Nokia – Microsoft deal a bold move: Ovum

Nokia – Microsoft deal a bold move: Ovum

A strategic move by Nokia in the drastically changed smartphones landscape

Research house Ovum believes last week's announced partnership between Nokia and Microsoft is "a bold move, but absolutely the right one".

On Friday, Nokia announced it will adopt Microsoft's Windows Phone as its primary smartphone strategy, and the two companies will also partner on mobile ads (Nokia will use Microsoft adCenter in mobile devices), and on mapping (Nokia Maps will become part of Microsoft's Bing search engine).

Nokia's application and content store will also be integrated into Microsoft's Marketplace.

Ovum Principal Analyst, Tony Cripps, said the move was the right one for both Nokia and Microsoft given the drastically changed landscape for smartphones in the past couple of years.

"There were few short term options available to the company (Nokia) to help it get back on terms with Apple and especially the Android masses, which in 2011 look set to overtake Nokia in terms of smartphone shipments, bringing with it the full wrath of the investor community," Cripps said.

Ironic agreement

Fellow Ovum analyst Adam Leach said it was "ironic" that the sole purpose of Symbian was to stop Microsoft from repeating their domination of the PC market in handsets.

"Nokia now has the opportunity to cast itself in the role that Intel has taken in the Windows PC market as a mutually beneficial, symbiotic marriage between equals rather than as simply a box shifter," Leach said. "However, there remains a danger that Nokia could end up as merely a vehicle for Microsoft and services should it fail to differentiate from other Windows Phone 7 makers such as HTC, Samsung and LG."

Another Ovum analyst, Nick Dillon, said that: "For Microsoft this is nothing less than a coup and the shot in the arm its new Windows Phone 7 platform needed, which despite winning acclaim for its innovative design and user experience has so far failed to set the market alight in terms of sales."

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