A long time ago, when World War II ended, two things happened. Two brand-new superpowers emerged, the United States of America and the U.S.S.R., and the world very soon organized itself into two camps. As this power shift happened, Great Britain lost its preeminence as a world superpower.
Hobbled by the heavy expenses of the war, Great Britain couldn’t muster up the economic heft needed to hang on to its superpower status. Not long after, the dominoes started to fall. It had no option but to give India, once its crown jewel, independence. The British Raj came to an end. And soon after, the British Empire came to an end.
That little snippet from history is less a political comment, but more as my way of trying to give some context to the mobile industry. All great empires come to an end, and perhaps today, we are seeing the beginning of the final days of Nokia, world’s largest mobile phone maker and the company that, among other things, championed the very idea of a smartphone.
After Apple (s AAPL) and Google (s GOOG) changed the rules of engagement of the mobile industry, Nokia has found itself becoming less and less relevant. For nearly four years, it has been in denial when it comes to the software-centric mobile platforms (and ecosystems). Nokia has failed to respond to its rivals. All it did was talk and talk and deny that Apple was a problem.
Low End Low Blow
Every single time, I took Nokia to task, I was flamed in the comments, with many arguing that it was still a very big brand in Asia and Africa and it had the volume. And, yes, Nokia was big in India. It was making so much money in India and other emerging markets that it failed to realize that it was beginning to lose ground in Europe. Moreover, the Americans had shifted mobile’s center of gravity to Silicon Valley.
Almost two years ago we wrote about the emergence of MediaTek and low-cost Android smartphones, which were eventually going to kill everything on the low end of the handset business. Nokia, my rants not withstanding, failed to realize that it was a frog that was being slow-boiled at the low end by the MediaTek-based phones and by Apple’s heat lamp on the top.
Just this week, Strategy Analysis came out with a report that both Nokia and Samsung were getting a lot of competition at the low end of the market from Indian handset makers with exotic names like Lava, MicroMax and Spice. These companies are going after very cost-conscious buyers in rural India, which incidentally is a massive market.
“National pride is a factor, but when people spend almost 4 percent of their annual income on a mobile phone, they are going to make purchase decisions based on what will get them the most for their money,” said Tom Elliott, Director of EMCS in a news report. How much do you want to bet that India won’t be making that much money for Nokia!
Indian and Chinese manufacturers know that they have a massive market, and they can use their domestic strength to springboard to other markets. Indian phone companies are looking to expand to Africa and other parts of Asia, so why shouldn’t Indian phone makers harbor such ambitions? It also goes for the Chinese brands — Huawei and ZTE are already making a killing. Nokia, which has ruled the emerging (phone) markets for so long isn’t going to rule them — its raj is over.
Now let’s look at today’s deal: Microsoft and Nokia.
Earlier this week, I wrote a post about how companies have a tough time trying to reconcile with change. Make no mistake: Nokia is a great hardware company with awesome logistics capabilities. As a result, it makes perfect sense that it should focus on its core strengths, and it is doing so by teaming up with a partner who has the desire to spend billions to build an ecosystem. The problem is that it is picking the wrong partner.
There has been a lot of emotional outpouring on the Microsoft-Nokia partnership, so I won’t repeat much of it. Instead let me explain why picking Microsoft is the wrong strategy. Windows Phone 7 is a nice and interesting platform. Its difference has gotten it kudos. What it hasn’t been able to do is get a lot of developers. And despite all the public boasting, it doesn’t have that many users: only 2 million shipped
sold. Those quibbles aside, Windows Phone 7 has a much bigger problem.
Four years ago when Apple launched the iPhone, it essentially defined the metaphor for a very touch-centric, smartphone world. Later when it added apps, it only reinforced usage behavior. The subsequent launch of Android OS and Android-based phones were a reflection of the user experience that had been popularized by Apple.
Today, from an average phone buyer’s perspective, Apple’s and Android’s UI is essentially the standard that consumers expect from a smartphone. Do Microsoft and Nokia truly expect that people will learn yet another new behavior? I think the two companies are being overly optimistic in their belief that their UI is going to catch fire with consumers just because Nokia is putting Windows Phone 7 on its smartphones. It is akin to buying a sports car today, hoping to pay for it with by winning the lottery on the weekend.
In a colorful note today titled “Ctrl+Alt+Del,” RBC Markets analyst Mark Sue asked the question: “This is a major reboot and it will take some time for Nokia to offset the decline of its Symbian devices with Win7 phones. Will this be a true partnership or will bickering stall the process before the first phones are shipped?” The bickering he is talking about is between happy friends today!
