Nokia and Microsoft Team Up in Smartphone Battle

[supmango]

This may be the beginning of the end for Nokia. Too bad really, because my first phone was a Nokia and it was great. They just failed to innovate at all since then (1998).

Really, I can't say that I blame Nokia at this point. They are already so far behind the ball, and Microsoft talks a big game. Who knows, over time maybe Microsoft will manage to make something competitive out of their revamped Windows Mobile os. I think it is more likely that we will see a gradual degradation in performance with each "service pack" like we get with all their other operating systems.

This is definitely a great deal for Microsoft, because Nokia clearly has the history with mobile devices.

 

[SnoFlo]

I used the Nokia E71 and I now use their flagship N8. I use the iPod Touch as well. Nokia's hardware, at least on these phones, is superb and the camera is the best available for a phone.

Symbian is indeed archaic, but it is stable and rarely crashes, at least with me. However, the main problem is the entire app situation: nobody develops apps for Symbian and the apps available at the Ovi Store can be buggy and frustrating to use. I feel like I'm part of some kind of fringe community: no medical apps at all and, heck, I had to hunt around forums etc. just for a half-baked eBook reader. I really believe Nokia had no choice here. Even if they got MeeGo going how long will it take for a decent number of apps and other support to appear? Too long.

I wish them luck.

 

[LagunaSol]

If they went Android, they would have been another "me too" phone maker.

Why is it people don't understand that WP7 phone makers are "me too" phone makers, just like in the Android world?

Even though implementing it immediately would give Microsoft over 31% of the world smartphone OS share, Android is still a few points higher at 33%.

It still would put WP7 on twice as many handsets as iOS (16%) or RIM (15%).

Microsoft scored huge with this.

Pfft. As much as Microsoft loves to bulldoze its way into markets by hook, crook, or bribe, this deal hardly makes Microsoft a major contender. In the new smartphone world, people don't buy devices, they buy platforms.

Nokia has just turned itself into a generic hardware factory for Microsoft's failing mobile platform. Seeing the Nokia name on a chunk of plastic isn't going to draw people to WP7 by default, as much as Microsoft (and Nokia) wishes it were so.

Times have changed. Thankfully.

 

[Carniphage]

Why is it people don't understand that WP7 phone makers are "me too" phone makers, just like in the Android world?

Nokia has just turned itself into a generic hardware factory for Microsoft's failing mobile platform.

The biggest difference between Android and WP7, is that Microsoft can refuse licensees.

Anyone can grab a build of Android and stick it into their hardware. So any no-name Chinese manufacturer can match you feature for feature.

Both platforms are licensed, but Android is definitely the high speed route to commodity status.

C.

 

[gnasher729]

Really? Nokia sell the most smartphones in the world. Though their market share is falling fast.

I'd rather Nokia continue with Symbian until Meego is ready and build from there. But, the timeframe for this is too long. I feel Nokia are keeping Meego around in case WP7 venture fails.

For some interesting take on the news, read http://www.theregister.co.uk/2011/02/11/nokia_microsoft_history/ .

One point the author makes is that Nokia _believed_ they sold most smartphones. But what actually happened is that most people buy cheap dumb phones (from Nokia), and a few people buy expensive (dumb phones) from Nokia, because they can afford it. And because those expensive phones were classified as "smart phones", Nokia believed they were the market leader. They were not. They sold (and still sell, just barely) the "largest number of phones classified as smart phones by analysts", but they don't sell the largest number of phones used as smart phones.

The only ones selling real smart phones right now are Apple, RIM, and the various Android makers. And a tiny, tiny number of Windows smart phones. And RIM, I think, makes phones that are not _quite_ as smart as iOS and Android, so they might be in trouble soon as well.

Ooops, I spoke before checking! Correction:

Even though implementing it immediately would give Microsoft over 31% of the world smartphone OS share, Android is still a few points higher at 33%.

It still would put WP7 on twice as many handsets as iOS (16%) or RIM (15%).

Microsoft scored huge with this.

I don't think so. Nokia so-called "smart" phones are bought today by people who want a _nice_ dumb phone and not a cheap ugly dumb phone, and who can afford to pay a bit more. They are not in the same category as iOS and Android, nowhere near. If these people wake up and want a real smartphone, they will go to iOS or Android. Now if all these Nokia phones suddenly had WP7, that would be a wakeup call for those customers. They would be woken up to the world of smart phones, and in that world iOS and Android are at the top; WP7 is nowhere. Anyone they ask for advice will either tell them very strongly that they should buy an iPhone if they want a smartphone, or advice them very strongly that they should buy an Android phone. iOS, Android, and to some extent RIM, will catch 90% of the customers who switch from a nice dumb phone to a real smart phone.

 

[rdowns]

So, what happens when phone companies get into bed with Microsoft?

Tech watchers with long memories -- like Asymco's Horace Dediu -- will recall that this is not the first time Microsoft has found a partner willing to help it try to extend its desktop operating system monopoly into cellular telephony.

