Microsoft & Nokia Joint Press Conference

The Microsoft & Nokia Joint Press conference has just started. And we're covering it live!

Microsoft and Nokia have confirmed the two companies will work together to take Microsoft's recently released Windows Phone 7 operating system to the next level.

As part of the partnership, Nokia will make Windows Phone 7 their "principal smartphone strategy" (in other words, it's going to be their main operating system for all their phones) with plans to work in partnership with Microsoft on both software and hardware features, focusing first amongst other things on the Windows Phone 7's imaging capabilities. They'll also collaborate with Microsoft on marketing and the Windows Phone 7 roadmap, while assisting with hardware design and language support.

Key points from the press conference:

  • Nokia and Microsoft are working on the OS together, so all partners can benefit.
  • Nokia will differentiate as Samsung, HTC, LG, Dell have done.
  • It looks like Nokia plans to use the lower-end chassis, but also attack the high-end market.
  • Nokia sees WP7 as new enough for them to enter with a fighting chance... Android, whilst exciting, was too competitive already.
  • Nokia will cut employee jobs, and R&D funding, but expects higher returns on spending.

Read our liveblog for Owen and Brody's thoughts, and some of our reader opinions:

 

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35 Comments

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Everybody wants to hate on MSFT, which seems kind of silly to me. But most of them probably use Windows. Go figure.

You can say what you want about Google and Apple, but Microsoft has been in the business for a long time and they know what they're doing. Let's just keep it at that. Nokia has always made great hardware, and with the beautiful software of Windows Phone, it's going to look great.

A few hours after this announcement Nokia's shares hit the floor. It dropped with almost 10%.
Nokia... you deserve better than a M$ alliance!

great news, but I think the bigger news is merger of ovi markets and mapping tech. Ovi markets alone should fix the wp7 international marketplace shortcomings

blahism said,
great news, but I think the bigger news is merger of ovi markets and mapping tech. Ovi markets alone should fix the wp7 international marketplace shortcomings

That's a very good point. Navteq is already used, but perhaps the holes will be filled in.

This is a desperate measure that may work out for Nokia. But every time I see jobs being cut and R&D expenses lowered, I feel bad. So, to me, RIP Nokia for good.

Rash said,
This is a desperate measure that may work out for Nokia. But every time I see jobs being cut and R&D expenses lowered, I feel bad. So, to me, RIP Nokia for good.

So you prefer that companies go eventually bankrupt and everybody loses their job?

AtriusNY said,

So you prefer that companies go eventually bankrupt and everybody loses their job?


This deal with Microsoft could do exactly that. This is Nokia decapitating themselves in the hopes that a more streamlined organization that don't develop their own OS and software anymore could perhaps survive. It's a desperate measure that will in one blow make Nokia no longer build on unique software, but Nokia didn't have the economy anymore to keep going their own path. Now they will suddenly compete with all other WP7 phones, with some crazy overhead costs due to building for no less than THREE mobile operating systems. WP7, Symbian, MeeGo. The latter two will probably go - along with staff. The rest of the staff may also go if their shareholders think this was a too desperate move. This affair transforms the company Nokia, and it depends on what they think about that. That their stock instantly fell by 9% is telling of the uncertainty today.

Northgrove said,

This deal with Microsoft could do exactly that. This is Nokia decapitating themselves in the hopes that a more streamlined organization that don't develop their own OS and software anymore could perhaps survive. It's a desperate measure that will in one blow make Nokia no longer build on unique software, but Nokia didn't have the economy anymore to keep going their own path. Now they will suddenly compete with all other WP7 phones, with some crazy overhead costs due to building for no less than THREE mobile operating systems. WP7, Symbian, MeeGo. The latter two will probably go - along with staff. The rest of the staff may also go if their shareholders think this was a too desperate move. This affair transforms the company Nokia, and it depends on what they think about that. That their stock instantly fell by 9% is telling of the uncertainty today.
Nokia still made €2 billion (profits) in fiscal year 2010. With that in mind, and knowing that they outspent even Apple in R&D by a large margin (over 200%; source: http://digitaldaily.allthingsd...ive-rd-spend-are-you-nokia/ ), then you can tell they have a lot to play with.

They will still be developing their own branding, and becoming a hardware manufacturer has worked out quite well for the likes of HTC. As a fan of the WP7 platform, Nokia just came onto my radar. Before, I would have never considered them. The same could have been said had they jumped to Android (well, for other people, as I do not like Android in its current state).