Mountbatten of mobile
So am I faulting Nokia for partnering with a third-party OS? No, I am not. In fact, if they were going to make the move away from their own proprietary operating systems, then they should have opted for not just Microsoft OS, but also for Google’s Android and whatever else is out there. Today Microsoft, Android in a few months, and whatever comes next — that would have been the right strategy. In other words, take a page out of Samsung’s playbook. It would have allowed them to have scale, have multiple market entry points and essentially leverage their core DNA: their ability to make good hardware and use their logistics to push it into the market.
Now imagine if the market gives Windows Phone 7 on Nokia a big thumbs down. What happens then? Curtains?
I can’t but feel that Stephen Elop, the Nokia CEO, is the Lord Mountbatten of mobile, essentially overseeing the slow and sure demise of this once proud company that ruled the mobile planet. In a few years, we will look back and see Nokia as yet another mobile brand, jostling for market share with the likes of Sony Ericsson, Samsung, LG, Motorola, the Chinese, the Indians and Apple. It will have the history, it will have the pomp and circumstance — it just won’t have the power.
The Raj is over!
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88 thoughts on “The End of the (Nokia) Raj”
I think you got it about right. Oh Nokia, that little boy in Finland called and said he wanted his pee back.
“only 2 million sold”: Only two million shipped, if I recall the briefing correctly.
let me check into that. from my notes it is 2million sold! I will recheck and correct based on what I find out! thanks
Om, Glenn is right. It was 2 million “shipped.” Not sold to end users.
Nokia CEO, Stephen Elop, is the 7th biggest owner of MICROSOFT stock. His Nokia stock = 0
Anti-trust, Fraud and Insider trading charges should be brought against him.
He sold Nokia for $0 so that he and his Microsoft bosses profit.
Yes it was “shipped”. And since I have yet to see a single WP7 handset held by an actual customer who is not a Microsoft or Dell employee it would not surprise me if WP7’s actual market share is even lower than published by Gartner, IDC, etc.
Om: imho I think you are right. And thanks for the history lesson 🙂
Also, lots of WP7 phones are handed out as prizes at giveaways, contests and the like.
Not even that: at the time of the post, Microsoft claimed to have issued 2 million licenses for WP7. The numbers of WP7 phones actually manufactured, shipped, and sold are obviously less.
A minor point. Microsoft is a minor player today in the Samrtphone marketplace no matter how you look at it. Otherwise, Om’s post is on point.
But nothing stops them from adding Android too. For now, they are just taking Ballmer’s marketing money, on a non-exclusive basis.
I think MS will pump enough money into WP7 and the ecosystem will take off. Especially now that Nokia is on board. Don’t forget also that carriers want leverage against Apple and Google. They would be happy to see a third platform succeed, so will support it as a counterbalance to Apple’s arrogance and Google’s dominance in the sub-Apple space.
Are you sure there isn’t a clause on exclusivity in the agreement? I’m feeling Elop would make sure Nokia won’t have Andriod anyway. Re:the situation with carriers, it’s only in the US where Nokia isn’t a big player. Personally, I hope the carriers won’t have any leverage at all, usually when they’re in a strong position, they screw the customers.
When your third in, and used as leveraged against the top two, that’s no way to go through life..
Well it’s not ideal… but the mobile market is easily big enough to support 3 platforms. And part of this Microsoft masterstroke is that they just ended the platform wars: there is a bulge bracket of 3 (one of them being Microsoft) and all the rest are left to wither and die.
Arrogance is when you think you are the best and you are not. That is not Apple, that is Nokia and Microsoft.
Introducing The Microsoft Puppet http://bit.ly/ifBueE #nokia #msft
Insider Register: Elop does not own any shares of Nokia stock – HS.fi – Economy http://bit.ly/hzBPiA
But how many options does he have, or other similar grants?
The part I struggle with is on the one hand “This is a very new market up for grabs!!” but then “Oh it’s too late for a thir party entrant – no one will want to learn a new OS/UI”. Didn’t Nintendo and Sony have the gaming industry locked up? There’s still a lot of time for a “Kinnect” moment in smart phones.
well, it depends whether their different UI is a Wii, a new experience that customers didn’t know they want. So far, it doesn’t seem to be the case. Different only works if it’s also better.
