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February 17, 2009 9:57 PM

What Microsoft Should Learn from Nokia



News Analysis. Microsoft and Nokia share similar situations in comparison to Apple. But only one of the two is executing well. Hint: It's not Microsoft.

As expected, yesterday Microsoft and Nokia announced new mobile application stores, Mobile Marketplace and Ovi Store, respectively. Both companies already have tens of thousands of applications, longstanding developer networks and mature mobile operating systems.

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Nokia has huge operating system sales volume, compared with either Apple or Microsoft. Microsoft and Nokia are struggling to reclaim mindshare and to keep developers from abandoning their platforms for Apple's App Store or Google's Android Marketplace. While Microsoft and Nokia share some similar mobile market competitive circumstances, their store strategies are divergent.

Nokia plans to launch the Ovi Store in May, with the N97 designated as the first device supporting the app marketplace out of the box. James Beechinor-Collins writes at the Nokia Conversations blog:

Meanwhile tens of millions of existing S60 and Series 40 devices will be able to take advantage of the store from May. Ovi Store is unique in its ability to target content based on where you are, when you're there, why you are where you are and who else has downloaded similar content.

Now contrast Nokia's store strategy with Microsoft's. The Mobile Marketplace is slated to launch sometime in the second half of the year, but only for Windows Mobile 6.5 handsets. None are shipping today, and the number will be limited to the tens—maybe hundreds—of thousands later this year. Microsoft's store strategy is limited location, which is no way to run a retail operation.

Between now and then, Apple almost certainly will release new iPhone software, hardware and services. The company clearly recognizes just how much a differentiator is the App Store. Last night, while my daughter watched TV while I worked, three different iPhone commercials aired, each touting the App Store. What has Microsoft got? Nothing now and nothing then. Microsoft's application store will be even further behind when it launches later this year.

Nokia, which over the weekend announced a partnership with Facebook, will make social networking one of the store's priorities. That would even be a differentiator from Apple's store. James explains:

Ovi Store includes a "social discovery" feature, which users will be able to activate so content used by their social network peers will automatically be highlighted and made available for download. With tens of thousands of applications, games and videos to offer, this will be a unique way to find and discover new content.
Location aware, Ovi Store will target users with tailored content, based on the users' current locations. This will enhance the social discovery feature further, ensuring users first see the stuff that's most relevant to them.

The approach has its risks, as Facebook demonstrated with a couple ill-fated tailored content approaches. But Nokia already offers some social capabilities using GPS. For example: Contacts on Ovi and the experimental Friend View, among others, including Maps, Nokia Vine geotags content and activities from N-Series handsets.

Already, Nokia is putting together opt-in social networking features that would augment or support the Ovi Store. The devil is in the details, as they say. Nokia promises much, but delivery is what matters—and that's months away.

But social networking marketing has potential, particularly from mobile phones. There's enough market research showing that people—as in folks you know—are the strongest purchase influencers. Nokia just wants to make that influence more influential.

I'm surprised iPhone App Store developers aren't thinking about this concept. For example, Amazon. The online retailer has one of the coolest marketing apps for the iPhone. Sample scenario: Jane shopper is trolling the local mall, where she sees 24 colors of Converse sneakers at Delia's and pattern "Bubbles." The $50.50 price is more than Jane wants to spend, so she comparison shops with her iPhone.

Jane launches the Amazon app and snaps a picture using the iPhone camera. Amazon will try to match the picture to an item in stock. What Jane learns is that Amazon has the sneaks in black for 99 cents less than the white pair she wants from Delia's. If the Amazon app were social, it would notify Jane's designated friends about the search or purchase had there been one. Better: Delia's would offer a geotagged token coupon Jane could send to her friends.

Cell phones are highly personal, and they're used in very personal ways. Nokia is right to look for mobile social marketing opportunities. The Ovi Store sounds promising, which is much more than the almost nothing Microsoft has revealed about the Mobile Marketplace.

Who knows, maybe last week's Zune reorganization will bring some of that "Welcome to My Social" stuff to Windows Phones. But Microsoft had best hurry up. By the time the Social opens, everybody will be sharing and greeting somewhere else.

[Please send your tips or rumors to watchtips at live.com].

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Comments (12)

oiaohm :

Nokia has a trump card MS does not. Cannot beat them join them.

If Android wins out right Nokia will just release Android phones so Nokia stays in business.

Nokia is in the business of selling hardware not software. Sorry any company depending on software to get them threw the crunch is in trouble.

billybob :

If Nokia were Microsoft they would be wasting all their money on removing Ford's air supply because they dared to include a phone built into their cars.