How did those deals turn out? The summaries below are excerpted from an item Dediu posted Friday. Click here to get the full flavor of his skepticism.


Ericsson (ERIC). Sept. 2000. What happened?
Ericsson divested itself of the mobile division, forming a joint venture which would go on and make more strategic alliances with Microsoft over Windows Mobile, culminating in a loss of profits and eventual flight to Android.

Sendo. Feb. 2001. What happened?
Sendo, after litigating IP issues with Microsoft, went bankrupt in 2005.

Motorola (MOT), Sept. 2003. What happened?
Motorola launched a series of Windows Mobile phones culminating in the Motorola Q "Blackberry killer." As Motorola hit the rocks in profitability, new management reached for the Android life raft. The company now relies exclusively on the Droid franchise.

Palm (HPQ), Sept. 2005. What happened?
Palm shipped a few Windows Mobile, famously dismissing Apple's potential entry as something "PC guys" could never achieve. A new CEO, a private placement and an acquisition later, the company is a division of HP making its own operating system.

Nortel, July 2006. What happened?
Nortel declared bankruptcy two years later.

LG, Feb. 2009. What happened?
LG made a few Windows Mobile devices but with WinMo uncompetitive, they abandoned the platform and moved to Android, losing years of market presence and all their profits.

Verizon (VZ) Jan. 2009. What happened?
Bing did ship on some devices, but in October 2009 Droid came to Verizon.

And finally,

Nokia. No, not this deal, but the Aug. 2009 plan [announced by then Microsoft business division president Stephen Elop] to bring Microsoft Mobile Office to Nokia's Symbian devices. What happened? Two and a half years later the same Stephen Elop [now CEO of Nokia] announced that Symbian will be deprecated.

Link

 

[Carniphage]

So, what happens when phone companies get into bed with Microsoft?

Eek!. It's like marrying a serial killer.

One minute you're skipping down the aisle....
Next minute your torso is in a duffel bag on the side of the road.

C.

 

[OllyW]

Nokia. No, not this deal, but the Aug. 2009 plan [announced by then Microsoft business division president Stephen Elop] to bring Microsoft Mobile Office to Nokia's Symbian devices. What happened? Two and a half years later the same Stephen Elop [now CEO of Nokia] announced that Symbian will be deprecated.

Is it February 2012 already?

 

[tigress666]

I think it is a good move on both their parts.

Nokia does have a good reputation for their hardware (before I bought the iPhone I'd insist on a Nokia phone cause in my experience they were really tough). And while Windows is late to the game with 7, it seems many people do seem to like 7 (but cause it's so late it's having a hard time gaining ground). But Nokia seems to have a bad reputation for it's smartphone OS.

So this might be the leg up both groups needed (MS having Nokia's loyal "fanbase" and Nokia getting an OS that isn't seen as sucky though in my opinion I still don't understand why people like Windows Mobile 7, I even prefer MS's earlier mobile OS's to tell the truth).

 

[TennisandMusic]

Based on the derision and anger in this thread I'd say there is some fear in some of the diehards. WP7 is pretty solid. They need to do a better job with updating it, but it's a strong OS.

The fanboyism in here makes me kinda hate carrying an iPhone. I think some of you guys need to grow up.

 

[Stella]

I disagree - having owned a Symbian Nokia phone - it was very capable and had functionality that the iPhone could not do, and can still cannot do.

Nokia Symbian smartphones ARE real smartphones, no matter what people think on this forum.

Sure - people bought Nokia smartphones and didn't use them to their full advantage, but that doesn't make them any less than a smartphone.

People would agree that a phone that can multi-task, exchange data with a computer, run native applications ( not just Java apps ) , email, internet, IM, navigation, etc etc can be defined as a smartphone.

The only ones selling real smart phones right now are Apple, RIM, and the various Android makers. And a tiny, tiny number of Windows smart phones. And RIM, I think, makes phones that are not _quite_ as smart as iOS and Android, so they might be in trouble soon as well.

 

[1984app]

Music???

Is it just me or does anyone else find it ironic that they used the music from the Apple Unibody Video???

It is a free Jingle included in Garage Band (Pendulum), so this was obviously made on a mac. It looks live the video was made in iMovie. Man Nokia must be hurting for cash.

Expected from Nokia but not in a video where they are partnering with Microsoft.

 

[Carniphage]

I disagree - having owned a Symbian Nokia phone - it was very capable and had functionality that the iPhone could not do, and can still cannot do.

Engineers have always thought they could add value by adding functionality.
But functionality does not equate to value.

Experience is what adds value.

C.

 

[Centient]

Those folks have had a 3 years opportunity, and $10B to get their house in order.

And all there was to show for it was an incomplete tablet OS and a cellphone OS with the worst user experience in the world.

I think they have gotten off lucky.

C.

Those folks are human beings and employees of a company that fell into a rut with a corporate culture that was unwilling to acknowledge that the world was changing and they needed to catch up. Like most of us, they are not the masters of their own destiny. To write them all off as laggards or incompetents is a pretty broad brush stroke.

More to the point, that's thousands of people out of work in that countries single largest private employer. That is sad.