Thanks Eric. Think of Win7 as the xbox with the Kinnect moment still very possible in the future.
No, the phone market is not new, and the made-up smartphone market is not new, and even the iPhone is not that new.
Microsoft and Nokia sat on their butts and laughed at Apple for 4 years now. They don’t just jump in and catch up. They have to crawl, then walk, then jog, and so on. They have to get people other than the Microsoft and Nokia CEO’s excited about their platform. And they say they will not ship for another year at least.
Plus, the Windows Phone 7 software is painfully immature. It’s the only smartphone without HTML5, which means they are in 2006.
Kinect is a great accessory, but not the biggest thing to happen to gaming over the past few years. The 8 million Kinect users are dwarfed by 200 million iOS users and their huge library of 3D games. There are way more developers adapting their Xbox games for iOS than adapting them for Kinect.
A smartphone without apps is just a feature phone. Why am I going to pay $1000/year to run a feature phone? Especially one that can’t even run YouTube?
So it’s not early, but even if you think it is, Microsoft and Nokia are not even on the scene yet. If they arrive in mid-2012, they will meet iPhone 6, iPad 3 or 4, and a family of HP phones and tablets that is a year old, and of course many free Android phones at the low-end.
Mountbatten of Mobile – love it !!
“Nokia, my rants not withstanding, failed to realize that it was a frog” – WOW..hubris on your part and ofcourse Nokia’s…do you really think you are that important???
You are good, love reading you, but lets not get carried away shall we?
Nokia’s market loss is no different from what can happen to anyone that fails to manage its software (hardware after all is a commodity play)
As you rightly said, Nokia forgot the future while focussing on the past (read phones of the 90s). Nokia will just become another hardware player.
There is only one company that is flawlessly executing the software strategy and the hardware strategy – Apple and don’t go so hard on MSFT – give them time – they will catch up to Google or perhaps they need do nothing – Google is fast going down and MSFT will just catch it on the way above.
Actually Om +is+ that important. Or, rather, he was reporting the truth. I was too. But jerks like you didn’t listen. You helped Nokia keep its head in the sand for the past three years, even as I kept coming back from Europe and noticing all the developers there had iPhones. You kept throwing insults, like you just did. You were wrong. You and your friends destroyed a company because you were NOT willing to see the truth. This is why fanboys sometimes are so horrid for companies. “Hey, we have fans, we must still be cool.”
Om +is+ that important. He’s one of three blogs that the tech industry listens to. Nokia should have listened earlier. Its cultural arrogance was telling. Even up to December they still were arrogant on stage at LeWeb.
But, now that I’ve cleared my throat and told you to back off of Om, I want you to listen to something. http://www.cinchcast.com/scobleizer/170737
It is with a developer. It shows just how deep a hole Microsoft, Nokia, and RIM are in.
There is only ONE thing that matters now: apps. Apps are driving the entire market. Developers still are only betting on Apple and Google. Can Microsoft or RIM or anyone else change that? The developers I talk to (and I talk with a ton, the recording I put up tonight is just one good sample) are saying Nokia/Microsoft/RIM are screwed. Will their management team listen?
Not if they have the attitude you do.
“…are saying Nokia/Microsoft/RIM are screwed. Will their management team listen?”
But supposing they do listen — what can they even do at this stage?
I’m sure Microsoft understands the importance of developers — that’s why they bribed a bunch of them to write W7P software. I have no idea what RIM does or doesn’t understand, but they are certainly the next Nokia — the BlackBerry is in free fall in the US market, being propped up by a dead-phone’s-bounce in the emerging world. But let us suppose RIM’s cheiftans fully understand how big their problem is — what can they do? They bought QNX and presumably they are trying to migrate it as fast as they can to the BlackBerry. I highly doubt that will rescue them.
Anyone who didn’t say “oh shit” in early 2007 and do an all hands move to try and compete with the iPhone is in horrible shape right now. For the record the only company that took Apple seriously was Google, possible because Eric Schmidt was on Apple’s board. RIM’s people were claiming at a company meeting that Apple was lying about the iPhone’s battery life, that their iPhone claims were impossible.
That was then, this is now — now what?
P.S. I don’t think becoming an Android OEM is the way to riches. Look at Motorola — with the iPhone now stealing their customers on Verizon, it looks like they will ride the Droid brand all the way to bankruptcy. The $800 Xoom sure isn’t going to save them.
