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Andrewier
I have been a Nokia user for some time and got anger and anger with the ever ...
elctrnx_lyf
This is a big win for micosfot considering the huge unexplored smart phone ...
Nokia's Microsoft deal clouds Finn's future
Rick Merritt
2/11/2011 10:29 AM EST
SAN JOSE, Calif. – Nokia's new strategy, built on adopting Windows Phone as its primary smartphone platform, is a huge win for Microsoft but raises several questions about the long term leadership of the Finnish cellphone giant.
Microsoft gains the world's largest cellphone maker as a lead partner for establishing Windows Phone, a promising but late-to-market smartphone operating system. However, Nokia will have to be content with being just one of Microsoft's partners for a strategic platform that launched in October with handsets from rising players including Samsung and HTC.
Nokia's chief executive Stephen Elop, a former Microsoft vice president who joined Nokia in September, announced a broad corporate reorganization including plans for a significant but unspecified number of layoffs. He declined to set any financial expectations for the company, calling the next two years a transition period after which the company would grow faster than the market.
By far the largest handset maker by unit volumes, Nokia has seen its market share decline, especially in the U.S. It was slow to respond to the Apple iPhone which defined the smartphone market with its touch screen, open Web browser and advanced application processor.
Under the deal, Nokia will make Windows Phone its primary smartphone OS. It will also adopt Microsoft's smartphone developer tools, roll Nokia's app store into Microsoft's offering and use Microsoft's Bing as its primary Web search service. Nokia also will integrate its Map service as a key part of Microsoft's Bing.
Nokia will struggle to differentiate its products as one of a growing set of Microsoft handset OEMs, several of which released handsets in October. Early to embrace the cameraphone trend, Nokia suggested it will try to innovate in areas such as imaging and language support, but neither sounds like a credible on the surface.
The planned layoffs and the lack of any financial guidance fuel concerns about difficulties Nokia will have distinguishing itself as a Microsoft OEM. Indeed, the company ultimately may face the same kinds of pressures Microsoft's PC partners felt a decade ago as they battled over who had the lowest prices.
Microsoft will need to support all its OEMs. Its history in the PC business shows it will not hesitate to deemphasize even a leading OEM such as Nokia if its business continues to declines as Samsung and other rise.

Nokia's Stephen Elop (left) and M'soft's Steven Ballmer
Next: More open questions


Warren
2/11/2011 11:18 AM EST
The headline reads "Nokia's Microsoft deal clouds Finn's future" but the firms future is clearer than ever... bobbing tentatively for a time, casting about for another to save it from ruin, then sinking like a rock.
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nicolas.mokhoff
2/11/2011 11:44 AM EST
When two behemoths get together it's hard to ignore the elephant in the room. Smartphones may be all the rage of Apple's followers now, but I would not put it past both Nokia and Microsoft to find a "magic bullet" to attract both the corporate and consumer world. Execution will be everything, as they say in Mgmt 101.
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eewiz
2/11/2011 11:54 AM EST
This deal helps to cover Nokia's incompetency to make a decent mobile OS and also helps them to get some instant market share in US market. But as Rick mentioned
"Nokia will struggle to differentiate its products as one of a growing set of Microsoft handset OEMs"
For MS they get instant market share to 35% of worlds phones. I guess MS might have agreed to sell WindowsPhone7 licenses for almost 0$ to Nokia and might also have agreed to share the revenues generated from the ecosystem, like share ad revenues from Bing searches,share app revenues from apps downloaded to Nokia phones, Share Music/Video content revenues etc... Still a good deal for MS I would say :)
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Warren
2/11/2011 12:08 PM EST
"Still a good deal for MS".... Yes, this is a GREAT deal for Microsoft. However, they will get almost zero percent market share of the worlds phones, at least for some time to come... Nokia is big in low-cost markets where Symbian will [probably] be their primary play (unless of course they choose to quickly dump their "franchise platform").
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yalanand
2/11/2011 12:15 PM EST
Why did nokia choose Windows and why not Android ? Why is nokia shying away from releasing Android compatible handsets ?
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Warren
2/11/2011 12:48 PM EST
Nokia, I think, had a plan... a good plan. It was to introduce a line of handsets where the software would work exceptionally well up and down the computing stack (handhelds, netbooks, laptops, etc., etc., etc.). And MeeGo is an exceptional solution (in my opinion) but Nokia's execution problems, it would seem, made it impossible for it to lead in this effort within the handheld market. Win7 in principle allows Nokia to keep the exact same strategy but instead of being aligned with Linux it is aligned with Microsofts Windows 7 OS. Do not expect to see Android operating far up the computing stack.
