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Nokia and Microsoft form mobile partnership

Fri 11 Feb 2011 10:08am GMT / 5:08am EST / 2:08am PST
Mobile

Windows Phone, Bing and adCenter to be integrated into Nokia handsets in the future

Nokia and Microsoft have announced plans to form a partnership in the mobile space that the companies hope will help it compete more effectively against the iOS and Android platforms.

Just days after Nokia CEO Stephen Elop - a former Microsoft exec - blasted the company's performance in a leaked internal memo, the two businesses have joined forces in a partnership that is likely to see Windows Phone, Bing and adCenter integrated into Nokia handsets in the future.

"Today, developers, operators and consumers want compelling mobile products, which include not only the device, but the software, services, applications and customer support that make a great experience," said Elop at a London press conference. "Nokia and Microsoft will combine our strengths to deliver an ecosystem with unrivalled global reach and scale. It's now a three-horse race."

And Microsoft CEO Steve Ballmer added: "I am excited about this partnership with Nokia. Ecosystems thrive when fueled by speed, innovation and scale. The partnership announced today provides incredible scale, vast expertise in hardware and software innovation and a proven ability to execute."

The plans incorporate the following proposals:

  • Nokia would adopt Windows Phone as its principal smartphone strategy, innovating on top of the platform in areas such as imaging, where Nokia is a market leader.
  • Nokia would help drive the future of Windows Phone. Nokia would contribute its expertise on hardware design, language support, and help bring Windows Phone to a larger range of price points, market segments and geographies.
  • Nokia and Microsoft would closely collaborate on joint marketing initiatives and a shared development roadmap to align on the future evolution of mobile products.
  • Bing would power Nokia's search services across Nokia devices and services, giving customers access to Bing's next generation search capabilities. Microsoft adCenter would provide search advertising services on Nokia's line of devices and services.
  • Nokia Maps would be a core part of Microsoft's mapping services. For example, Maps would be integrated with Microsoft's Bing search engine and adCenter advertising platform to form a unique local search and advertising experience
  • Nokia's extensive operator billing agreements would make it easier for consumers to purchase Nokia Windows Phone services in countries where credit-card use is low.
  • Microsoft development tools would be used to create applications to run on Nokia Windows Phones, allowing developers to easily leverage the ecosystem's global reach.
  • Nokia's content and application store would be integrated with Microsoft Marketplace for a more compelling consumer experience.

Nokia, once the dominant force in mobile hardware, has seen its market share fall in the past few years - particularly in the high-end smartphone sector in which Apple is now very strong.

The company also plans to adjust its business structure into two primary divisions, tackling Mobile Phones and Smartphones respectively.

Meanwhile, Microsoft launched Windows 7 last year but face stiff competition from Apple's iOS and Google's Android operating systems.

22 Comments

Graham Simpson
Tea boy

219 7 0.0
Sounds like a win/win.

Posted:3 years ago

#1

Terence Gage
Freelance writer

1,288 120 0.1
Agreed. Microsoft will benefit considerably from this, with the biggest manufacturer of mobile phones on board, and Nokia will also no doubt benefit from the considerable Windows Phone 7 marketing and consumer awareness. Now it's really just a case of Nokia getting some good hardware out there and marketing it as a desirable piece of kit. I'm sure even many ex-Nokia consumers would return to them with the right handsets.

I genuinely believe that with this announcement the smartphone market has now become a three-horse race.

Posted:3 years ago

#2

Wojciech Mroczek
Awesome Content Specialist

18 10 0.6
Glad to see Nokia's finally waking up.

Posted:3 years ago

#3
How strange... a former MS exec that goes for Microsoft's platform... how bizarre uh ?! :)

Posted:3 years ago

#4
Not so sure about the win/win. No doubt that both players needed something in the mobile market, but this could just end up claiming both mobile scalps. MS have plenty of income outside of phones - but Nokia don't.

I would have preferred to see Nokia support WP7, but also Android (and with handsets, etc). Nokia could have paired themselves up with Google, and become the dominant Android handset manufacturer.

