Nokia jumps into the Windows Phone abyss

In turning to Windows Phone 7, Nokia's new Microsoft-derived CEO has made what is sure to be a company-killing move

Nokia has been flailing in its mobile efforts for years. While periodically releasing innovative hardware, it has continued to rely on a creaky old operating system, Symbian, that Nokia ensured would stay creaky by turning it over to a bureaucratic open source process. Meanwhile, the Apple iPhone and Google Android platforms have transformed the mobile industry in a matter of a few years.

Earlier this week, new Nokia CEO Stephen Elop told his employees the company was in serious trouble, saying Nokia was on a "burning platform" and needed to jump -- which industry analysts interpreted to mean Nokia would jettison both Symbian and its dead-end MeeGo joint OS effort with Intel.

Today Elop pulled the trigger and announced Nokia would rely on Microsoft's Windows Phone 7 OS for its attempt to regain relevance in the smartphone market. But in true Nokia fashion, Elop is taking the company down several paths at once. Not only will Nokia develop smartphones based on Microsoft's highly immature Windows Phone 7 -- a colossal mistake for Nokia -- but it will continue its muddled Symbian and MeeGo efforts as well. Previously the head of Microsoft's Business division, Elop was brought in this past fall to end the previous regime's indecision, contradictions, and complacency. It appears little has changed.

Windows Phone 7, of course, is a severely disappointing mobile OS that lacks basic capabilities such as cut and paste -- despite coming out more than three years after the first iPhone. It has sold fewer than 2 million units (Microsoft won't say how many) since its release and holds less than 0.7 percent of the market. This is Nokia's platform for growth? It's more like a plunge from a burning platform into a watery abyss.

And what of Symbian and MeeGo? It appears Symbian will continue to be used for not-so-smartphones, as the OS behind regular cell phones that remain popular, especially in poorer countries, even though the real growth is in smartphones. Fair enough. MeeGo's role will likely be in Nokia tablets, as Windows Phone 7 doesn't support tablets and Microsoft has been clear that it never will. But even that role is doubt for MeeGo, as Nokia said the open source project was being changed to develop unspecified future mobile technologies -- what seems to be a polite kiss-off to its partner Intel.

What this means is Nokia will continue to have a fractured strategy, relying on a new lackluster OS (Windows Phone 7) for its growth, a dying OS (Symbian) for the shrinking "dumbphone" market, and (maybe) an unproven, unfinished OS (MeeGo) for the high-growth tablet market. No wonder Nokia's stock prices fell today.

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