Robert you are quite right when you say Apps are driving the market. But surely Nokia was in a stronger position using its own QT platform which as a full time .Net coder and occasional QT dabbler I can say without any doubt is just a good as MS’s environment.
Nokia should have tried to build an ecosystem with all the other smartphone OSs – RIM’s QNX, HPs WebOS and any other that comes along, even WP7 – together they would be stronger than each on their own and QT really is built for easy porting between platforms.
I feel like Nokia have failed so completely by miss steps and wrong turns. If Palm with its development budget could role out webos surely Nokia should have been able to reboot Symbian with the UI it needed or get Maemo/Meego out the door quicker.
Incidentally friends within Nokia tell me that Meego *is* ready but now I don’t suppose Nokia will want to release anything that detracts or confuses its WP7 message.
Such a shame
Wow! Nicely said, Mr. Scoble.
Om/Robert, Nokia’s failure was one of execution. I don’t think anyone would argue that.
Symbian was on course for EOL in two to three years but MeeGo via Qt gave a clear transition to the next platform. Unfortunately they botched that by partnering with Intel (you would think that the Symbian Foundation would have shown them that doesn’t work) and trying to build an OS for all things rather than focusing on an ARM powered mobile platform.
At a platform level – and not UI because Nokia bodged that badly – Symbian remained better for the current generation (2008-2010) of phones because of its resource management. The failure here was to package that attractively and generate engagement and hype.
Lack of timely execution. Again and again.
If Nokia had executed their strategy well then Friday’s announcement would have been different. As it is, Elop as gone in, seen that they’re nowhere near ready and selected an external OS for their strategy over the next few years. The interesting bit is that MeeGo will be bought back in house and used for future strategy. This suggests Nokia may be doing a Samsung – use an external OS to grow share and sales and then start introducing your own product (Bada in Samsung’s case) which will eventually take over.
I also take your point about apps but I think it misses two things:
1) The app market is still young and will have the same implosion that the .com boom did at the start of the millennium. Come on, Robert, you’ve seen the financials and they don’t stack up. The ones that survive will be the ones with the biggest addressable market, not the ones who think some platforms are cool and others are not.
2) Ovi was the second biggest store by download volumes, ahead of GetJar, Android market, RIM and the rest. There were over 30,000 Apps provided by most of the big providers. Your argument about developers is true in some respects but not complete – it depends on who they are because the big guys will look to service all platforms. The smaller ones or platform focused ones will exclusively pick the currently in vogue platform. Sometimes it’s a good choice, often it’s not.
Which is not to say you’re completely wrong – there are some key gaps in Ovi’s portfolio. Had Nokia got its execution right this may have been different and now Nokia have managed to alienate a substantial part of the developer community by pushing them in one direction and then yanking the carpet out from under them.
All things come to an end. The same will happen to Apple and Google if they fail to adapt.
What about that http://scobleizer.com/2011/02/11/dear-nokia-fans-youre-nuts/ ?
Consistency much ?
Lovely post Om! While it makes a great article but all is not lost for Nokia. Don’t discount the fact the Nokia is #1 in India and China by a massive margin and the second place holder is nowhere in sight. And it holds this rank not by the virtue of smartphones. Combine India+China and you have 2.5 billion (i.e 1/3 of humanity) living in this part of the world. Apple is barely able to sell anything there. So, the alliance is a smart move, in the sense, it will get the smartphone users back(they’ve barely drifted anyway) and the lower segment will remain as strong as ever. While others can dream of achieving 1% growth here, Nokia will remain the king for a long time to come. Also, Mobile penetration is hovering around 50% in China and 35% in India and about 5% in Asian countries like Myanmar. This is where the next billion will come from, Remember that. Talking of growth..Go figure
This is backward looking data, which is exactly what Om is referring to as something people keep pointing to. + they are facing market share declines (and Om refers to upstarts there too). Also those markets are low cost/lower margin. And plenty of competition and more so in future. Rememeer – when you have a high market share, you go in one direction – down. staying flat os best case and the entire universe comes after you. just my 2c.
I was a Nokia die-hard before the i-Phone altered the landscape forever. It’s easy to dismiss this as another blunder in a series of blunders but I think the long term outcome of this marriage would be interesting to follow and watch. Two former giants going against the two that are currently dominating.
Don’t get me wrong, I agree with most all of the points you make, but considering the depth, reach, history & influence of these behemoths, maybe, just maybe. . .
