Nokia Is Keeping Things Interesting

Stephen Elop, CEO @ Nokia

Nokia announced today it was making Windows Phone its primary smartphone platform. If you look at the Nokia stock price you might guess that the company just made a fatal mistake.  But, that’s probably far from the case.

Gartner says Nokia currently has about 37% of the smartphone market share, and Microsoft has about 4%.  Two turkeys may not make an eagle as Google’s VP of Engineering, Vic Gundotra, quips but if Nokia can keep the numbers that high with Windows Phone, they’ll make a lot of turkey dinners for a lot of people.

Supper Is On the Table. Eat While the Food Is Hot.

My attitude toward mobile development is this: any platform, any mobile device, any market, any time. If you’ve locked yourself into a single platform you tend to get worried if your mobile platform of choice isn’t king.  I avoid that trap completely by mastering as many platforms as humanly possible.  If it computes and you can hold it in your hand or embed it, I’m interested in it.

With Nokia/Microsoft blending forces, it feels as though me and my clients just gained a few billion potential customers.  Hey – the more mobile marketplaces and platforms for me to write software for, the better.  Nokia and Microsoft in effect are going to open up more mobile software markets globally.  Nokia already has a very strong global distribution and sales network for cell phones.  And both companies have the ability to host and manage vibrant mobile software marketplaces to the world’s masses.

I know that no matter what, regardless of the platform that’s “hot”, I can literally turn around in my chair at work, look at my co-workers and know that a software product can be written for it.  I work daily side by side with crack iPhone and Windows Phone developers.  As a team we round out quite an option for people wanting to get mobile software written: Android, iPhone, Windows Phone, Blackberry, WebOS, Symbian … you name it.  Including devices that aren’t even on the market yet.  Elop and Balmer hinted at their future hardware platforms as well, but that’s another story.

A 100,000 Cooks Are About To Show Up.

In working with Nokia, Microsoft will garner the focus, over time, of more than 100,000 Nokia workers who will want to keep Windows Phone alive.  They’re going to keep the Windows Phone software marketplace alive as well.  And that’s a good thing all around.

And to Elop’s credit, he hasn’t handed the keys to the kingdom over to a Microsoft platform completely.  Nokia is going to keep its own projects like Meego and Ovi alive.  Who knows ….

we may even see a version of Qt available for Windows Phone in the near future.  Now that would be pretty cool.

Why Nokia and Microsoft, You Ask?

That was seemingly a big question revolving around today’s press conference, and David Murphy from Mobile Marketing Magazine asked just that at four minutes, eight seconds (04:08) into the presentation.  Why not Android, he simply asked.  Elop had an answer of course, but it was just as telling about Google as it was about Nokia’s hardware platform.  Elop had this to say:

If we tipped over into the Android ecosystem and there was a sense that that was the dominate ecosystem at that point, the commoditization risk was very high:  prices, profits, everything being pushed down.  Value being moved out to Google essentially which was concerning to us.  So the Microsoft option represented to us the best opportunity to build and lead and fight [emphasis his] through a new ecosystem that we take into the marketplace.  Remarkably complimentary assets that in totality is going to offer consumers tremendous choice and a great option in the marketplace.

This tells me a couple things which I was surprised about, and which Elop and Balmer reinforced at various points in the discussion.

First, Nokia simply seems to have gotten a better deal in working with Microsoft.  There were concessions made on both sides.  Yes, Nokia is going to pay licensing fees to Microsoft for the platform.  But at the same time, there seems to be an arrangement worked out where Microsoft will be also sending money back to Nokia to get access to Nokia’s hardware and software innovations.  Very interesting.

Second, “Remarkably complimentary assets” to me is a code phrase for “Nokia knows its hardware stack limits its choices of OS.”  Nokia can’t afford to choose an OS that won’t possibly work on it’s limited hardware stack.  That would be worse than anything.  I’m grasping at straws here, but it’s possible.

Turkey Dinners Are O.K.  But TurDucken Is Just Wrong.

Put the wrong OS on Nokia’s hardware (current or planned), and you’re likely to get something equivalent to turducken.  Something that technically can be made but just plain sucks.

TurDucken

Elop seems to recognize that Nokia is forced to put a new operating system on its hardware now, and I mean right now, that will function and function well.  It’s very possible that the other platforms Nokia was considering would have demanded too much performance out of Nokia’s hardware to run.  An entire software ecosystem after all, demands a lot of a mobile device.

