Russel Winder's Website

Nokia performs hara-kiri

Today we are formally informed of the astoundingly unsurprising news that Nokia will in future only make Windows Phone 7 smartphones - unsurprising of course ever since the appointment of a Microsoft employee as the president and CEO of Nokia.

This tie-up is a potential life-saver for Microsoft in the mobile space, and for Steve Ballmer. Microsoft risked total decimation from the mobile space without some form of strategic action. After all who wants a smartphone running a desktop operating system? Answer: very, very few manufacturers and even fewer customers. Ballmer has tied his future at Microsoft to Microsoft's success in the mobile space, so he desperately needs some success. What better than to hamstring the current number 1 vendor in the space on the assumption that people will continue to buy from that vendor. A very good gamble for Microsoft and Ballmer, since they have almost nothing to lose and masses to gain.

Nokia used to have Symbian as its smartphone platform and then dropped that for Linux when it became clear that Symbian really didn't have much of a future. It first created the Maemo distribution and then dropped that for the MeeGo distribution when courted by Intel. The problem with this situation is that MeeGo isn't out there on phones like the Nokia N900 yet, whereas iPhones and Android phones are out there in increasingly huge numbers. It seems then that MeeGo has missed the boat, it is MeeGone - at least in the mobile phone space, it is never going to catch up with iPhone and Android, and with Nokia dropping it, who will want it? So for Nokia yet another change of operating system, yet another attempt to create a stable eco-system around the Ovi brand.

iPhone and Android have the zeitgeist, they are the fashion, they have the vibrant eco-systems. MeeGo and Windows Phone 7 have no cachet, no eco-system, no traction. There is no future in dumb-phones, where Nokia currently dominates, the margins are too low. Nokia appears to have decided that smartphone desktop machine sameness is the future - it is banking on the sameness of platform to magically spawn a vibrant eco-system. Unless they create a whole new market, they seem destined to fail: they have missed the point about what iPhone and Android have achieved. Nokia seems destined to collapse as a player in the mobile phone space. Nokia's only hope is that Microsoft cannot afford for them to fail. Will we be seeing a Microsoft marketing campaign as ludicrous as their current one about The Cloud?

I now wish I had never bought an N900, and I certainly won't be tempted by a Nokia phone ever again.

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