By 2012 when Nokia is ready to come out with WinPhone7 there will be 4 core mobile CPUs. What do they expect people will expect? A different UI experience between their productivity suit say based on Win 8 and their phone, pads. Or a seamless experience between all their devices?
WordPerfect expert users glamored how fast they could reach any keyboard macro nobody else could remember, poor GUI morons. In the end the morons won, from that we can assume a unified [touch] UI experience will take over from here on. Menus are the macros of the past, generalized productivity application will change or be replaced by task apps.
Elop earlier mentioned about pouring gasoline in burning platform. What does he try again by going in with Ms.?
At least give credit to Elop for being a bit humbler than Lord Mountbatten.
Intresting analysis ..world doent come to an end with US only hence Nokia is looking at a world where Apple is struggling nothing wrong with that also dont forget that Nokia and MS both have a huge sales and distribution strength which Apple Google do not.. on a flip side decision making is slow in Nokia & MS because of large no of decison makers at various levels Motorola also had it this is a management malise when you grow big in terms of employees..Apple & Google are able to move fast due to fractured decion making .this is a good strategy to adopt by NOK and MS ..unfortunatley analyst comments are pure thougts not based on geographical operational realities .. hope to see your articles beyond the gut feelings
After a long time I read “Apple” and “struggling” in the same sentence. interesting take.
I tried a Nokia Smartphone (E70) for a few months back in 2006. Great hardware but if you did anything “smart” with the Symbian OS, it made the phone pretty unusable. The many Symbian updates were like putting lipstick on a pig. I never understood why Nokia persisted with Symbian for so long instead of buying Palm.
Nokia should have went with Android maybe it’s not too late to switch. Everyone will forgive them, even those 2 million devote MS users with a Windows 7 Phone.
Apple- the frog that got boiled- twice
On the whole this is a good move for Nokia – it keeps them relevant.
Because this a first date where Microsoft is picking up the tab.
This is a multi-year investment strategy for Microsoft.
They will invest in marketing, technology integration, Win 8 / XBOX platform synergies and developer ecosystem.
And what they get for that investment is a massive distribution channel into Asia.
Microsoft won’t bother fighting North America and Europe – but they might have a shot for Asia. And it might keep Microsoft relcleclvant also.
Well, at least they finally realized Symbian is horrible.
“That little snippet from history is less a political comment, but more as my way of trying to give some context to the mobile industry.”
Accepted but wrong. Britain’s superpower status was over by 1918. The Nokia analysis is flawed too. There is no exclusivity and you will see Nokia Android phones. What the Nokia-Nicrosoft deal offers is an opportunity for a hardware manufacturer to pair with a software developer and develop a killer OS/set of devices. Symbian had to go. The deal offers a last chance to both Microsoft and Nokia to remain relevant and at the top of the chain. Strategically it makes sense because Android cannot offer the same technical bridges. It probably won’t happen, the culture gap too wide to bridge, history against them, but the Raj analogy is flawed, wrong and irrelevant.
Well, gotta agree with you there.
If one can set apart the past cultural weaknesses of these companies for a moment, and think of ‘pure potential’, you’re right about something here: Nokia needs an opportunity to learn new tricks. Maybe they can learn them from playing with MS.
Everything that’s happened so far seems to have been part of their plan to cement their leadership status, to preserve what existed, instead of creating genuinely new things. Maybe with some luck and lots of honest self-reflection and decision making, Nokia can finally learn to grow culturally (much like Palm apparently did with WebOS, only too late).
After all, mistakes, even costly mistakes are necessary parts of learning processes. Avoiding disasters is not a good first principle to act on – it needs to bow to the value of experience and learning to learn from experience.
Remember the partnership Microsoft had with Apple? And then they came up with windows, what a coincidence… Or the one they had with Sybase? Hmm, MySQL, another coincidence… Or the one with IBM and the OS2? I could go on.
My point is that Microsoft’s business model is essentially ripping off their partners. Of course, smaller companies might benefit from such partnerships, if they can latch as a remora on Microsoft, but Nokia is too big for that. So, Microsoft will get Nokia’s maps, some other software, some Bing hits and the death of two competing mobile OSs. What does Nokia get? Ooh, look, MS lets them customize the WP7, but they promise they won’t abuse that…
We should ask ourselves what Elop gets from this “partnership”.
Who shall play Edwina and Nehru 😉
Nokia should have gone Andriod and continue to make great hardware.
Thanks for sharing your opinion.