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garydpdx
2/11/2011 1:40 PM EST
Adding to what Warren said, I don't think that Nokia's MeeGo platform work will go to waste but rather, be retargeted. First to OS with MSP7 and maybe then hardware with a move to Atom (note that the MeeGo initiative is being done with Intel despite that the MeeGo phone slated for late 2011 runs a SnapDragon). We may be seeing the birth of the NokWintel sector of mobile comms!
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prabhakar_deosthali
2/11/2011 12:50 PM EST
This definitely will put some brakes on the growing popularity of Android as the preferred OS for mobile. With the two giants joining hands , it is anybody's guess how both Nokia and MS will play the catch game with Apple and the Android players
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yalanand
2/13/2011 11:14 AM EST
Yes agree, Microsoft has very good potential to give tough competition to Android. It would be kind of UNIX vs Windows fight on PC.
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Helicopter
2/11/2011 12:58 PM EST
The Nokia advantage that existed thus far is lost. Why would people prefer a Nokia handset vs. Samsung,Sony or any other chinese manufacturer? After all, nokia is not known as the cheapest device maker.
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garydpdx
2/11/2011 1:36 PM EST
Nokia is still the leading seller by unit volume so the firm is seeking ways to preserve its market share. A large portion of global mobile users do not yet have smartphones so positive experience with Nokia added to the strong branding of MS may be enough to save that share. I also know of many Windows users who don't yet have a smart phone and view them with a bit of suspicion (i.e., anti-Apple bias), but would likely pick a MS-run platform in the future, if maybe under duress (we can see a day when the only mobile phones are smartphones).
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Helicopter
2/11/2011 2:21 PM EST
High end devices are the money makers, it will be intresting to see how Nokia is profitable in the next 2 yrs.
Perhaps the MS cash infusion was the only way!
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patrick_yu
2/11/2011 1:53 PM EST
The partnership could be ground breaking. The consuming world can definitely be benefited by a creditable 3rd player besides the iOS and Android.
Nokia made an excellent choice by going with Microsoft. It has many overlap & conflict of interest with Google. Map is a major one. In the Android camp, Nokia needs to fight for attention while the majority of those could have already been given to Samsung, Motorola, HTC alike. Nokia and Microsoft have both done many far-reaching research over the years across a broad spectrum of applications. Combing together, a lot of sparks can come through. This partnership can have many far reaching results over the years, assuming reasonable execution. I have always discounted Nokia's phone for the past 10 years. But, I will look forward to getting one within a year from now. Great, Apple and Google now have some real competition and the world may see some true innovation for years to come!
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Frank Eory
2/11/2011 2:13 PM EST
To my view, this looks like a win-win for both Nokia & MS, but I'm not sure where it leaves Intel's mobile efforts -- especially now that MS will support ARM.
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markhahn
2/11/2011 5:16 PM EST
sad, really. two walking-dead companies get married - exactly what kind of offspring can we expect?
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Jorjor
2/11/2011 9:02 PM EST
In Ireland, most of people in their middle age or more, are using smart phone, and young people prefer iPhone or google's Android phone, because of their cool looking. Nokia still have a lot of funs. But I have to say, though symbian OS seems stable, its response speed for the user seems a bit low compared to that of iPhone and Android. The Nokia handsets are quite good even though the OS seems to be weaker in the smart world. I think this is why Nokia and Microsoft are tied together. Another side, Microsoft doesn't have any hardware relevent business, if it wants to suvive, it has to look for some hardware based partners. Microsoft with ARM or Nokia, is one of Microsoft's plan for the future.
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goafrit
2/12/2011 8:57 AM EST
Not a good move by Nokia. This is their end. Android will rule this earth and I am sorry for Nokia. Why should someone buy a window phone?
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yalanand
2/13/2011 11:17 AM EST
Goafrit, why not windows ? I am sure the familiarity with windows PC os will give mobile users that extra comfort with Windows OS phones.
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PeterTan95
2/12/2011 9:47 AM EST
i agree, i only like nokia because it was the phone when i grew up with and accustom to use. There are already windows phone in the market but whos buying? I dont see anything good for nokia in this deal
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eewiz
2/12/2011 11:30 AM EST
Here is video of the NOKIA-MS press conference.
http://www.youtube.com/watch?v=-P9GwS5y_1c
The initial concepts seems pretty interesting
Checkout
http://www.engadget.com/2011/02/11/exclusive-nokias-windows-phone-7-concept-revealed/
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Sheetal.Pandey
2/12/2011 5:08 PM EST
After reading this article I got a feeling that Nokia is givng in too much for this deal. What is the position for Microsoft in the deal. Nokia phones are no doubt very reliable and user friendly but with MS OS and other fetaure not sure how it will compete against Apple.
