Saving Nokia

Saving Nokia

Nokia 3510

Nokia should drop both Symbian and MeeGo and instead adopt Windows Phone and Android. But with a twist.

Symbian has been outdated for years and MeeGo is going to be like trying to mix two operating systems together: a huge mess. Nokia should have bought Palm before HP did and used WebOS but they missed that boat. I am sure Nokia has tried hard to write a new, purpose built operating system from scratch but obviously they have failed.

Some 20 years ago Apple tried very hard to update their MacOS operating system when it was outdated and they failed again and again. Only at the verge of bankruptcy did they decide to buy an existing operating system from an outside company and use that. They bought NeXT and that is now know as OS X and iOS. Not a bad move. Taking a ready made OS eliminates so many risks related to software projects like not knowing when it will be ready, how expensive it will be and will it even work.

There are only two alternatives for Nokia: Android and Windows Phone.

Nokia can not and should not simply move to Android like their competitors. Nokia has avoided Android because they would loose control of the important part: the ecosystem surrounding the phones. Nokia would simply be a maker of cheap hardware and forced to sell at razor thin margins to compete with all the other companies also selling phones with the same Android OS. HTC, Samsung and the other Android makers are selling a lot of phones but at such thin margins that it almost makes no sense.

And that is exactly why Nokia should adopt Android - but only for a few handsets and under a different brand. Nokia could bring out their old brand Mobira and start manufacturing a few phone models under the Mobira brand with Android. They should make it clear that Mobira is part of Nokia (Mobira by Nokia) but still keep enough distance between the brands not to make Nokia Actual seem like an Android company.

Nokia should use their current position as the worlds largets handset maker to mass produce these Mobira Android phones as prices that would eat away those already thin margins of other Android makers. Nokia would make Android handsets simply to keep up their own volumes and ruin the party for all other Android makers. This would force HTC, Samsung and all other Android makers to lose market shares.

Nokia Actual should make an exclusive deal with Microsoft to use Windows Phone 7 in Nokia's phones. An exclusive deal should be possible because Microsoft must be desperate with such a small market share and teaming up with Nokia would easily tenfold Windows Phone's market share. This way, Nokia would have their own OS and ecosystem that no other handset maker would share and Nokia could keep far higher profit margins than any Android phone manufacturer.

There is one problem, however: Windows Phone 7 only runs on high-end phones and Nokia sells a lot of cheaper phones that do not meet the hardware requirements for WP7. Microsoft could make a "light" version for Nokias low-end phones and sell 75 million such phones in a year making it worth the trouble. Alternatively Nokia could simply drop the low-end market that brings in little profit and focus on the high-end market only.