Most companies think "what can we make that people will buy and we will make lots of money from". Microsoft thinks "who is that making money in our industry, how can we kill them and take all that money?"

n0neXn0ne :

smensugh Says :

Tell me, and you have an RSS feed for this blog?

@smensugh :

http://feeds.ziffdavisenterprise.com/RSS/MicrosoftWatch


^o^

smist08 :

Apple has a bit of an advantage that the iPhone and iPod touch are basically the same thing. So say you develop a game for it, then you can sell it to a larger audience than just the iPhone. MS has too big a mishmash of incompatible devices, ie running xbox, zune, WM, Windows, WinCE. Strange since they are all supposedly Windows based yet quite different and incompatible.

oiaohm says :

"Nokia has a trump card MS does not. Cannot beat them join them.

If Android wins out right Nokia will just release Android phones so Nokia stays in business.

Nokia is in the business of selling hardware not software. Sorry any company depending on software to get them threw the crunch is in trouble."
----------------------------------------------------

Totally agree with oiaohm on this, he has nailed it. I would even go further and say that if MS decides to "make" a Zunephone (for lack of any other name) then MS should look for other hardware engineers outside of MS, instead of using the same incompetents inside MS, that designed the hardware of the XBox360.

MS has in the past always paid others to make their hardware, although with the XBox360 they, MS, did the hardware engineering in house. As hardware prices for computers fell, IBM sold it PC business, wisely. MS wisely avoided buying hardware companies, also. But this tactic of only doing software, is now changing into a minus, as software has now got to compete with better free software. The Mobile market is just going be the first causality of software becoming a commodity syndrome for MS.

While I think so far MS has been wise not to invest too much in the future of Mobile, still I have to wonder, as Joe keeps posting about it. Where Joe gets a lot of his MS Mobile posting, I "think" is from MS PR releases, where he speculates about the future of MS cell phones. I would say, that MS needs to get out of this market, as well as abandon the Zune too.

With software becoming a commodity, MS should look at Apple as an idea of how to keep part of their business. MS should buy up a laptop manufacturer, during this depression, at cheap prices. They, MS, should learn and relearn, quality control and testing. and turn out decent above average products unlike the high failure rate XBox360's. They should look into making a new OS, or similar one, on a completely new laptop that only MS will make and sell, in the future, while of course, still continuing to sell windose. The future of MS anyway you look at it is going to be a smaller MS. Desktop OS market share continues to ebb for them, and DRM/Seven/Vi$ta, is just more of the same bad news for consumers, that will further the exodus.

billybob :

Nokia bought Trolltech which owns Qt and does a lot of work on KDE.

http://www.businessweek.com/globalbiz/content/jan2008/gb20080128_783831.htm?chan=globalbiz_europe+index+page_top+stories

I suspect they are planning a new Linux based phone OS of their own. There does not seem much sense in switching to Android because they have a very good system with Qt.

It is more likely that they could get Android apps running on a Qt system than getting Qt apps to run on Android.

rickst29 :

BillyBob's got it; and Joe, I think you missed it.

Although Nokia *already* has vastly more apps available in it's S40/S60 software store than MS does, it looks to me like they've executing a fundamental strategic change-- one which will make them far more attractive to external developers, and one which could further blur the line between 'smartphones' and 'netbooks'.

They've dumped the nasty-to-negotiate 'commercial' license requirement, and have re-licensed Qt under the extremely liberal LGPL. (Which, of course, means that even competitors don't have to fear Nokia pulling the rug out from under QT via future changes in software license terms.) Here's what they, Nokia, say about QT on S60:

"Qt is used extensively to deliver applications to a wide range of desktop, mobile, and embedded platforms. Empowering the S60 platform with the ability to run Qt-based applications expands the opportunities for C/C++ developers to deliver applications to the S60 platform. In addition, it offers Qt developers another option for distributing and selling software."
- - - - -

I don't see Nokia doing a sudden, massive run-away from S60 (or even S40; they will be providing Qt-extended on that platform too). But allowing Devs to create programs which are *the same* on Windows, and Linux, and on S60, with almost automatic integration into the phone-unique platform menus, dialogs, input methods and etc. -- that's POWERFULLY attractive to ISVs.

Right now, qts60 is only in an early pre-release, but "qt labs" has been pushing out more complete prereleases on a frequent basis. The next one becomes qt4.5-based, with s60 menu integration and font management built in.
- - - - -

As for the upcoming store only selling apps based on Windows Mobile 6.5 -- well, obviously, most developers would rather be boiled in oil than develop an App with the current Windows Mobile SDK.

oiaohm says that software doesn't really matter much-- but I disagree. As mobile-oriented chips become more capable (e.g., the upcoming TI chip, capapble of recording 1980p video), and network data services become more rich, the software becomes critical. QT seems to be a much, much richer platform than Java ME; it needs far less lines of code to actually write something; and it's supported cross-platform.

