Tuesday, February 15, 2011

Has Apple And Android Killed Nokia?

It certainly looks like Nokia has missed this generation of smartphone technology. A company that was once a pioneer in mobile phones producing stylish handsets, an OS (Symbian) that was ahead of its time a decade ago, has simply just failed to innovate. We've seen Palm, a once great company, drop by the wayside too (acquired by HP), because product development was too slow. Microsoft's attempt in the mobile sector with Windows Mobile Phone 7 hasn't been all that exciting either. In fact Microsoft's previous relationship with LG was not successful. So why would a struggling company like Nokia attach itself to Microsoft? It's a last ditch desperate attempt before an acquisition and Nokia's CEO, Elop, came from Microsoft.

CNET reports: "The companies plan to build products and services together as well as share strategic plans. The vision is to create a "third ecosystem" that can compete directly against Apple's iOS and Google's Android platforms."

Well, if Microsoft's attempts in the mobile sector are anything to go by, this marriage is likely to be unspectacular. While Nokia is (or was) the world's largest handset manufacturer, partnering with a PC software company doesn't give it the leverage it needs to compete against Apple, which controls the entire product design and OS. (Apple's success has been that control over its hardware and OS throughout its product lines.) So why not go with Android? Elop believes that would have resulted in Nokia becoming just another commodity with no control over the OS. But Android is an established OS and Microsoft Windows 7 trails far behind.

When you are looking at a rescue strategy to turn a product or company around, it makes more sense to pick an established partner in that sector. Even if Nokia and Microsoft merged (more likely Microsoft acquires Nokia), that does not automatically mean success. Two slow moving dinosaurs become one big slow moving dinosaur. Add to the mix that Zuckerberg intends to launch Facebook on lots of Android smartphones, and one wonders what is Nokia thinking?
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