pocket along with the various third party .deb no longer maintained that I've collected (saved me hunting them down again after each of the first three Maemo firmware upgrades). It's loosing a full userland, python, ruby, cross-compiled cli applications. One can literally take a Debian source package, compile it into an ARM binary and install it. The folks at Debfarm do this very thing. With the Maemo to Meego merger, Intel/Nokia kept Intel's RPM base so that kind of sucks but as long as Apt and Aptitude and Debsum remain with rpm support.. not such a biggy.. better if they can install both .deb and .rpm on Meego. Downgrading to any of the other mobile platforms will probably involve me going back to featurephone/PDA combinations for lack of a Nokia N9?? with meego (maybe the one promised Meego device will be fantastic.. we'll see). The real tragedy is loosing a big backer for the most open and fully featured OS for mobile devices. Nokia is going to keep it on the side as a pet project; thankfully Intel looks to be pushing ahead and hopefully hiring lots of the developers Nokia will be walking out the door. Ios - perhaps the most locked down of the current mobile device OS. It goes out of it's way to limited the owner's access to purchased property. If it does what one needs then great but it doesn't do half of what I need. Heck, installing a proper userland is part of the jailbreaking process. Android - a stripped down Linux kernel with the minimum to support a Java VM; all GUI apps being Java applets at the most superficial level. Again, if it does what one needs then great but it's far from a fully stocked OS even if it derives it's kernel from one commonly used in fully stocked OS distributions. Userland under the cli is also an additional installtion (also aprt of the jailbreak process?). Not to mention the device/osversion/vendor fragmentation and slow, if any, updates without buying new hardware (unless one shells out for one of two Nexus developer platforms). The fact that there is a "jailbreak" process rather than simply a checkbox in the settings or easter-egg setting common to any device running the OS is a big neon blinking billboard pointing to the problem. A corporations bottom line is not more important than a device owner's access to there own property. "Thank you for purchasing a new home from us. Please note, you may only use locks from these approved vendors, appliances from our Reseller Portal website and are barred from doing any future renovations ever.. and no, you can't actually use the basement, that door will remain locked; only our approved technition may enter your home's basement.. and without prior warning or permission." Lest we forget the bait and switch that's resulted from Nokia's new management decisions. "love QT, bet your life on QT, we will deliver QT across our products and your code will right once run anywhere QT", "we support maemo through our further development of Meego, please contribute to our project, we promise we won't waste your time by arbitrarily changing our mind again in two weeks". So, Nokia becomes a hardware vendor selling the third - of three - OS in the mobile market which won't appear for another year or two in any products and which may or may not have an "ecosystem" grown up around it by then for lack of any significant one appearing so far. "our first priority is beating Android" - because doing something silly like selling Android based devices in the interim while getting a win7 device to market and continuing to develop our own future smartphone OS would just be silly and wouldn't alienate nearly as many of our existing customers. Here's hoping Intel can make a go of Meego cause it looks like mee go away from Nokia hardware unless they deliver a serious upgrade from the N900 platform. (at least in Palm's defense, they where beyond floundering when I left to nurse my T5 through until a real device upgrade became available.)

AnsuGisalas
AnsuGisalas

It's the truth. No help from there. It'd be different if Microsoft was a big player in the mobile scene, but they're not, and there's no change of ownership involved, anyway. The EU can't protect a concept like "open source phone software"... that's simply not in their charter.

Neon Samurai
Neon Samurai

A CEO does not make a decision like this without board approval but I'm still not sure how much beyond that is shareholders: Feb 11th 2011 down 16% day ending Feb 14th 2011 down 13.9% as of 15:00 I may not be reading the graphs right but that doesn't sound good at all. Especially for a company that employs such a large part of the Finish labour force.

Scottomatic
Scottomatic

So you think that because its Windows 7 on a phone, its no longer windows mobile? It still runs slower. Its still a pain to use compared to android. Ill say that Im a fan of Windows 7 on the desktop. All my PC's are running it. Microsoft just cant seem to put a great OS on a cellular device. And of course in response to your snarkiness, Android will be compared to anything Windows has available in the cellular market. It IS the same market after all. If you were going to dig a hole, would you use a shovel or a screwdriver? A shovel of course is the better tool, much like Android in the cellular market. MS should keep its screwdriver where it belongs.