On any queries regarding the announcement post your comments on Nokia Conversations. http://conversations.nokia.com/
The wording of the announcement saying Windows Phone 7 will be Nokia’s ‘primary’ smart phone OS suggests the door may be left open; but of course, as you say, we don’t know what the agreement says.
One point… I too thought Android was the better choice, but consider that Nokia has not made a truly great OS layer. Has Samsung? The Windows Phone [#] UI is pretty solid, and it would take Nokia a year to devise anything serviceable for Android… These are two companies which are about to be forced out of the game. This is not choice.
I will stick by my opinion from long ago in these comment threads, that a browser based device is what Nokia needed. A browser as the first layer is the future. Calls, contacts, media; messaging are all subsets of the act of browsing and searching. That is what is so potentially cool about something like Chrome.
As a local grieving party to this developing history, I would offer this point in favor of the deal:
Microsoft has so far, like so many other tech-companies, been very bullheaded when they were left to dictate the terms of engagement for a new platform, not least because they often lack the feel for the product-as-a-whole [including hardware] that some other companies have.
Nokia, at best make great hardware, but not just that. While they lacked the depth of software engineering props that Microsoft/Apple have had – and suffered tremendously because of it, to the point that this day came about – they *have* at times been very much in touch with what was usable, and made UIs that were thought-through. Even their user-centered design obsession sort of speaks to this.
Maybe Nokia can assist MS in turning WP7 in the right direction, partly by being able to demand things that are needed to turn the probably quite fine software underpinnings of WP7, and the nice UI layer, into something that actually clicks with hardware and user, instead of just being a nice concept housed in generic plastic boxes?
It would be refreshing with something else than than the same old, same old Android competition to Apple, to make Apple even better, and Google more respectful – and to preserve some of the best of the Nokia legacy.
I state as much in other threads here, and believe that together they could provide a solid software/hardware experience, so long as they are not one company. That will be the death of it all!
What Google sees is services. Everything they do is about a service as opposed to an OS or a product. Gmail, maps, search… Users want to accomplish something, not experience your OS! Getting out of the way is something that nobody seems to get in mobile and in services this is critical. The behavior I’m seeing in business is confirming this.
It is about behavior. For better or worse, Google will be the first OS vendor with an “interface-less” mobile layer.
We are about to see a shift by MS from the OEM licensing model to the manufacturer model they pursue in the game market. Once they work out the details with the Finnish government and EU regulators MSFT will absorb Nokia.
So another way to look at this is Microsoft as an invading force, taking over a one proud independent nation. Not sure I would hazard the political commentary of a comparison to post world war 2 geopolitics though 🙂
Or guess how it will end!
Disclaimer: I work in Redmond, and I didn’t have to pay for my WP7.
The suggestion that iOS/Android UI is a standard that people must have is I think short sighted. I’ve seen anecdotally that non-techie types really like the WP7 UI, including my wife and best friend (we’re talking non-techie women here).
I’d love for someone to research what the Android sales were after four months and compare. Someone already did compare the number of apps, and WP7 is well ahead of that curve. (You can bring up the subsidized app thing, but come on, that’s a rounding error.)
Android “couldn’t” compete with iPhone if you recall the position of the tech press. Obviously they were wrong. This market is still so new and the pundits and press we rely on reject this, anxious to declare winners as if this is some one-off race.
Anyone remember when Xbox “couldn’t” compete with Sony and Nintendo?
I don’t know if this arrangement makes sense for Nokia, or even if there’s any exclusivity involved. Honestly, I don’t even care very much. But people writing off WP7 is getting really old. You can’t call a failure this early.
Microsoft pushed NetBui when the rest of the world decided TCP/IP was the winner.
Microsoft pushed CD-ROMS when the rest of the world decided WWW was the winner.
Microsoft pushed pen/menu based tablet computing when the rest of the world said no thanks.
Point is, sometimes the rest of the world sees a winner long before Microsoft does. The Xbox is a relative small, static environment not comparable to size and dynamics in the phone and new tablet market. The old way of Microsoft getting it right on the third try is a dying delusion. Now they have to compete with companies which have a higher market cap and money in the bank to corner even a HW supply market.
Times have changed. If Microsoft doesn’t pull out something of the equivalent of kinect for the phone app development process there is no hope.
Making generalizations based on the actions of a company now numbering 88k people with exponential growth in the number of different businesses it’s involved with is completely lazy thinking. If you honestly think that Microsoft hasn’t changed or is doing things the way it did 10 or 20 years ago, you’re not paying attention.
