Saturday, September 1, 2012

Nokia Corporation (NOK), Microsoft (NASDAQ:MSFT) Have to Seize the Opportunity

On September 5 when Microsoft Corporation (NASDAQ:MSFT) and Nokia Corporation (ADR)(NYSE:NOK) host their joint event, there will be a lot at stake for both companies.

For Nokia, which lost its decade-long position as the world's largest mobile phone maker to Samsung, this is a last ditch chance that it has to regain its market share in a segment that is dominated by Samsung and Apple.

The Finnish handset maker is expected to launch its next generation Lumia phones, building on the favourable response that it received for the first few phones in the series.

If the new Lumia phones do not appeal to consumers when they are unveiled next Wednesday, it could mean the end for Nokia, and a serious blow to Microsoft's attempts to regain its footing in the mobile market, analysts and investors said.

Nokia's share of the global smartphone market has plunged to less than 10 percent from 50 percent during its heyday before the iPhone was launched in 2007.
So far as Microsoft is concerned it is crucial that its new Windows Phone 8 get a better response than its last version, Windows Mango. Apart from Nokia, which uses it for its Lumia range, there only a handful of other handsets that run on Windows mobile operating system now. 

For Microsoft, a successful Lumia launch would convince more handset makers and carriers to support its latest phone software, which is based on the same code as the upcoming Windows 8 computing system, and promises faster performance and a customizable start screen.

Windows phones have only captured 3.7 percent of the global smartphone market, compared to Android's 68 percent and Apple's 17 percent according to Strategy Analytics.

For both Nokia and Microsoft - which have decided to partner each other - this alliance has to succeed for both their future growth and prospects, at least in the mobile devices segment.

This launch by the companies comes at a time when the Google-Samsung partnership seems to be bit shaky after a court verdict last week that held the Korean handset maker guilty of violating Apple patents. Samsung also faces a potential ban on the sale of several of its devices in the United States.

The whole climate is just favourable for Nokia to make its move and capitalise on the opportunity that has opened up.

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