IMO, the only real (significant) hope for WP7 is business/enterprise customers, which places them against HP (Palm) & BlackBerry.

Anyway, sounds like things are about to get interesting - and it looks like Android has claimed a big scalp already.

Posted:3 years ago

#5
They need each other right now.....badly

Posted:3 years ago

#6

David Bachowski
VP Business Development

66 0 0.0
This is wonderful news - exactly what they both need right now...

Posted:3 years ago

#7

John Donnelly
Quality Assurance

313 38 0.1
I for one am glad Nokia is not jumping on the Android bandwagon.
We need more than 2 Phone OSes out there to see innovation.

Posted:3 years ago

#8

Ron Festejo
Creative Director

19 0 0.0
I thought this was a really good move for both Nokia and Microsoft... but reports have come in saying that Nokia's shares dropped by 12% after the announcement was made, while Microsoft's remained indifferent.

I have also heard that Nokia considered doing this partnership with Android. I wonder how that would have turned out?

Can't wait to see Nokia's first phones that get released under this new partnership.

Posted:3 years ago

#9
A good move for both companies and expanding mobile innovation I believe

Posted:3 years ago

#10

Richard Westmoreland
Game Desginer

138 90 0.7
@John. Forgotten about WebOS? Don't worry, most people have. Which is a shame because it's beautiful.

Posted:3 years ago

#11

John Donnelly
Quality Assurance

313 38 0.1
@Ron, looks like the MS share price is down 50c from market open on the last trade listed on the symbol.

yes I did forget Palm went their own direction with the WebOS and its been well received.

Edited 1 times. Last edit by John Donnelly on 11th February 2011 3:52pm

Posted:3 years ago

#12

Terence Gage
Freelance writer

1,288 120 0.1
Ron - "but reports have come in saying that Nokia's shares dropped by 12% after the announcement was made"

I don't know a great deal about Nokia's output these days, but could it be because Symbian is an in-house product and it appears that they're basically discontinuing it. If Nokia are going to be working so closely with MS, it may also be expected that some of or parts of their divisions may relocate to the US as well (but this is just speculation on my part), which could affect their share value.

Posted:3 years ago

#13

Alex Marin
Business Manager

3 0 0.0
Am I the only who thinks Nokia as been cheated? He is an ex-microsoft exec but acts as if he still were on Microsoft's payroll.

He has destroyed the nokia-meego project and is putting Nokia at the mercy of microsoft.

Now Nokia will only serve as if it were a microsoft department that only makes hardware.

Nokia is dead because of this, this CEO is playing the Microsoft game, this is the worst single decission that Nokia could have made.

Edited 2 times. Last edit by Alex Marin on 11th February 2011 5:29pm

Posted:3 years ago

#14

Philip Wilson
Project Manager/QA

69 0 0.0
There's nothing odd about a former employee supporting his former employer at his new job. Just because you leave your old company doesn't mean you can't use your connections there to help your new employer (and your self in the process.)

Posted:3 years ago

#15

Terence Gage
Freelance writer

1,288 120 0.1
The reality is: what else would you have suggested Nokia do, Alex? They've been steadily loosing market share for years now and it's widely accepted that Symbian isn't going anywhere. Something drastic was in order to try and claw back some of their former consumers and market, and with a new (and growing) OS on the market and lot of marketing dollars pairing with Microsoft will allow them a platform to attempt their resurgence.

It does not seem that Windows Phone 7 will be their exclusive software ("principal smartphone strategy"), so that could leave doors open for other avenues and/or to approach Google, etc.

Posted:3 years ago

#16

Alex Marin
Business Manager

3 0 0.0
@Terence Gage
1#: Of course what I would never have done is hiring a Microsoft exec, Microsoft has never done well in the mobile business.

2#: I would instantly fired this exec when he released that letter to the company all we have read two days ago saying that the company was a platform on fire. How in the hell is that an intelligent way on motivating your employees?

