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Moving, Just Not With The Times

The fact is buy-out rumours have been there from the start. In February Nokia and Microsoft first announced their deal to produce Windows Phones. At Mobile World Congress just days later Nokia CEO Stephen Elop had to deny rumours of a buy-out. More than that, having been recruited from Microsoft – he was head of the business division – Elop himself had to deny being a Trojan Horse. As we commented at the time: "we're not so sure".

Our argument was simple: "As it stands the Nokia/Microsoft deal places all the risk with Nokia. If it succeeds, Microsoft succeeds. If it fails, Nokia fails and Microsoft walks away. In the meantime the phasing out of Symbian will inevitably reduce Nokia's market share and significantly lower its value."

This stands true today and we'd be more surprised if Microsoft hadn't looked into the viability of buying the division. There is no rush, however, the plans to phase out Symbian will take two years and during that time Nokia's value is only going to reduce. Make Windows Phone exclusive, combine it with Nokia's hardware expertise, buy the lot and suddenly Microsoft has a similar business model to Apple, RIM and HP.

The sad element to all this is Nokia is now making the right moves, but it is making them too late. It needed a fresh platform, but caused a developer walk out by canning Symbian without consultation and backing MeeGo too late. It opened up to a third party platform though in desperation, rather than freely choosing Android or having the foresight to buy Palm for webOS. It has this week dropped Ovi and successfully streamlined its brand, but only at a time when questions are being raised whether its mobile phone brand may disappear altogether.

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Back in July 2010 we asked: What's Going Wrong at Nokia? 10 months later the answer is clear: the company does move, just not with the times.

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