Home > Equities > Non-exclusive Nokia/Microsoft deal is good?

Non-exclusive Nokia/Microsoft deal is good?

Lex (Nokia and Microsoft phone a friend) and many other columns and analysts seem to think the lack of exclusivity is a bad deal for Nokia. Why is it an issue that Nokia didn’t get an exclusive deal with Microsoft on the Windows Phone OS (WP7)?

Shouldn’t Nokia be happy that the deal isn’t exclusive? Look at what exclusivity has done so far to the IT and consumer electronics industry.

Remember Betamax, Sony ATRAC, Mac OS (pre Steve Jobs return) or Symbian, for that matter?

Mac OS in the 80s is a good example. Exclusive to Apple – failed. Windows – open to anyone who wanted to build a PC – won (at least for two decades or so).

Maybe I’m a dinosaur for remembering these and perhaps the world has moved on and exclusive is the new black. However, there is a very recent example showing the strength in numbers and non-exclusive platforms – Android.

Despite it’s flaws, Android was still outselling Apple’s iPhone by a factor of two in the last quarter. Is it possible this wasn’t just down to consumers thinking it was a better OS than Apple’s? Is it possible that it was helped by a large number of different manufacturers flooding the market with new innovative phones, showcasing Android and competing to produce the best possible implementation of the OS?

However, the real question should be if the deal isn’t actually de facto exclusive, just as Symbian became more or less exclusive to Nokia? WP7 certainly looked quasi-exclusive at the presentation yesterday.

How likely is it that HTC, Samsung and LG will continue to focus their attention on WP7, if Microsoft has a new best friend in Nokia? Isn’t there a risk that this deal could alienate other manufacturers and leave Nokia as the only manufacturer for WP7 devices? With the above examples and Nokia’s recent Symbian-history fresh in our minds, the question must be; would an exclusive deal actually be a good thing for Nokia, or the worst that could happen?

Isn’t the only way for Nokia and Microsoft to succeed in the mobile market to really make sure that Nokia is just another manufacturer of WP7 devices? Mustn’t they make sure there is healthy competition from HTC et. al. singing the praise of WP7, marketing the platform to consumers and developers? Wouldn’t this keep Google and Apple on their toes and please operators, to get their backing? Isn’t that how they should develop the third horse in the race for the mobile consumer?

Just a thought…

So, will Windows Phone and Microsoft save Nokia? Now, that is a totally different story…

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