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KB3001
2/12/2011 7:55 PM EST
I think Nokia have, probably, just signed their death warrant with this deal. If they wanted an OS they would share with others, they should have continued with Symbian or gone for Google's Android. Instead they did what IBM three decades ago and gave Microsoft a lifeline with little in return. The difference this time is that Microsoft is a late-mover and not a first-mover, so I fail to see what Nokia will get out of it, if at all.
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rick.merritt
2/13/2011 2:47 AM EST
It will be interesting to see how long it takes Nokia to get a WinPhone out, whether they put any real pressure on Android and what if anything Nokia does to differentiate itself from Samsung, HTC and etc.
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Tunrayo
2/14/2011 6:59 AM EST
Nokia has been late to the market already. I hope to see what they have to offer on the smartphone market - but it is already a lost cause in my opinion.
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chanj
2/13/2011 9:57 PM EST
Going to Android will just make Nokia no difference from Samsung, Sony Ericsson and LG. Android may be ruling market of mobile device for a while. Fail to acquire a close partner to grow a better UI and a better product would be an idea going against Nokia's wish. The success of a product isn't just a product itself but the market execution. I certainly wish the relationship between Nokia and Microsoft will breed a new product and even a new market.
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Jack.L
2/13/2011 10:34 PM EST
I think calling this action the nail in the coffin for Nokia is given Nokia's current course too much credence and chance of success.
I think at this point, we need to stop calling them "smartphones". The iPhone changed all that. The iPhone is really an iPOD Touch that just happens to make phone calls. Most of the "coolness" of the iPhone was already there with the iPOD Touch.
I think the analogy to IBM and Microsoft in the early days of the PC is accurate in some ways, but it is not about what IBM gave away or lost, but to the "birth" of a platform. That same birth is happening again. Nokia came to the conclusion they did not have a viable platform to compete. They may have come to the conclusion that a proprietary platform would not fly in the future. Anyone remember Commodore computers?
Perhaps Android would have been a better choice, but perhaps Nokia doing their homework felt otherwise. While Android is very popular, the number of apps sold -- not available, but units sold, is small.
No ones crystal ball is perfect enough to pick a winner. Android does seem like the safest bet as eventually Apple like the Mac, will become a niche player.
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Jack_F
2/16/2011 6:08 AM EST
It is advertised as a power-merge of two giants, but the deal targets a smartphone market - the market, in which these two are giant loosers! Some say it may be: 1+1 yielding more than 2 (synergy effect), but to me it seems like 1+1 yielding less than 1 (looser plus looser yields just a bigger looser!).
The very first moment I'd heard Elop taking the CEO post at Nokia I got a feeling it must be a kind of MS's Trojan horse, and with this co-op anouncement it has just opened up! There are arguments for not choosing android, but choosing WinPhone can help Nokia gain the market only among those who never heard of Windows before the XP version and then fell in coma for the period of Vista being in the market. I bet it's not too big share! Abandoning Symbian is way too fast (or should have been done MANY years ago) now after it got working with touch screens, widgets, etc., and the "ovi" app store gained momentum. There should have been more resources (and Nokia had enough cash for that!) put to MeeGo instead, which works fine on N900 phones. Many liked Nokia for its reliable hardware, and open sourced OS. But they sold hardware design to ST Ericsson (to free themselves to choose whatever hardware is 1st/best on the market), and now opt for WinPhone7 OS - what's left? A logo. How's that differing from HTC, Samsung and the like? It migt be not the coffin nail to Nokia as a company (hard to predict, but rather likely), but it definitely is a coffin nail for the sentiment to Nokia brand.
Bottom line - great deal for MS, and likely a death sentence for Nokia. Sad but true!
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elctrnx_lyf
2/16/2011 6:38 AM EST
This is a big win for micosfot considering the huge unexplored smart phone market of the future. Is windows can really build a good OS which can give user experince of apple ios and android, then we might saee a real battle in the future.
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Andrewier
2/17/2011 10:23 AM EST
I have been a Nokia user for some time and got anger and anger with the ever growing bugs on their smartphones (my current N97 is a nightmare). I don't want the newest app or fancy updated OS. Just a bug free phone with the functions I did pay for. And now, instead of continued development must I buy a new phone with another OS from the scratch? Sure... Thanks, but no thanks. I will look for a different brand.
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