

Nokia admits it rejected Android; eyes "billions" in revenue from WP7 deal - adolfoabegg
http://www.mobilebusinessbriefing.com/article/nokia-admits-it-rejected-android

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credo
_> >"A decision to swing to Android would have tilted the mobile ecosystem in
the direction of a duopoly, but we wanted to create a challenger," he said._

It looks like he didn't explain why they wanted to create a "challenger".

imo having three dominant players is better than having two dominant players.
However, it would have been great to get Elop's thoughts on what benefits
Nokia would get from creating a "challenger" and why a "duopoly" was not good
for Nokia.

~~~
ZeroGravitas
I think the Nokia decision was the right one for Nokia, but the given reasons
are BS.

Basically Nokia could have ended the smartphone war by joining with Android.
But ironically, that makes them more valuable to Microsoft. This is just the
same as Microsoft paying people to build apps for WP7, paying Verizon to use
Bing, or paying devs not to release games on PS3 but on a massive, multi-
billion dollar scale. It's a bit tragic when the greatest value your company
can offer is to be paid to not join the dominant ecosystem in exchange for a
cut of a desperate monopolist's war chest, but that's why you need to bring
outsiders with no emotional attachment to your products in to do it.

So basically he wanted to "create a challenger" because Microsoft would pay
them handsomely to do so. And if it doesn't work out, it's not like Android is
going anywhere, so they've got a Plan B. (Though to be honest I think they're
currently splitting the company into two pieces, the bit that will wring any
remaining revenue from Symbian then close, and the bit that Microsoft will buy
once they've sacked anyone Microsoft doesn't need. Microsoft will then try the
PlaysForSure -> Zune thing again.)

~~~
colinplamondon
Desperate monopolist? They have 5% market share on mobile.

~~~
sethg
They are a monopolist because most of the world depends on Windows and Office.

They are desperate because they know that in the long run, Windows and Office
will be irrelevant.

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Toucan
"Nokia was unable to give a firm timeframe on when its first WP7 phone would
appear but it is hopeful for a launch before year end."

I find this very telling. As far as I can tell, Google made the first public
announcement of the Open Handset Alliance in November 2007 and HTC released
the first handset in October 2008.

Nokia and Microsoft who should both have more experience and resources
specific to the mobile industry than HTC and Google did in 2007 are "hopeful"
to even meet this timescale, let alone beat it.

In a year, Nokia will have even further to catch up. I'll admit I may be
underestimating the difficulty of getting a new device to market, but it seems
to indicate an aversion to risk-taking which may set Nokia even further back
than they need to be.

~~~
jlgosse
Agreed. By the end of the year (early next year), we're going to have Android
devices with 2, 3 and maybe 4-cores, as well as a version of Android that no
one could guess at right now (2.4, 2.5, 3.0, 3.1, 4.0 maybe?). Apple is going
to be the same way. I can't imagine Apple not announcing new iPhone(s) and a
new iPad this year in order to compete, so anyone who isn't rocking new
hardware by the end of the year is going to get left behind. I'm looking
specifically at Nokia and RIM, whose current phones are so outdated that it'd
be embarrassing NOT to release something spectacular this year.

~~~
nextparadigms
RIM has already "leaked" most of their planned high-end phones for this year,
and none of them look spectacular.

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chris_j
It's not entirely clear what Elop means by "value transfer". My initial
reading was that Microsoft would just be writing a big fat cheque to Nokia in
exchange for Nokia using WP7. It sounds like it's actually something slightly
more subtle but I wonder what it will boil down to.

~~~
neworbit
It means "we can cut staff and save billions"

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teyc
I spent some time today looking at youtube videos of Nokia's Symbian OS, and
also looking through the shopping catalog.

It just makes me reminisce the fact that Nokia makes good reliable phones. In
contrast Hua Wei phones I saw don't have the same build quality.

The Nokia wall papers are tastefully selected, but the standard Nokia fonts
are looking a bit tired. I mean even Motif was good looking in its days, but
human nature demands that these be refreshed regularly.

Nokia would have done just as well selling Android or refreshing it's Symbian
OS. Anyone care to explain what is wrong with Symbian?

I own an Android now, but I would have bought a Nokia android if it was
available.

By the way, there is a long write up on what's wrong with Symbian and Nokia
back in July 2010 by a Symbian-Guru.com editor as he decided to move to
Android instead. [http://www.symbian-guru.com/welcome/2010/07/symbian-guru-
com...](http://www.symbian-guru.com/welcome/2010/07/symbian-guru-com-is-
over.html)