If Nokia is like the British Empire, then Apple is like the USSR, Google like the USA and HTC, ZTE, LG, Samsung, Huawei are B,R,I,C,S (respectively)
Om, I think you got it exactly right – WM7’s tile UI is a non-standard 3rd UI (if you make RIM the 2nd), and this alone is enough to keep it from catching up.
Elop seems to have made his decision based on a pile of long-shot hopes for the Ovi platform, Nokia’s fading market share, distaste for Android’s rapid ascent and familiarity with his former employer. Classic C-suite big picture thinking – too far removed from the bitter reality of how consumers think when parting with their cash.
But, you can develop for Windows Phone! BB is a damn nightmare of fragmentation in hardware, software, and OS behaviors. Good luck! RIM is going to be in much worse shape than Nokia sooner than they would like to admit.
And yet there seems to be a real value to this convoluted partnership. One that is based on fear and the need for survival.
Now if we could only assure “razryadka” (détente) all they need is to replace Balmer and bring in the ex CEO from Nokia.
I fail to see the connection between the British Raj and Nokia. One failed due to it’s arrogance and another is going down hill due to complacency.
From your name, I presume that you are a person on Indian origin. Hence, I am surprised to note that you subscribe to the view that the British “gave” India it’s independence. Sure the British were weakened by WWII. But, in my view it diminishes the sacrifices of millions of freedom fighters during the freedom struggle in India.
PS: Did you attend school in India ?
Great, great analysis! And sad to acknowledge…
I completely agree with your logic. I wonder for whom Mr. Elop is working for Nokia or Microsoft.
Om: a very perceptive comment! We have reproduced your blog on the Nokia-Microsoft partnership as a special feature on our portal http://www.indiatechonline.com/end-of-nokia-raj-79.php
Its gonna end like MINOLTA is no more into Cameras. Sad…..
I wonder if Android really is a Smartphone standard, though?
Over here in London when you see an Android phone on the Tube etc. it’s a rare thing – they are almost exotic things. Pretty much most people who have a smartphone have an iPhone.
I’ve never ever seen a Windows phone in the wild, so in the Uk at least Nokia and MS have an uphill struggle, I feel.
People said that Samsung could not successfully market a new mobile OS, Bada.
They were proved wrong. Bada is doing quite well for Samsung.
I mention this because MeeGo is an exponentially bigger and more capable project than Bada ever was, and MeeGo would have been licensed to other OEMs.
MeeGo could have worked. Now Elop has destroyed it.
Elop comes from the biggest hater of open-source, Microsoft. Elop doesn’t understand or appreciate open-source. The reality is, if anyone wants to come late to the mobile market now, open-source is the only way it is going to happen.
Microsoft is late, and it has the most locked-down OS ever. It has an archaic licensing model that will no longer work. Windows Phone 7 had a reported half-billion-dollar marketing budget (the biggest for any product from any company), yet it flopped.
Microsoft said Windows Phone 7 had 2 million shipments. Normally sales to consumers would be about 20% less. However you can assume that Microsoft’s consumer sales and activations are way below that, as Microsoft is too embarrassed to reveal those numbers.
Elop said that all Nokia phones will come with Microsoft services and Bing. Will any consumer want a MeeGo handset packed full of Microsoft ware? No.
Its sad to see the completely inept Elop destroy Nokia’s future. Ballmer and Elop get the awards for the most inept managers of mobile platforms, ever.
Here’s the thing:
Could Nokia have adopted Android? Sure. The problem with that though is they would have to retain a large developer team to constantly migrate core OS updates to their device-specific distribution. That takes time and money.
WP7 is a much more business-savvy choice because Microsoft pretty much does everything, short of writing the hardware drivers. Nokia saves a PILE of money by manufacturing the hardware and allowing WP7 to be installed. It’s really a win-win for both companies.
I wrote a blog on my feelings on the subject, feel free to check it out here: http://www.brafton.com/blog/nokia-and-microsoft-a-mobile-marketing-partnership-made-in-heaven-800399190
Feel the same. Picking Microsoft is end of the world for Nokia. I am not sure, is that hard to embrace open source like Android? What make them think MS Mobile is better to go? I think it has to do with the internal confusion! There are a lot more complex when come to which platform to go. Samsung is a lot more clear cut strategy, winning the market. I think Nokia still doing well in sales, there lot of loyal users out there. Normal user don’t care which platform to go. Those who make call and sms represent the world largest mobile users I believe.
