Nokia CEO Stephen Elop is making a bold, risky bet in choosing Microsoft Windows Phone platform over Google Android. Will it pan out? Analysts mull the move.
Nokia CEO Stephen Elop bet
the future of the Finnish phone maker Feb. 11 when he unveiled
the plan to make Microsoft Windows Phone the centerpiece of the company's
smartphone strategy going forward.
With its smartphone market
share falling-Google's Android platform out
Nokia's Symbian in the fourth quarter of 2010-the thinking was that
Elop would pick Windows Phone 7 or Google's Android as the core platform to
power its popular handsets.
Microsoft won that
privilege, leading Google Vice President Vic Gundotra to proclaim
before Nokia's Capital Markets Day announcement that "two turkeys do not
make an eagle."
Asked at the announcement
why he picked Microsoft over Android, Elop said: "Our fundamental belief
is we would have difficulty differentiating. The commoditization risk was very
Elop makes a good point.
There are a lot of companies producing Android phones, and Elop fears
Android-based Nokia handsets would have a hard time standing out and therefore
gaining serious market share in a sector where there are well over 100 Android
On the other hand, there are
also a lot of consumers buying these smartphones from the likes of Samsung,
HTC, Motorola and LG. Canalys reported
that Android handsets accounted for 33.3 million of the 101.2 million
smartphones shipped worldwide in the fourth quarter of 2010.
Considering that, Android
has risen to claim anywhere from 20 percent to 30 percent smartphone market
share (depending on whose research one favors).
This is a huge, gutsy bet.
Rather than embrace Android as a company-saving platform, a strategy that has
served Motorola Mobility well, Nokia has chosen Microsoft, whose WP7 allegedly
shipped a meager 2 million units to date. Anecdotal evidence about Windows
Phone 7 devices from AT&T and T-Mobile retail stores does not bode well for
Elop appears to be counting
on the fact that Nokia, with its big brand and massive engagement overseas,
will thrust WP7 to a position of power among Android, Apple iOS and RIM