 

[gkarris]

This may be the beginning of the end for Nokia. Too bad really, because my first phone was a Nokia and it was great. They just failed to innovate at all since then (1998).

Really, I can't say that I blame Nokia at this point. They are already so far behind the ball, and Microsoft talks a big game. Who knows, over time maybe Microsoft will manage to make something competitive out of their revamped Windows Mobile os. I think it is more likely that we will see a gradual degradation in performance with each "service pack" like we get with all their other operating systems.

This is definitely a great deal for Microsoft, because Nokia clearly has the history with mobile devices.

Well said...

I was saying that Microsoft is the one who has benefited from this over Nokia...

 

[kdarling]

I don't think a lot of us will be holding our breaths for Microsoft to deliver compelling or innovative OS.

Microsoft has already delivered an innovative OS, compelling enough to get consistently high marks even from jaded journalists.

iOS is a dirt simple to use, one icon/app/action at a time system. That's part of its popularity, but it's a very early 1980s style.

WP7 is also simple to use, but is more data and activity centric. As compared to all other popular mobile OSs, it's unique.

 

[Stella]

Engineers have always thought they could add value by adding functionality.
But functionality does not equate to value.

Experience is what adds value.

C.

The money I spent on my Nokia smartphone was absolutely worth every cent.

Nokia Symbian smartphones ARE smartphones, absolutely no doubt about it and I don't understand why anyone would think differently.

Nokia Symbian phones are universally regarded as Smartphones ( apart from the tiny minority )...

http://en.wikipedia.org/wiki/Symbian
http://en.wikipedia.org/wiki/Smartphone

 

[SnoFlo]

^^ Uh, yeah, I was wondering about that. So what's a real smartphone then? I can't think of anything I can't do with the N8 that requires me to own an iPhone instead, but maybe it's because I'm a country bumpkin. Is it the availability of apps?

 

[50548]

Mr. Ballmer

brands he is bringing:
Bing
Office
XBox Live

Wow, these just happen to be the last 3 things that I want to do on a mobile phone.

Wonderful news coming from the Microshaft serf strangely called Elop - indeed, it's really EXCELLENT to know that Nokia will be dead in no time following its devil's bed agreement with big daddy Ballmer.

Congratulations, NOKIA! You deserve it!

 

[Carniphage]

Those folks are human beings and employees of a company that fell into a rut with a corporate culture that was unwilling to acknowledge that the world was changing and they needed to catch up. Like most of us, they are not the masters of their own destiny. To write them all off as laggards or incompetents is a pretty broad brush stroke.

More to the point, that's thousands of people out of work in that countries single largest private employer. That is sad.

It is sad.

They were a victim of a corporate mindset which prevented innovation, but all the while praised its own success.

But we are in a massive economic downturn. In the UK, thousands of public sector workers are being laid off through no fault of their own. Often having worked for decades with minimal remuneration.

Some people have it worse than the Nokia staff.

C.

 

[Carniphage]

The money I spent on my Nokia smartphone was absolutely worth every cent.

I don't doubt it.

But Nokia was unable to raise prices and generate a profit.
Which suggests that the market as a whole disagrees with you.

C.

 

[kdarling]

So this might be the leg up both groups needed (MS having Nokia's loyal "fanbase" and Nokia getting an OS that isn't seen as sucky though in my opinion I still don't understand why people like Windows Mobile 7, I even prefer MS's earlier mobile OS's to tell the truth).

I prefer the older one, too, but my wife likes the new one. Which reminds me:

To all the Americans in this thread, there's something else to remember about Nokia's decision.

In many European and other world countries, WinMo was quite popular. In some, including Spain and Italy and perhaps Russia too, there are even now still more WinMo users than iPhone users.

So a transition to WP7 could be a popular one in many places.

 

[aristotle]

I feel sad for Nokia and their developers in the Symbian group.

This feels like a hostile take over by MSFT of Nokia. Steven Elop was the head of the Business Unit at MSFT until September 2010 and now, less than 5 months later, he is selling out to his former employer.

I wonder if there will be conflict of interest investigations especially considering that he might still have MSFT stock.

Symbian might have been a "smart phone" OS back in the 1990's to early 2000's but now if feels just as dated as Winmo 6.x.

I think Nokia should have rebooted Symbian with a whole new UI and improved SDK two years ago instead of wasting time on Maemo.

I feel like Nokia will be dead within two years and I feel bad for the workers at Nokia because many of them work in my birth country (Finland).

 

[Stella]

I don't doubt it.

But Nokia was unable to raise prices and generate a profit.
Which suggests that the market as a whole disagrees with you.

C.

Actually, Nokia DID make a profit from their smartphones!

Anyway, you have a good day!

 

[Carniphage]

Actually, Nokia DID make a profit from their smartphones!
Anyway, you have a good day!

Across the board Nokia average 8-Euro per handset. $10 or so.
I think Apple average $270 per handset.

Not sure what Nokia makes on a N8, but the unsubsidised price has fallen $200 since it was introduced.

C.