Well good luck to Nokia. For my world Nokia seem to work well. But without Samsung is something cant live without. Sammsung has create low cost mobile both Android and Bada. That is what comsumer want. Not everyone afford or willing to spend on iPhone. The market appeal for lower range of Android. Samsung did it very well.
The Roman Empire, The British Empire, The Nokia Empire – Nothing Lasts Forever 🙂
After a long time got the true feeling of Old GigaOm Blog. Excellent post, keep them coming atleast once a month.
The premise here is that “Nokia” is a lone entity, whereas, the metaphor should be more akin to “what if China and Russia got into bed together after WWII?”
We are now dealing with a combined Nokia/Microsoft entity in mobile (with a lot of Microsoft dollars flowing through it). Microsoft needs a massive mobile presence if many of it’s business units are to thrive over the next decade. Nokia is giving it that prospect. Microsoft can and will underwrite losses, as needed, to make this happen.
Look at the real numbers (at least in the US). iOS will probably top out at 10% of the total mobile market (TOTAL). There is no reason that Nokia/Microsoft can’t equal or surpass that. RIM may drop down end up around that same figure. Android will likely be closer to 20% (10/10/10/20) — and, Feature phones will still be in the 40-50% share for at least another 24 months.
Basically, Nokia/Microsoft can be a contender who achieves equal footing to iOS — They can buy their way into that position, without much sweat. Plus, if they make a great phone for 8-14 year olds (affordable, easy to use, with games and even educational value; something RIM, iOS and Android won’t do), they could build up a User-base that sticks with them after they get older.
Couldn’t agree more !
The history lesson by Om is a very good allegory. But Nokia, unlike UK of the 1940s, is (hopefully) on to something, with cash-rich microsoft in the tow.
Samsung developed Bada and they had a good reason to do it (even if it seems a mediocre platform). Why did Elop kill Symbian and MeeGo? That move is suicide. Imagine how low must the morale inside the company be.. Symbian has (had) marketshare as ENTIRE Android marketshare.. how could they blow that up?!
They should have kept Maemo (they never should of partnered with Intel on MeeGo) as their main goal, keep Symbian as “featurephone” brand and only then add WP7 and Android as sidekicks to keep their market share healthy.
It really is disturbing to see how Nokia management is screwed in their heads.. sad sad story.
Youre right! Meego was the first mistake. Maemo was fine as it was. I liked the Qt strategy also, but this makes no sense..
The open-source route was a great marriage with the passionate following Nokia has.
‘Alien Dalvik’ is a Dalvik port to Meego. It allows Android apps to run seamlessly, unmodified and natively on Meego….why was this ignored?
Nokia missed the bus again. They were well on their way to getting their own ecosystem with Maemo, Meego and Qt ….then dumped it to join someone else’s ‘ecosystem’
Great post Om, but guess you should stick to your knitting-and keep history posts out of tech 😉
its a dis-service to millions of Indian freedom fighters to say British “gave” freedom to India. shame!!
Thanks for echoing my sentiments.
With due respect, you guys may be getting a little too sensitive w/words. Sure – India fought for its freedom and the choice of Om’s words may be a little off, the larger point of this article is something else. And you will agree – there are many things in the post Independence India which we should all be shameful about, so this hardly qualifies for such a strong rebuke from you. I’d say, shame the people who are (mis)ruling it today. Om’s article is drawing a broad parallel, let the leaves and forest not get mixed up!
gr8 post buddy….its a good bank of knoweledge..!!!
OM, your wrong on WP7 not having any developers. WP7 market has grown by 30%, with 20,000 registered devs, and now haves 8,000 apps in counting just 3 months after launch, which is pretty damn impressive. I hate to say this, but your basing your assumptions on past errors and not looking at the facts.
Perfect metaphor, Rav. Nailed!
The article is just brilliant.I think Nokia did a bad thing by choosing Windows Phone 7.
Though a gr8 post narrating history,the NOKIA-MICROSOFT deal is a good and will be successful if executed well. Probably you didn’t follow-up with the Q&A session where Elop outlined the experiences been added by the NOKIA team to the ecosystem.
It better we wait to see the first fruit of the partnership but we condemn it to death. I’ll love to use the nokia phone running WP7 when it arrive my country.
You’re giving british empire too much credit to compare it to nokia. Nokia was of great service to the Indians who used it!