Will the next great wireless brand destined for the landfill be Nokia? The bargain basement buyout of BlackBerry last week is a stark reminder of how fast-paced the velocity of change occurs in the wireless business. It also shines Klieg lights on Microsoft ‘s absorption of Nokia’s beleaguered handset business.
It wasn’t that long ago — just a couple of years — that Nokia could still boast that it was the world’s largest seller of smartphones. Granted the deceleration started earlier, but Nokia never managed to parlay that early advantage into a sustainable leadership position in that all-too-important category.
Smartphones are arguably the most important technology device to emerge since the personal computer during the last century. Now Nokia’s handset business, which was once a gold standard in mobile wireless telephony, is fighting to stay relevant after recently being rescued by Microsoft, which has agreed to take the handset business off its hands for $7.2 billion.
Microsoft’s acquisition of Nokia’s handset outfit has given some optimists hope that the software maker can emerge as a major competitor in mobile computing. But some critics see the move as more of an act of desperation by both Nokia and Microsoft, rather than a logical step to build a competitive platform in mobile phones.
Personal computer sales, obviously, are in decline at the hands of tablets, smartphones and other mobile devices. In Nokia, Microsoft is chasing a dying business in an attempt to reinvent itself and to convince stockholders that it can still innovate with new products and compete in wireless.
However, the buyout basically transfers the structural problems Nokia couldn’t figure out independently to Microsoft, a company, mind you, that actually has less experience in the hyper-competitive mobile computing landscape than Nokia.
The fundamental problems are still the same. The demand for phones on the Windows operating system simply isn’t what either company had hoped for. For the most part, Microsoft got the operating system right this time with Windows Phone after multiple failures. But again — which is a recurring theme with Microsoft — it may be too little, too late.
Both consumers and “pro-sumers” are already deeply addicted to their iPhones and Google Android phones, dividing western markets essentially into two operating system camps: iOS and Android. Nokia stubbornly stuck with its Symbian operating system way too long before opting to double down on Microsoft’s latest overhaul of its mobile platform.