Justin James
Justin James

... which is why they hijacked Android's open nature to make it closed in a way they felt comfortable with... :( If Nokia "did Android right" the carriers wouldn't get behind it. The Nexus One is a great example. Widely hailed as one of the best, if not the best Android device of its time, Verizon didn't care to touch it because it lacked the carrier tweaks that Motorola is delighted to shovel into the OS. J.Ja

Neon Samurai
Neon Samurai

Yet another UI without updates would be unfavorable fragmentation. That's why I include having them ship hardware open like the Nexus phones, shipping updates promptly and shipping upgrade firmware as available from Google. The issue I see with fragmentation now is caused by vendors driving for lockin with logic bombs in the boot strapping, a significant lack of updates and using firmware upgrades to push new device sales. Nokia could differentiate themselves by doing Android devices properly rather than like the bastard stepchildren we've gotten so far.

Justin James
Justin James

"by the same math, in order to to maintain their current market share based on WP7, they would need it the market to multiply 10-fold, AND they would need to own 100% of it." I think that it is much more realistic that trying to capture nearly 100% of the Android market. Look, you can't dodge the fact that it is impossible to be differentiated in Android. The last handsets in Android that anyone talked about were the Incredible/EVO (came out around the same time). Since then, Android's devolved significantly, no one cares about the devices anymore. But iPhone and RIM have both proved that a single manufacturer with a single or limited number of devices that fit each big price point can grow into a 30% market share with a one maker OS. And it's quite possible that Nokia can edge out the other WP7 makers, or eclipse them greatly, just as Motorola came back from the edge of dead with the Droid 1 to become the biggest Android maker around. "I still think there's a basic logic flaw in their approach. The only reason they can differentiate from other WP7 vendors now is because, like you say, the field is less crowded. But for their strategy to succeed, the WP7 market must grow hugely - and that will result in a crowded market, with Android-like limited ability to differentiate. Continuing to be able to differentiate will mean the market hasn't grown - which will mean their strategy has failed. A conundrum, wrapped in an enigma of a business plan ...." I hate to say it, but I *do* agree with this. Android was unique, different, and differentiated when there were only one or two Android phones on the market, all for relatively small carriers like T-Mobile. When the Droid 1 hit Verizon, it was a new, fresh experience, a premium device, on a top level carrier. The Droid 1 is the reason why Android is a success today. Everyone raced to fill the other gaps in the Android ecosystem (the landscape slideout keyboard is not a terribly popular design), and then people raced to make knockoffs of the market leaders... and now the market in Android is fairly bland. WP7 could very well go the same route. "As to WP7 vs. Android on low-end - you're talking theoretics, and a temporary difference, if your only relying on multitasking as the differentiator. Nokia has plenty of dev smarts to deal with that for Android (e.g., limiting multitasking); and WP7 is adding multitasking. Which is actually more resource efficient? (or, more importantly, which WILL be in a year, as the tide starts to surge in that arena -- let's not forget that release by release Android keeps benchmarking as significantly faster and more resource efficient)?" Those are all excellent questions. I'll say that *at the moment* WP7 blows Android away on the speed factor. I'm also wondering how WP7 will do multitasking. I will say that given the Microsoft testing that goes into allowing the apps into the marketplace (and as someone who has three WP7 apps published, I can attest to their stringent policies), I believe that the apps will be much better behaved. Also, the WP7 execution model is much tighter than Android's, and will provide a much better experience when multitasking comes around. Multitasking is not the only differentiator. The WP7 UI, regardless of how you feel about the color scheme or the "blockiness" to it, or other aesthetics, is provably easier and quicker to use. Everything is less gestures than Android, with more "clicks" and less "swipes" which makes WP7 a LOT easier to use one handed. I can't even read a text message on my Android phone if I can't use both hands, it is a snap on WP7. Even unlocking the screen is a better experience! But that being said, these are the kinds of differences that you don't really see until you've actually lived with a phone, as opposed to played with one at a store. I've had an Android phone for about a year, and for most of that time, I've wanted to turn it into a small pinata out of frustration. I've had a WP7 phone for about 2 weeks (less than 1 week with service connected) and it's blown me away with things like ease of use and lack of frustrations. But, I'll see how I feel about it in a few months. :) J.Ja

