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Microsoft Chief Steve Ballmer – Now He’s Got Nokia on His Side
The papers are full of Nokia’s alliance with Microsoft. The general flavour of most of the coverage is summed up by the headline in the paper version of the Telegraph today:
Ailing Nokia pins its hopes on Microsoft tie-up.
Nokia’s new Chief Executive reckons they are standing on a burning platform and contemplating jumping into the icy waters to save themselves.
And yet, of the two partners, it is arguably Microsoft who need this tie-up more than Nokia. Nokia is still the world’s biggest smartphone manufacturer, with a 28 percent market share last time I looked. Their position at the cheaper end of the mobile phone market is even stronger. Yes, they are losing ground, but they still come into this alliance with a strong position.
Microsoft, by contrast, are an also-ran in mobile phones. They have a new mobile phone operating system, Windows Phone, but their market share of the smartphone market is a paltry 7 percent, and they have had difficulty finding any significant mobile manufacturer to user their software.
While Microsoft’s market share is low, that has been coming off their previous, much weaker, software. The new operating system has received good reviews, and now they have a strong manufacturer who will adopt it. Until now, Nokia’s Symbian operating system has been their biggest rival in this market; now Symbian will disappear.
This is clearly a bad day for Google, whose Android system was also in the running to power Nokia’s new phones.
It is a really bad day for Apple. They have always struggled to make headway in the personal computer market against the Microsoft stranglehold, and now their strong position in the mobile phone market is under threat, both from Google and now from this new Microsoft / Nokia alliance.
This deal isn’t about jumping off burning platforms into icy waters. Think instead of a Microsoft bridgehead into Apple’s territory.
You should never under-estimate Microsoft, as IBM, Lotus and countless others have found to their cost. Their age-old rivalry with Apple has just taken a turn in Microsoft’s favour.