Ng: Will Nokia work with Microsoft?

WHETHER it would happen or not, it’s worth speculating---whether Microsoft and Nokia would work together.

If you look at the last 15 years, you’ll find that the two most dominant tech companies are Nokia and Microsoft. Nokia dominated the cell phone market for the last 15 years while Microsoft dominated the desktop operating system. Both have been on the list of the world’s most valuable companies the last few years.

But in the market of today’s hottest gadgets---the tablet and smartphone--the two aren’t there. A few years ago, Microsoft was a leader together with Palm in the smartphone market. But now, the acknowledged leaders are Apple’s iPhone, RIM’s Blackberry and Google’s Android system. Nokia is still a leader in low-cost cellphones and in the overall mobile phones market but not in smartphones. Microsoft is probably number two or number four, depending on how you look at it, in the market.

Nokia has marketing clout but its Symbian operating system is nowhere near the big leagues. So what if Nokia decides to produce Windows 7 phones instead? Would that be a dream team?

After all, Nokia can’t do the iPhone and if it uses Android, then there is no differentiator for it compared with HTC or Samsung. Motorola seemed to have realized that it cannot compete on software and choose to swallow its pride and produce Windows and Android phones.

Nokia producing Windows 7 could immediately boost both companies’ chances. It won’t be too hard. Nokia’s current CEO, Stephen Elop, used to be from Microsoft.

Microsoft itself has worked with many phone manufacturers. HTC, Samsung, Dell, Motorola and other phone manufacturers have come up with Windows phones and recently, Microsoft announced that it sold more than 1.5 million Windows 7 phones after six weeks in the market. Microsoft said it was in line with company expectations.

The irony about tablets and smartphones now is that both categories are growing so fast that even if more players come into the market, these players may not be even taking each other’s market share but growing together. In fact, some market analysts predict that next year, there will almost be twice as many smartphones that will be sold compared to this year.

It’s just like the case between Facebook and Twitter. Both seemed to be not in competition but are used together. The rapid growth of Facebook is actually also fueling rapid growth in Twitter.

This seems to be also the case with Amazon’s Kindle e-book reader. At the start of the year, concern was raised that the introduction of the Apple iPad, which can also be used as an e-book reader, could be disastrous to the Kindle, which does not have color and can’t do things like email and games. However, recent reports indicate that Amazon will likely sell eight million units of the Kindle this year, compared to the five million sold last year, for a 60 percent growth. (www.ngkhai.net/bizdrivenlife)