The forced marriage between Microsoft and Nokia

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Unless you were in hibernation mode the last few days or were snorkelling somewhere in the middle of pacific you most likely have noticed that Microsoft have swallowed Nokia for a whopping 7.something billion dollars. For those who have kept their eyes open for the past few years you would have noticed this was more of less a forced marriage.

Ever since the early nineties Nokia has been on the forefront of new models, new designs and high quality phones. Were they first observing competition from the neighbour company Ericksson (who later had to hug with Sony ) they successfully slaughtered that intruder however fairly soon after that was taken take off Nokia became sloppy. First the number of new models with increased innovative functions and features started to lag. Secondly the restrictions they imposed on the Symbian platform for developers made those guys running off screaming to Android, iOS and Windows Mobile and in addition to the poor quality and slow development cycle of the OS itself plus that fact they were outgunned by the new emerging mobile OSesĀ  like Windows Mobile, Android and iOS created the strangling status for Nokia to dis-engage from Symbian all-together and opt for choosing a different platform. They sold/licensed the Symbian platform to Accenture and underway got rid of all Symbian developers by moving them to that company as well.

Windows Mobile was the choice Nokia made but in the end they were already too late. Apple and Samsung were dominating the market in addition to some smaller companies like HTC fishing in the same pond Nokia was no longer able to keep up and thus their once so overwhelmingly market dominance was reduced to only a small fraction in just a few years. Given the fact Nokia’s only business is smartphones the sustainability of the Nokia brand was very low. Nokia-Lumia-1020




Then Microsoft. I do have a bit of a love/hate relationship with them. First, and I’m clear in this, they have made my career in the IT industry. I started computing in 1983 right after Commodore released their C64 (great machine that was back in the days) but as soon IBM whacked their first PC onto the market I jump on the MS bandwagon. I’ve had numerous side-tracks with OpenVMS, Tru64, NSK and some other OS’es over the years but there always has been a MS Windows box on my desk. In the beginning with 3.1 via 95/98 to NT and XP resulting in W7 now. (I skipped Vista because that was no software which could be classified as an OS but more a very early dev release which was pushed into the market because marketing wanted so.) On the server side I’ve kept up till W2008 but decided to leave W2012 for what it is. (The emerging cloud market in addition to my professional task require me to spend time in other areas as well.) Microsoft has always had a heart for small computing devices and they started with Windows CE back in the “Palm days” (;-)). The Compaq iPAQ was one of the first devices running this OS and had some very nice features. the development platform was well established so numerous 3rd party apps were available pretty quickly. The problem however was that it never became mainstream and many people did see the Windows CE OS as a smaller brother of the x86 windows variant and they were very reluctant of stability and security issues. Also the timing was a bit off since not many other vendors provided devices suitable for Windows CE it got stuck in limbo. Microsoft did not at first make the move from CE to Mobile and thus were somewhat late on that as well and when Apple launched the iPhone in 2007 and soon after the iPad which also provided the option to share the entire appstore ecosystem including iTunes it became pretty clear that Microsoft was in for a very hard time. The only lifeblood they had was most of all Nokia who decided to use Windows Mobile as their core OS and even though Nokia’s market share was not great the volume of phones they were able to put into the market kept Windows Mobile alive. So in the end you had a struggling company that totally depended on the capabilities of the division of another and vice versa. The decision from both companies to merge is not that difficult to understand in that perspective.

So where now from here? The mobile market is pretty saturated and it will still be very difficult for both entities to keep a foothold in here. The best chances for the combined entity to succeed is to explore other markets which they could benefit from but I’ll leave that to the departing SB and the rest of the smart folks in Redmond.

Cheers,

Erwin

About Erwin van Londen

Master Technical Analyst at Hitachi Data Systems

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