Nokia Confirms It’s Keeping An Open Mind About Using Android In Future
techcrunch.com
techcrunch.com
The current approach seems to be; 1. Set themselves up as a big player in a smaller market. 2. Wait for the smaller market to grow.
In other words, they're trying to play the long game.
As for the comments about Android, the article is link-bait, pure and simple. Being open to an idea doesn't mean you have any plans to implement it. To use an analogous story, imagine we were colleagues and you mentioned in a conversation that you may work for a different company before you retire, if I was playing TechCrunch's role I'd be going to your boss and saying you were planning to get a new job.
HTC have, for a variety of reasons lost a lot of ground to Samsung.
The question I always find myself asking, is would Nokia have faired better there?
On WP they only have to out gun HTC really, thats it. On Android, Samsung are doing a good job carving out the high end, the mid range, and leaving the low to no profit margin to the Chinese and nock off brigade.
Will Nokia's Microsoft gamble pay off? Who knows, Would it have been raking in the billions if it had gone Android? Probably not, as HTC's problems show.
As others have stated, there's nothing wrong with Nokia building out Windows Phone phones. The issue is exclusivity, which is understandable given the $1 billion a year Microsoft is paying them. I suppose we will see which way Nokia turns once that contract ends (whenever it does end).
WPs market share is dismal, and brands like RIM (and Symbian!) have been losing market share, so it is certainly possible Microsoft can increase in market share. But I think every day that goes by, the chance of it becoming a dominant mobile player recedes. Apple took its place in the market years ago, and Android is now in an advanced state on many fronts - market share, ecosystem etc. Android is in a much more solid place then it was even a year ago, a hold which would be very difficult to dislodge.
One might guess that some of these payments are conditional on Nokia not offering another smartphone platform. If so, that's what Nokia has to lose. Then again, if those payments are also somehow keyed to the size of the Windows Mobile market as a whole (e.g., those map royalties), they might not have nearly as much to lose as both sides anticipated when they made the deal in the first place.
[1] http://www.tomshardware.com/news/Microsoft-Nokia-Windows-Pho...
[2] http://conversations.nokia.com/2012/10/31/frequently-asked-q...
What Microsoft should really do is play Apple's game instead of Google's. Buy Nokia and make their own phones with exclusive access to WP8.
It's Google that plays Microsoft's game, which has been played before and Apple lost.
It's inevitable for Apple to get caught by competition, they are also bad at competing on price and their distribution network pales in comparison to the distribution network of all Android phone makers combined. One or two years ago, people talked about how small the Android apps ecosystem was compared to iOS, but nowadays they are almost on equal footing and eventually Android's ecosystem will get much bigger.
If there's anything Microsoft learned is that hardware becomes eventually a commodity and their Windows/Office monopoly made it possible for them to release one shitty product after another and still have room for recovery.
Apple may be more profitable than Microsoft, but they don't have the same wiggle room for screwups.
Hardware becomes a commodity if you let it become a commodity. That's what happened with PC's and that's why all the sane manufacturers gave up their PC hardware businesses. But Apple is still making plenty of money selling non-commodity personal computers. Apple's margins on "commodity" hardware like Macbook Airs is 25%+.
Moreover, even if hardware becoming a commodity is the equilibrium result, it's not sensible to go from there to conclude there is no money in hardware. In the long run, in competitive markets, profits tend towards zero anyway. The trick is to make money during shifts from one equilibrium to another. The iPod cash cow seems to be dropping off for Apple now, but in the intervening decade they made boatloads of money on that product.
We can argue all day about whether Nokia was right to jump into bed with Windows Phone/Microsoft, but what might be a more interesting question is if they were right to sign exclusively with Windows Phone/Microsoft.
If they had not done so they could have their current line of WP8 devices on the market, and alongside them they could be testing the waters with an Android device or two. Just let the market decide.
Nokia hardware with a virgin Android installation and a handful of custom Nokia apps sounds like an appealing offering. In fact I would buy such a phone if it were available.
A lot of manufacturers have been installing gunk-ware over Android (e.g. Samsung TouchWiz, HTC Sense, etc) making it slow and laggy, and delaying Android updates by between weeks and sometimes years. Virgin Android (or "the Nexus experience") is actually a real selling point for many Android fans and something Nokia could exploit.
Another area where traditional Android phone manufacturers have suffered is that they simply release too many phones. This has confused consumers, weakened their marketing, and split their efforts too widely. If Nokia released no more than three devices per year (small, medium, and large) they could concentrate all of their efforts (marketing and development) in a might smaller area but get much more bang for their buck.
That sounds right for any manufacturer. Somehow though, manufacturers seems to disagree. They prefer lots of devices + lots of tweaks to the OS.
Which from a logical standpoint I can understand, but from a practical standpoint they must see that Nexus branded devices sell almost as well as their "flagship" devices, with far lower investment/maintenance?
It makes me thankful that Microsoft essentially banned manufacturers from being able to skin Windows. Can you imagine PCs today if every manufacturer had a different "user experience" (similar to HTP Sense, Samsung TouchWiz, etc) and then the manufacturers (Dell, HP, etc) had to provide updates...
That's arguably good for consumers - it keeps prices down, and we can easily mix computers from different OEMs. But the manufacturers would much rather be like Apple, with an exclusive interface attracting loyal fans who buy products with greater markup. They mostly suck at implementing it, but the potential rewards are so great that they can't resist trying.
OTOH, I do see consumers developing loyalty to good hardware. SII users that will buy the SIII (or SIV). You carry a phone around, so what it looks and feels like physically is important.
But is there anything actually useful in these software additions? It looks like it's just skins, and maybe some clock and weather widgets. Do people actually say, "I want to buy another HTC/Samsung phone because they have that widget."? Manufacturers actually do add their own software onto PCs as well, but it's all shit and bloatware. The closest to useful software from a hardware vendor that I've seen (outside of the exception of Apple) is software for individual components, like EVGA video cards or ASUS motherboards.
It's like the hardware manufacturers usually don't think about the actual utility of the software they're putting on the PCs/phones, and the only point of it is some kind of brand differentiation. Which is absurd, when you think about it.
My phone comes with the 'Samsung Apps' store. I've never even accepted the Ts&Cs, but if even a few percent of users go there instead of to Google Play, it's probably viable for them to build it.
But it isn't a selling point for Android users- the other 90% of the market that aren't Android fans. Most have no idea what "stock" is, or why they might want it.
Don't you think it's trending towards people knowing though? E.g. N4 being instantly sold out, worldwide. Could be thanks in part to Google's huge campaign both online and on TV for Nexus.
The new Asha devices are pretty good. The way I see, they'll only become more and more important for Nokia as they "evolve" along with the markets where they're sold.
But this is no longer most of the phone business. Nokia used to be in a class by itself, with 35% of the whole handset business worldwide. That is down to something like 5%, and that part is the low-margin business, so margin contribution makes that picture even worse.
The bad news is that $50 Androids are coming and $90 Androids are pretty good. That's right in the Asha price range.
(I know they still have Symbian, but AFAIK it doesn't sell significantly in the western markets and I don't think Microsoft sees it as a threat to WP).
Nokia can market and build a brand on, say, Lumias, rather than the OS.
A Nokia made Android phone will make a whole lot of people happy and will generate a huge demand.
Of course, once upon a time, (Linux-based) Maemo/Meego was the OS waiting in the wings, which they were going to migrate to after Symbian stopped being useful to them, and look how well that worked out.