3#: It is clear to me that some serious disagreements have been going on inside the company lately, some days ago some of the higher long time Nokia execs have left the company, to me clearly because of this new strategic decision.

4#: Stoping Symbian and Meego projects - even with Symbian being worse than iOS and Android - and focusing only on WP7 is putting the company at the mercy of Microsoft's decisions. Nokia will only be a testing lab for new approaches and experiments at zero risk and cost for Microsoft, Nokia will never be able to capitalize on the interesting discoverings (if any come from this alliance), and Microsoft has a lot to win on the other side. Microsoft owns the OS and can then sell it to other phone makers, even the search engine and adds platform belongs to Microsoft. This is just what I would have done if I wanted Microsoft to own Nokia without spending an euro. And of course this is the last thing I would have done if I were a true Nokia exec or stakeholder. Nokia was lost, but this decision is what will destroy it. I would be absolutely angry if I were Finnish. I was a Nokia fan, now on the Android side, it is very sad to see this happening. This is like a plot.

I would have invested all what is needed on improving Meego. They own QT, they know the wireless business, Linux is there, since the creation of the Iphone the have had a lot of time to improve their OS, Nokia has the resources and the money to create an advanced OS, keep investing on Meego at least. In rapid changing technology business one of the most important points is constant innovation, they new the direction to take, open platform to the developers, monetization with apps, games as an important part of the strategy, cutting edge hardware. Hell all of us know that. Nokia has the personality to have its own OS, this decision is the worst.

Edited 3 times. Last edit by Alex Marin on 11th February 2011 10:50pm

Posted:3 years ago

#17

Mika Gorin
manager

2 0 0.0
@ Alex Marin
I totally agree!

Posted:3 years ago

#18

Jamie Watson
Studying Bachelor of Games & Interactive Entertainment

179 0 0.0
win/win for everyone!

MS slick OS combined with nokia's awsome phones (mostly) whats not to lose?

Posted:3 years ago

#19

Aleksi Ranta
Product Manager - Hardware

274 127 0.5
"Nokia has the personality to have its own OS, this decision is the worst."

Nokia has enough personality indeed. But Nokia has also tried for the past few years to get a current OS out of the pitlane. Just hasnt happened. So that doesnt leave Nokia with much of choise does it?
Nokia has stated that with the speed of Meego development at the moment, they were going to get just 1-2 devices out by the end of FY11. So Meego was a No No.
Android, we all know its fragmented and differentiation would be a problem. I totally understand this.

So what choices does that really leave nokia? To sit and wait and hope for Meego to materialize while the rest of the market keeps churning away. Go with Android? Buy Apple? :)

Any valid choice from Nokia at the moment was better than beating a dead horse.
And those valid choices really boil down to one, the decision Nokia has made.

Posted:3 years ago

#20

Lee Hansiel Lim
Game Developer - Unity3D

25 2 0.1
I'm just gonna throw some questions here without thinking much of it (although I probably will once all this has sunk 'in').

I wonder what this means for QT developers? Wider range of development tools to play around with? Or is it the other way around? Or maybe no change at all, just subtle integration of specific tool sets and once brand-specific libraries here and there?

Posted:3 years ago

#21

Andrew Ihegbu
Studying Bsc Commercial Music

451 162 0.4
Well, Nokia has lost in a BIG way.

Thier OS devteam is now useless, thier low level programmers are now useless, they have no use for the IP they spent most of thier money on in the last decade, their CEO looks weak willed, especially after declaring that "switching OS is like peeing yourself to stay warm" in press meetings.

At the very least they should have gone with Android. Its open, non-proprietary structure and linux codebase would mean they could mesh it with the good things from meego and symbian. They could even modify Android to the point of having an Ovi store compatibility.

Alas, they were greedy. Giving all the Ad rights to M$ must have been one hell of a fundraiser, but it will hurt them in the long run. They also picked the OS that is statistically doing the worst out of the 3 modern smart phone OS's. And considering it had the market pretty much all to itself in the days of the PDA, that says a lot.

Posted:3 years ago

#22

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