Nokia has tons of developers. Unfortunately, as Nokia rounds down Symbian, some of them will probably be on the way out. But, as their CEO pointed out, they still expect to sell another 150,000,000 Symbian devices. That requires support, and it will for awhile. In the mean time, teams will certainly shift toward developing a unique experience on WP7. By leveraging their existing technology portfolio, they should be capable of rapidly becoming a powerhouse in the WP7 market. At the same time, they reserve the right to continue R&D on other platforms. And as I pointed out, they have had plenty of R&D going around.

MeeGo is dead in Nokia's eyes, and everyone elses for that matter. From watching the conference, it appears that they will also be looking toward expanding into the tablet market at some future point.

Finally, they hold the exclusive rights to modifying WP7. I honestly hope they do not, with the exception of maybe a few drivers or fringe capabilities (superior Bluetooth support would be welcomed), but they hold that card.

Short term, I believe that Nokia will be laughed at for this decision because WP7 is the current whipping boy of the blogosphere. In time, once Microsoft gets its act together and releases the current lineup of planned updates, then it will be a platform to reckon with, and Nokia will be able to ride the wave by getting in early.

And if, in the long term, WP7 flops, then they can always jump onto the Android bandwagon. It would hurt their bottom line, but it would be doable for a company of that size to survive, probably with some casualties along the way. Either way, Nokia clearly has not been good at developing their own platform (or ecosystem, as they liked to emphasize), and allowing them to put that R&D toward other ventures should help them grow into a different type of powerhouse.

I'm both curious and interested to see what kind of hardware they churn out, and I fully expect them to use their exclusive modification rights to drive into lower price markets, as well as release some pretty hot hardware. Hopefully we'll see on Monday what Microsoft has in store. The phone wars just got a bit more exciting because another titan of the industry just woke up.

daniel_rh said,
Microsoft needs a lower-end market and Nokia can offer this

No Nokia cannot offer it! The reason is like I said they have very very strict minimum hardware requirements that makes the phone very expensive. Ex: 1 GHz Processor, Capacitive Screen 3.7"+ and bla bla... that makes the phone expensive, you cannot make $250 phone with that specifications.

Microsoft has strict hardware conditions for WP7. With that prices of WP7 are very expensive for a common man and that puts phone in league of iphone, galaxy S. For common man no contract phones should be between $100 to $400. It will be challenging task for Nokia to put the hardware in that price tag and capture the market. The current sale of WP7 is not that good as per the current selling vendors.

Pauleh said,
Well I just hope they make it backwards compatible with my 3210.
They'd at least better come with snake pre-installed!

I think this is a great strategy.. Nokia is good at advertising, hardware & pricing, WP7 has got good reviews, is being updated fast, The combined power will be greater than the sum of parts.. Also, Microsoft gets a fantastic global distribution chain...

Desperate move from Nokia. Will probably leave them even further down in the mobile phone market after this, no one wants to buy an half-baked phone.

Wonder what values are behind the deal and how much Microsoft payed to buy Nokia's name, must be an incredible sum of money.

Lechio said,
Desperate move from Nokia. Will probably leave them even further down in the mobile phone market after this, no one wants to buy an half-baked phone.

Ignorance is bliss.

MicrosoftFanatic said,

Ha ha no one wants to use a Fugly and Unusable OS like LinSux. That's why it has less than 1% market share. Windows 7 FTW. Windows Phone 7 is the greatest smartphone OS ever.

What does this have to do with Linux?
Your comment is full of hipocrisy. How much share does the Windows Phone 7 have...? That alone makes a good or bad OS right?

Lechio said,
Desperate move from Nokia. Will probably leave them even further down in the mobile phone market after this

"Futher down"? Mabe even down to the Apple's level which is less than a half of Nokia's? Not going to happen.

RealFduch said,

"Futher down"? Mabe even down to the Apple's level which is less than a half of Nokia's? Not going to happen.

Revenues matter more than market share though.

RealFduch said,

"Futher down"? Mabe even down to the Apple's level which is less than a half of Nokia's? Not going to happen.

I could be wrong but Nokia marketshare is mostly constituted of cheap phones that can't really be considered as smartphones. Anyway here in canada when i go to a store and look at real smartphones there's no nokia phones around.

LaP said,

I could be wrong but Nokia marketshare is mostly constituted of cheap phones that can't really be considered as smartphones. Anyway here in canada when i go to a store and look at real smartphones there's no nokia phones around.

... California has a larger population than Canada has and what the USA doesn't have nearly as many people as Europe/China so what Canada does or doesn't have is a very small percentage of the actual market share.