Nokia sale raises questions about mobile technology says Warwick academic
A MIDLANDS-based academic has raised questions about the future of mobile phone technology following Microsoft’s decision to buy fading phone manufacturer Nokia.
The computer firm has announced it has agreed a deal to buy Nokia’s mobile phone business in a deal worth £4.6bn. Nokia has been struggling to keep pace with the rapidly-changing sector and its sales have been badly impacted by the introduction of the smartphone revolution lead by Apple’s iPhone.
Ronald Klingebiel, Assistant Professor of Strategy at Warwick Business School has researched and consulted on the telecoms industry for more than a decade.
Dr Klingebiel said: “Handset markets are commoditising. The action is in software, apps, and soon these will be delivered online. The emergence of html5 is an early indication. Smartphones will then turn into mere windows to the cloud. There will be little that differentiates one black, rectangular touchscreen phone from another, besides perhaps screen quality and battery life.
“Handset manufacturers without a suitable software platform in the cloud stand to suffer and Nokia is right to divest of its phone business. Blackberry should do the same. As for Microsoft, it remains to be seen whether it can leverage its still significant strength in desktop operating systems and software and migrate its customers to the mobile cloud.”
He said questions had been raised as to why Microsoft had decided to partner Nokia in the smartphone market while purporting to not treat any other vendor less favourably.
“(The) announcement goes to show that they were onto something: Nokia’s dominance of the Windows phone market suggests that other vendors lost interest. There were also questions over Nokia’s rationale for dropping one unsuccessful Linux system for another unsuccessful proprietary system.
“In a winner-takes-all market with substantial network effects, especially as regards appstore ecosystems, a distant third challenger proved hardly the boost to the business Nokia was hoping for. Some people connected the dots and asked whether Microsoft was really preparing to take over Nokia. This is where we are today,” he added.
The new deal will see Nokia license its patents and mapping services to Microsoft. The deal is set to complete early next year after which about 32,000 Nokia employees will transfer to Microsoft.