Whenever I hear an executive at a cell phone OEM speak about fitting a complimentary OS on top of the available and planned hardware, it tells me that the executive is aware of the limitations of his company’s hardware.  That’s pretty smart and realistic.

Time will tell if all this is the right decision.  As for me, I’m just glad to have another mobile marketplace to write software for.

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Image sources: wikipedia, newsmild.com

Nokia’s Precipice

February 10, 2011

Nokia stands in a tenuous spot.  One thing the company does well: make cheap cell phones for the masses.  That should never be underestimated.  It’s a very important part of the cell phone market.  The value of cheap, programmable cellular devices should never be underestimated.  Current smartphones have lots of overpriced, “value added” features as well.  That’s an opportunity Nokia is in a position to take advantage of.  A phone platform just as good as the iOS or Android that sells for half the price would shift the entire market drastically.  And to its credit, Nokia phones were well ahead of their time when they were first released years ago.  So, Nokia is no stranger to this dynamic.

Elop is right though.  Nokia stands on a precipice.  A critical one.  It has to play ball or pack up and go home.  I doubt he will have Nokia do the latter.  So, then, what to do?

They answer may lay in a simple realization: any platform Nokia adds to its current product line is a step in the right direction.  It just can’t be a half-baked attempt.  The hardware stack of Nokia’s phones has to improve too (faster processors, better networking, different form factors, etc.), and it has to be a hardware stack that Nokia can protect.  That takes true innovation these days.

Simply adopting a brand like Windows Mobile to run on old hardware obviously won’t do. That would be a disingenuous way to satisfy certain stakeholders with a nice sounding story.  It wouldn’t pass due diligence tests as a sound decision in the mobile software engineering and product design communities anyway.

As a long time engineer who has worked in this industry since the pre-birth of the Internet, I can say this: Nokia has to take the attitude of any platform, any software ecosystem, any time.  Continue to innovate the hardware stack, be creative, and tune those platforms and software ecosystems to run better on that hardware than any other product offering.

Why do I think that? I actually interviewed at Nokia a few years ago.  I knew the science and the work of the position I interviewed for but I didn’t get the job … simply because I didn’t know enough about the internals of the Nokia platform.  That can only mean one thing.  Nokia’s management has corralled its engineering talent into a myopic immobile work force.  I’ve met some of those engineers at conferences, and they are smart.  But, does Nokia have the management willpower and culture to cut it’s engineers and researchers loose to innovate freely?

Fortunately Elop has recognized that Nokia does face a management and corporate cultural challenge more so than an engineering challenge.  The Wall Street Journal today said it best (p. B5) when it quoted a telecom recruiter:

To truly revive Nokia’s market clout, Mr. Elop should hire smart, creative executives “who understand what it means to disrupt” the norm …

Android, iPhone, and to a lesser degree Microsoft’s mobile platform are the norm.  WebOS has a fighting chance.  That’s the norm today.  Disrupt it.

Notice that none of the press lately, including the Wall Street Journal has talked about the engineers.  Obviously, Elop is setting the stage for change, and Nokia overall doesn’t have “an engineering problem.”  Nokia has the engineering talent and the cash to do what Apple and Google has done many times over.  That talent can simultaneously embrace multiple platforms and take a leadership position through innovation.  Or, they can completely re-invent mobile platforms in unique ways that are open.  Or they could do both.  There’s nothing restricting Nokia to build an open platform as an answer to Android … one that doesn’t suffer from the threat of lawsuits waged by companies like Oracle.

That’s one hallmark of successful smart phone OEMs in the market today … the ability to give engineers the leeway to take bits of hardware and do something with it that’s innovative – the ability and culture to invent new technologies that give us what we don’t already have and take things into new directions.  Another trait of successful smartphone OEMs: the business savvy to get those innovative products into the retail outlets that are the mobile carriers.

Don’t forget, it was the iPhone’s innovative touch screen, a focus on hardware/software quality assurances, and software ecosystem that helped propel that phone to the dominant position it has today.  It was The Beatles of the phone world.  It bridged cultures.  And, it was the deal with AT&T that gave the phone a fighting chance to get into the hands of consumers.

Nokia faces some critical choices in these regards.  Does Nokia create new hardware technologies that make the feature phones more powerful and reliable?  Or, does it try to cram more and more features onto a resource limited hardware stack and risk it all under-performing?  Can it make profitable deals with carriers at the same time?

Nokia will be fine if it makes wild creative decisions, takes chances, involves creative genius from outside the company, and pushes its innovations to market quickly.

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