Wednesday, September 4, 2013

Microsoft to Buy Nokia’s Mobile Unit: Emergence of a Third Player in the Mobile Market?

While the Windows Phone is at the number two position (behind Android) in some markets that Apple has not cared to target aggressively, Microsoft has not tasted big success in the mobile market. Tech pundits have given good reviews about Microsoft’s latest mobile operating system, but it has always seemed that Bill Gates came to the smart mobile party a little too late. As Apple and Android dominate the global mobile market with over 90% of market share, the chances of a third player entering the field and competing with these two mobile giants have gotten slimmer and slimmer.

A Quick Glance at Nokia & Microsoft’s Relationship
When Nokia threw its lot with Microsoft and started manufacturing smartphones that run the Windows 7 and 8, many felt that it was a suicidal move. Samsung, one of Nokia’s biggest competitors in the mobile manufacturing, choose Android OS to run its best mobiles and emerged as one of the biggest forces in the mobile market. Nokia was unable to accomplish similar goals using Windows operating system: it dumped Symbian and used Windows 7 operating system for all its top-tier handsets, but was unable to compete with the iPhone or Android devices.

Just a few years back Nokia was respected as the most powerful mobile manufacturer; today, it is not even one of the top three mobile manufactures. Microsoft too suffered from the fact that none of the mobile manufacturers using its operating system could come up with a series of successful handsets. Technology experts and bloggers have expressed one idea since a long time: Microsoft and Nokia are a good fit and by closely partnering with each other, they can emerge as a force to reckon with. By preparing to buy Nokia’s mobile unit, Microsoft has done what many hoped that it would.

Has Microsoft found the Missing Piece of the Mobile Puzzle?
Microsoft Buys Nokia Mobile Unit to Strengthen its Ecosystem

In a purchase that is set to complete by 2014, Microsoft has agreed to buy Nokia’s mobile unit, and it will also buy Nokia’s patents and mapping services in a non-exclusive agreement. The company will pay $ 7.2 billion in cash. The deal is a lifesaver for Nokia, a company that is steadily falling behind its competitors Samsung and Apple. It can also help rejuvenate Microsoft’s mobile image and help the company manufacture flagship mobile handsets that are specifically created for Windows 8.

While Apple has the iPhone and Android has Samsung’s popular devices that can showcase the best features of the mobile operating system and attract customers, Microsoft doesn’t yet have such a hit device for Windows 7 or 8. While people have not dumped PCs or Windows, Microsoft needs to find its way in a world where people are spending less time on PCs and more time on tablets and smartphones. With this deal, Microsoft doesn’t just get the capability to manufacture mobile, but also gets the skills and patents to create a slew of innovative devices that can help its mobile operating system find its feet in a competitive market.

Through the deal with Nokia, Microsoft has all the ingredients that go on into the making of a powerful and effective smartphone ecosystem: a well-conceptualized mobile operating system, devices that are specifically made for the operating system and an app store. Only time will tell if Microsoft has found the missing piece of the puzzle, but if you are a mobile app owner or a developer, the possibility of a third player giving competition to the existing market leaders is exciting.

Impact on Mobile App Development
Microsoft is the only company that has the wherewithal and background to compete with Apple and Android. Nokia still has a huge fan-following in emerging smartphone markets like India, and this will empower Windows 7 and 8 phones to conquer huge chunks of such markets. Just as Google’s acquisition of Motorola Mobility patents enabled the search giant to manufacture its own devices and safeguarded the future of its operating system, Microsoft’s acquisition of Nokia’s mobile unit will help the company compete more aggressively in the mobile market.

It is notoriously difficult to foretell future in the dynamic mobile market, but the news indicate that Microsoft is going to do all it can to thrive in the world of smart mobiles. We can expect to see a surge in the number of developers building mobile apps for Windows. Also, if the Windows Phone OS gets a bigger market share over the next two years (and it is likely that we will see at least some rise), developers who build apps only for Apple and Android will start building apps for Microsoft as well.

Ready for a Resurgent Windows Phone Operating System?
In the current scenario, most businesses and developers are either building only Apple apps, or they build app for Android and Apple. If Microsoft succeeds in becoming the third player in the mobile market, apps that are already popular on its app store will be the biggest winners. By creating an innovative application Windows Phone OS now, or by creating a Windows Phone version of your existing app, you can profit from a world that has three major mobile operating systems.

Would you like to explore this idea further? Get in touch with us and tell us about your mobile app idea. We would love to discuss it with you! 

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