Nokia and Microsoft Unveil Strategic Partnership to Take on Smartphone Market

Strategic Insights -

Nokia, the world's biggest maker of mobile phones, is teaming up with Microsoft on its Windows 7 phone platform, a move that will challenge the dominance of Apple and Google in the smartphone market. The two companies announced a strategic partnership on February 11, 2011, aimed at creating a third ecosystem in the mobile industry.

Key Takeaways:

  • Nokia has struggled to hold on to its market share in the face of competition from Google and Apple.
  • The partnership with Microsoft will allow Nokia to differentiate itself and create a new dynamic in the mobile ecosystem.
  • Microsoft's Windows Phone operating system will be available on Nokia's handsets, creating a new competitor to Apple's iOS and Google's Android.
  • The partnership is expected to drive innovation and bring together the best services assets on the planet to build a new ecosystem.
  • Nokia will contribute its hard work and ingenuity to the partnership, while Microsoft will contribute its services assets.
  • The two companies are optimistic about the partnership and believe it will create a significant opportunity to drive innovation and improve market share.

Statistics:

  • Nokia controls around one-third of the handsets in the market.
  • Microsoft has a 5% market share in the mobile operating system market.
  • The partnership aims to create a third ecosystem in the mobile industry.
  • Nokia has an 8 billion dollar research budget.
  • The partnership is expected to impact employment at Nokia, with significant inefficiencies in how the company uses contractors and distributes development.

Sources:

  • Bloomberg TV, February 11, 2011
  • Bloomberg News, February 11, 2011
  • Nokia and Microsoft press release, February 11, 2011