Market waits for Nokia to join new platform

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Market waits for Nokia to join new platform

Next week's strategy day could usher in radical change in software strategy

By CAROLINE GABRIEL

Published: 31 January, 2011

READ MORE: Nokia | OS | Symbian | Windows Phone

After lackluster results, Nokia needs to do something sufficiently radical to restore confidence in its ability to drive the smartphone market. Too few concrete results have been seen in the two years since it outlined its ambitious web services strategy, and new CEO Stephen Elop has been in place sufficiently long for the markets to expect strong direction. He has appeared and spoken very little in public so far, but his big moment will come on February 11 at the firm's strategy day, when a significant shift in the handset plan is expected - perhaps even adoption of a new operating system such as WP7 or even Android.

Speaking at the company's financial results, Elop said that "Nokia must compete on an ecosystem-to-ecosystem basis. In addition to great devices, we must build, catalyze, and/or join a competitive ecosystem."

The word 'join' set off a flood of renewed speculation that Nokia would sign up for a third party OS. This would not mark the end of Symbian, which has huge - though declining - market share and is well suited to many of Nokia's increasingly carrier-centric policies in emerging economies. But it could mark a multi-platform strategy for smartphones, and raise question marks over MeeGo, the Nokia/Intel platform. It is unlikely that would be canned - it is very advanced and a chance to differentiate in new device formats like cloudbooks. However, it will take a long time to create a full ecosystem and Nokia may look for a quicker fix for the conventional smartphone space, something to sit between Symbian and MeeGo.

Choosing Android would be a shock for political reasons because of Nokia's interest in limiting the power of Google, though it could also use its weight to wrest the agenda from Google somewhat. WP7 would be less surprising - Nokia and Microsoft have become allies in recent years, and Elop has come over from the Redmond firm. But it would force Nokia to pin its high end devices on two unproven OSs, WP7 and MeeGo.

However, the key point is that a multi-platform strategy is not a new direction for Nokia. When it acquired Trolltech for its Qt developer technology, it explicitly stated - and later restated many times - that for now it was focused on Symbian, but its future was to create powerful web and apps platforms, and developer bases, that would run across many mobile OSs. Of course, it is another step actually to make and sell devices running another OS, but Qt remains the centrepiece of the Nokia plan.

The main problem with adopting a new OS would be yet another blow to confidence in Nokia. It would be seen as an admission of defeat in strategic terms, even while it could help Nokia address new segments, notably the US. Samsung is riding high on a multi-OS strategy - Android, WP7 and its own bada - and even RIM may open its BlackBerry products to Android. But Nokia has clung to its own OSs, and there is still power behind its argument that it needs to create a fully integrated environment, like Apple's especially for emerging economies, its growth engine. Of course the firm will be considering other options, but it would be hasty to adopt Android or Windows now - instead Elop needs to make the Qt strategy far more explicit, and hasten the arrival of truly game-changing MeeGo devices.