Tuesday, May 31, 2011

Will the Force be with the Nokia - Microsoft Alliance ?

Nokia - was the most successful European company of the 1990s and the most disappointing one of the 2000s. A decade ago, Nokia was the most successful business Europe had produced in a generation. It captured the emerging market for mobile phones and built the industry’s most powerful brand. Since Apple Inc. launched its phenomenally popular product – IPhone in 2007, Nokia shares have fallen by 47 percent. The company’s brand, once one of the coolest in the world, is battered. In a ranking of global brands by Millward Brown Optimor this year, Nokia ranked No. 43, dropping 30 places in 12 months.

Industry experts cite two main reasons among many for their downfall. Firstly, the brand became complacent in an industry where laziness is fatal. It worried too much about hanging onto its market share, rather than creating new products to excite customers. Secondly, the company clung to the model that mobile phones were mainly about calling people. It failed to notice that they were just as much about checking your e-mail, finding a good restaurant nearby, and updating your Twitter page

It is yet to be seen how the change in their leadership and their strategy helps them to bounce back in the highly competitive smart phone market dominated by the likes of Apple, Google, and Blackberry. Nokia took the stage at Mobile World Congress in Barcelona to better explain its new relationship with Microsoft. Instead of developing its own operating system Nokia plans to integrate Microsoft’s WP7 in its smart phones. Nokia specifically chose Windows Phone 7 and not Android because it wants for there to be at least three competing smartphone platforms. Nokia's primary goal is to bring down Android with its WP7 devices. The two companies will work together to create the right set of developer tools so Symbian developers can better adjust to creating for WP7, but it will not use Qt.

Some industry experts are citing this as a win-win strategy for both companies. In the long run, Microsoft needed a stronger hardware strategy to compete with Apple and RIM and to make headway against the ubiquitously sourced Android. Nokia’s choice of Microsoft instead of Android also makes it easier for them to settle their legal dispute with Apple.

Only time will tell whether such an alliance will work for Nokia and Microsoft to compete against the giants of Smart Phone Industry. We can only hope : "May the Force be with you".

References:-

http://www.bloomberg.com/news/2010-09-13/nokia-s-decline-holds-three-lessons-for-europe-commentary-by-matthew-lynn.html

http://www.pcworld.com/businesscenter/article/219431/nokiamicrosoft_alliance_could_end_patent_war_with_apple.html

http://fosspatents.blogspot.com/2011/02/implications-of-nokias-new-strategy-for.html

http://www.phonescoop.com/news/item.php?n=7515

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