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hessenwolf
I totally would have bought a Nokia android. WTF is a 'Samsung' anyway?
Opportunity missed, and now I would happily buy a samsung again.

~~~
joelhaasnoot
Not sure about that. My significant other constantly complains about my phone,
and I have to admit my Samsung Android phone is not rock solid. Yes, I'm
running a 3rd party version of the OS, but the Samsung version was slow, buggy
and two versions of Android behind. She switched from Android (ok, it was
Samsung's first Android phone, and was pretty awful) to Nokia/Symbian and was
very happy.

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Tichy
They did it out of the goodness of their hearts, because it is better for the
world if there isn't a duopoly? Yeah right...

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yaix
> to sell any personal shares he still owned in Microsoft as soon as he was
> allowed.

This is hilarious. The Nokia CEO inked a contract with his ex-employer MS that
benefits MS hugely while still owning shares of MS. Um... what?!

If it smells like a duck, and walks like a duck, and quacks like a duck... oh,
well.

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jeffb
"he also talked up the significant “value transfer” in financial terms that
would come Nokia’s way as a result of reduced operating expenses and new
revenue streams such as access to Microsoft’s search and advertising
capabilities."

Wouldn't these two "value transfers" have occurred with Google? Nokia's
operating expenses might have been reduced even further if they'd gone with
Android (free) instead of WP7 (which they are paying to use). Wouldn't Nokia
have gained access to Google's search and advertising capabilities if they'd
gone with Android?

I don't know if Google or Microsoft is better for Nokia, but this article
doesn't make it sound like Elop had any convincing reasons for his decision.
It sounds like Nokia agreed to give Microsoft money (WP7 fees), but they
haven't actually agreed on anything concrete that Microsoft will give Nokia
yet?

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apetrovic
> Nokia's operating expenses might have been reduced even further if they'd
> gone with Android (free) instead of WP7 (which they are paying to use).

MS fee is what? $10 per phone, probably less for Nokia? But, do anyone
actually think that Android is free? Sure, it can be free if you're some cheap
Chinese factory that just slaps the latest commit from Android repository on
their handset, but key Google applications aren't open sourced, and to get
them you need to make a deal with Google ("Google experience" apps, support,
etc), which I doubt is free.

On top of that, if Nokia wants to differentiate itself from said Chinese
manufacturer, they need to build some custom UI on top of stock Android (which
probably everyone will hate, but that's the way of doing things in Android
world). And to support that UI on couple of future Android releases in timely
fashion for each handset, to avoid angry mob with obsolete phones mere months
after the purchase (SonyEricsson, I'm looking at you). Developers time aren't
free, and Nokia is notoriously bad at making software, just look at their
Symbian record.

~~~
sethg
Also, if some cheap Chinese manufacturer slaps the latest Android commit on
their handset, _Google makes money_ , because that phone is going to run
Google searches and show Google ads.

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DavidBishop
Honestly, it was a brilliant move by both Microsoft and Nokia. Microsoft
dropped to 3% of the global market share for smartphones and Nokia's 2/3
market share dominance was nearly cut in half
[http://blog.cedowin.com/2011/01/mobile-future-taking-
market-...](http://blog.cedowin.com/2011/01/mobile-future-taking-market-share-
from.html). Additionally, Android overtook the #1 sales spot in Q4 globally,
(depending on who you get your numbers from).

Nokia could have gone with Android, but why? There are already Android phones.
Why be another number? The key to success is not to do what everyone else is
doing but to do something different and find your niche. Microsoft touts
itself as the "business" solution. This partnership of high quality hardware
and business-minded software will set Nokia/Microsoft apart.

~~~
nextparadigms
Would you say the same thing to a PC manufacturer after Windows 95 came out?
Like it or not, Android is already the "Windows" of the phone industry. Going
with another OS, that ust happens to have the Windows name on it, but with a
much smaller market and momentum, is a catastrophic mistake.

What if this is going to be true a few years from now and Nokia fails with WP7
because the Android ecosystem assimilates everything. Will they still be able
to go to Android? They'll be destroyed by then, and it will be way too late
too switch. At least by going Android now, they would have a fighting chance,
and would just need to become a competitive company again, which they haven't
been for a while, even in hardware. Yes, the N8 looked pretty good, and the
camera was nice, but that's about it.

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brudgers
One issue with Android which seems to have escaped mentioned is Oracle's
lawsuit over Dalvik and concerns about how vigorously Google will ultimately
defend the suit given the role Dalvik plays in their revenue model. Two years
ago, adopting Android would not have come with the baggage that it does today.

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nazgulnarsil
three viable ecosystems is better for consumers than two. it also forces more
competition to be dev friendly since apps are a large part of each player's
strategy.

~~~
ekidd
I'm not entirely sure that 3 ecosystems will work out to the benefit of users.
With just two platforms, there's a decent chance that top-selling apps will
eventually be ported to both. But with 3 platforms, you'll see a lot more
market fragmentation and picking of winners. Witness the Wii/XBox
360/PlayStation 3 mess.

And because Windows 7 Mobile allegedly runs a dodgy version IE 7, we can't
make portable applications using HTML 5, either.

So we're really looking at something like 1985, when developers had to pick
between DOS, the Apple IIe, the Mac, and the remnants of the 8-bit
microcomputer market. In this market, the correct strategy was to support a
single platform and hope that it won. Ironically, Microsoft ported Excel to a
huge number of operating systems, and they were eaten alive by Lotus. They've
never made the mistake of fragmenting their efforts again.

~~~
darklajid
Agreed. I love choice, but fragmentation is definitely an issue.

On a sidenote: This "there are two, now with WP7 there are three contesters"
is (by accident? intentionally?) completely ignoring HP/Web OS. So maybe we're
talking "4 ecosystems" now, supporting your point even further.

~~~
stcredzero
Is even the Android ecosystem even viable? Or is it just "a platform we should
also port to for completeness?"

