Nokia And Microsoft: One Week Later

It's been a week since Nokia announced its plans to adopt Microsoft's Windows Phone 7 as its primary smartphone platform. How has the industry reacted?
It's been a week since Nokia announced its plans to adopt Microsoft's Windows Phone 7 as its primary smartphone platform. How has the industry reacted?In hindsight, Nokia timed this announcement fairly well. It announced at a capital markets day on Friday, February 11, that it was planning to dump its own MeeGo and Symbian platforms in favor of Microsoft's Windows Phone 7 platform. The initial news was met with shock waves and reverberations throughout the entire wireless industry.

Timing the announcement just days ahead of the biggest wireless conference of the year was the right thing to do. It gave everyone in the industry something to talk about during Mobile World Congress, and gave Nokia's and Microsoft's CEOs the public platform needed to quell doubters and nay-sayers. They made the best of an announcement that was sure to please few.

Intel's Paul Otellini had this to say, "I wouldn't have made the decision [Nokia CEO Stephen Elop] made, I would probably have gone to Android if I were him. MeeGo would have been the best strategy, but he concluded he couldn't afford it."

Intel and Nokia had partnered on MeeGo, which was based on the two companies' mobile Linux platforms, Moblin and Maemo, respectively. Intel was caught off guard by the announcement, and says it will move forward with MeeGo without Nokia. (As an aside, I played with a MeeGo tablet at MWC, and it was absolutely awful. The user interface is terrible. Nokia was right to dump MeeGo.)

Canalys' Pete Cunningham said Nokia had good reasons to choose Windows Phone over Android, and that it probably made the right decision. Had it adopted Android, it would have hit the market more than three years after the first handset makers did. Nokia would have had to rely on hardware to differentiate itself. While hardware is Nokia's strong point, it simply would have been too late.

As it is, Nokia will not be able to get a Windows Phone 7 device to market until very late 2011 or early 2012. That's a full year after the platform launched. Nokia will only be competing with LG, Samsung, Dell and HTC, however, rather than nearly every handset maker in the world.

"They've got every opportunity to succeed," said Cunningham. "It's now just a question of whether together they can execute." I'll say. Executing has been Nokia's largest failing during the last three years.

Throughout the week in Barcelona, most agreed that Nokia's back was up against the wall with respect to its smartphone platform. It simply couldn't innovate fast enough and fell woefully behind Apple, Google and Microsoft. Nokia's only real choices were Microsoft or Google.

The good news for Nokia is that it has been given permission from Microsoft to customize Windows Phone 7 (other WP7 device makers haven't been given permission to do this). Not only will Nokia be able to make changes to the hardware requirements, but the software, as well. Nokia will offer high-level user interface tweaks on its own hardware, and will contribute deeper system tweaks that will be shared with all WP7 licensees. That will help the entire WP7 ecosystem.

Elop defended the decision as the only way to create a three-horse race in the industry. Having Android iOS, and Windows Phone 7 devices competing will lead to better innovation across the all the platforms, which will translate to better smartphones for all of us. Eventually.