Stephen Elop spent two and a half years at Microsoft as head of their business division (aka Microsoft Office). Is 2.5 years enough to build up a serious loyalty and/or a fear of Ballmer? It’s a salient question when you try to decode some of the signals Elop is sending as CEO of Nokia.
More connected people than myself have wrung hands over Elop’s “ecosystem” comment during an earnings call:
[quote]“Nokia must compete on ecosystem to ecosystem basis. In addition to great device experiences we must build, catalyse or join a competitive ecosystem. And the ecosystem approach we select must be comprehensive and cover a wide range of utilities and services that customers expect today and anticipate in the future”[/quote]
The popular conclusion is that Nokia is going to announce a new smartphone OS partnership. The question is: Android or Windows Phone 7?
Ok settle down. You can stop yelling about how much of an idiot I am, and consider these things:
- Google’s app store is broken. They’ve as much as admitted it themselves.
- The iPhone’s app store is not broken, and the attach rate is stupendous, by any measure.
- The Windows Phone 7 UI experience and app store approach is closer to Apple than Google.
So, if you were to choose an ecosystem to go with based on future app earning potential which one would you bet on? You could go either way, but here’s what I’d do if I were in Microsoft’s position right now:
- Free WP7 licenses for Nokia.
- A deal giving Nokia a slice of the App revenue.
Remember, Nokia would get the same (or better) OEM treatment as other Windows Phone 7 OEMs. They can build native apps in C++ for their phones. They can keep the device revenue (and that’s all they have currently). They could, quite conceivably, build and lay claim to the best Windows Phone 7 experience on the market. They’d compete head to head with HTC, LG, Samsung, all the while growing revenue and growing Microsoft’s app ecosystem.
If Elop choses Android, it’s a huge kick in the face for Microsoft. Would he do that?