daboochmeister
daboochmeister

@JJa - by the same math, in order to to maintain their current market share based on WP7, they would need it the market to multiply 10-fold, AND they would need to own 100% of it. You think that's a more realistic business plan than a balanced portfolio, accepting 10 - 20% of the Android market, plus 40% of WP7? (to throw out numbers, which is of course pure speculation on what might have been possible if they diversified). I still think there's a basic logic flaw in their approach. The only reason they can differentiate from other WP7 vendors now is because, like you say, the field is less crowded. But for their strategy to succeed, the WP7 market must grow hugely - and that will result in a crowded market, with Android-like limited ability to differentiate. Continuing to be able to differentiate will mean the market hasn't grown - which will mean their strategy has failed. A conundrum, wrapped in an enigma of a business plan .... As to WP7 vs. Android on low-end - you're talking theoretics, and a temporary difference, if your only relying on multitasking as the differentiator. Nokia has plenty of dev smarts to deal with that for Android (e.g., limiting multitasking); and WP7 is adding multitasking. Which is actually more resource efficient? (or, more importantly, which WILL be in a year, as the tide starts to surge in that arena -- let's not forget that release by release Android keeps benchmarking as significantly faster and more resource efficient)?

AnsuGisalas
AnsuGisalas

Of course, billions could be kickbacks, or dreams of kickbacks founded on projected sales, projecting a continuation of present sales... which would be total pie-in-sky thinking if the low-cost mobiles go up in price... This would be nice to know!

seanferd
seanferd

I'm sure it will become a feature of the TR comments forum as well.

AnsuGisalas
AnsuGisalas

...alone, that is. Microsoft may be just the can-opener, getting a slice, and preventing someone else from getting it...

Neon Samurai
Neon Samurai

Nokia destroys it's stock prices, Microsoft obsorbs it at a bargain basement price. The theory actually came up pretty quick over talk.maemo.org way. At present, there seems a group of nine shareholders publicly denouncing the decision. Continueth, the drama and spectacle.

AnsuGisalas
AnsuGisalas

...from the inside. In fact, if you want to strip it, you need the price down. EDIT: It's pretty much a classic set-up, reallly. If someone is controlling Elop, they have much less than a majority, so the "value" they're throwing down the drain is mostly Other People's Money. Now, if Elop is doing what I fear he's doing, he's doing his job well... if he's deliberatly painting the past leadership as incompetent and deliberately generating bad press in all sorts of ways - ways that are not on-face-disruptive... The next step of the scenario will see the stock plummeting, then someone consolidates control, force-buy-outs the remaining stock, and carves up the company to sell at the black market for vital organs. The way it works is; dump the price now, it reduces their own worth, but in the long run they giving themselves a discount on the entire assets of Nokia. Kind of a nice stock option... talk about a five-finger discount.

Justin James
Justin James

Scottomatic - Windows 7 and WP7 have very little in common, other than the ability to run Silverlight applications. They look nothing alike, the UIs are nothing alike, and the binaries are nothing alike. Reality is, WP7's underpinnings are really a continuation of the Windows Mobile line, with a sandboxed Silverlight environment on top. J.Ja

Scottomatic
Scottomatic

So you think that the WP7 platform is not based on the Windows 7 desktop model? I hope you aren't in IT. Maybe you should be the one doing some more reading.

Miguel Chillitupa
Miguel Chillitupa

I think you are missinformed... Windows Phone 7 is not the same thing that Windows 7, is another thing, totally different... So, please, get the rigth information before making a opinion...