For Microsoft, even with the massively improved Windows Mobile 6.5 becoming available, that's scary.

Gerardo Tasistro :

BillyBob and rickst29, I'd like to add to your point. Qt is also the base for the KDE GUI. Known to be one of the user interfaces for Linux, but as show on the kde.org site:

"KDE software is translated into more than 60 languages and is built with ease of use and modern accessibility principles in mind. KDE4's full-featured applications run natively on Linux, BSD, Solaris, Windows and Mac OS X."

The implication is pretty clear. It doesn't need to fight Windows it just assimilates it. A Qt application can be quickly ported to an ARM processor device or Windows. While a Windows app is stuck in the heavyweights of Vista. Clearly Qt allows them to position products in new devices quicker than Microsoft can.

rickst29 :

Garardo-- strongly agree. Although KDE itself is too "heavyweight" to implement on current smartphones, qt-e will will be providing the most relevant KDE library functionality within itself, allowing for an easy port.

The development horror of the current Windows Mobile release is, basically, that you're writing to a Win32 API-- nasty, unextendable, with unstandardized, error-prone and partially missing getter/setter queries, and a zillion different ways of implementing event listeners. WM-6.5 upgrades this to being more like coding for .NET, which is a really nice upgrade-- but absolutely not competitive with Qt-e. The ease asnd efficiency of coding qt-e is simply amazing.

For example, one of the qt guys, in his blog, talks about a little App which he wrote to show an Oslo city real-time bus route display- and he says that the code to receive the city's WAP data on times and locations consists of only 5-10 LINES of code (depending in how you count "relevant" lines). Never miss the bus again, just look at your cell phone and see which corner the bus is at! Discussion here, with code linked: http://labs.trolltech.com/blogs/2009/02/11/never-miss-the-bus-again-reloaded/

But I'll characterize the relationship with Windows differently: On the desktop, All the KDE Apps will depend on KDE and qt libraries in order to run-- these create a new "platform" for you, just like adding .NET runtime does. Windows isn't ASSIMILATED; rather, it is just IGNORED-- the KDE/qt stack provides just about everything you need to use, you hardly ever need to go all the way down into the Vista API anymore.

But on phones, full-blown KDE widgets probably aren't going to happen. I'll characterize any "phone" which can run full-blown KDE (with plasmoids, etc.) as a "netbook", not merely a phone. Qt-e Apps and and android Apps may be able to co-exist, because both code libraries are open source. But I don't think Win-Mobile will ever support these apps.

MS is building another proprietary island fortress, and developers will probably have to choose between living there OR living in the rest of the world. At a cost of $8 per device license fee, the Win-Mobile 6.5 SDK will have to be massively rich and easy to use in order to compete for ISVs. I hope to see it go the way of the Easter Islanders- ten years from now, computer tourists will look back at the desolate landscape and massive "statues" of hard-to-build, hard-to-maintain, legacy-riddled programming and say, "What was wrong with those people? Any IDIOT would have seen that these license terms, library limitations, and proprietary secrets were gonna be suicidal!"

BTW, Although I talk big and I'm using KDE right now :)), I've never yet written anything related to, or using, qt or kde. Just a user. In a previous life, I worked in scientific computing and "massive" old IBM networking (never desktop stuff).

rickst29 :

Garardo-- strongly agree. Although KDE itself is too "heavyweight" to implement on current smartphones, qt-e will will be providing the most relevant KDE library functionality within itself, allowing for an easy port.

The development horror of the current Windows Mobile release is, basically, that you're writing to a Win32 API-- nasty, unextendable, with unstandardized, error-prone and partially missing getter/setter queries, and a zillion different ways of implementing event listeners. WM-6.5 upgrades this to being more like coding for .NET, which is a really nice upgrade-- but absolutely not competitive with Qt-e. The ease asnd efficiency of coding qt-e is simply amazing.

For example, one of the qt guys, in his blog, talks about a little App which he wrote to show an Oslo city real-time bus route display- and he says that the code to receive the city's WAP data on times and locations consists of only 5-10 LINES of code (depending in how you count "relevant" lines). Never miss the bus again, just look at your cell phone and see which corner the bus is at! Discussion here, with code linked: http://labs.trolltech.com/blogs/2009/02/11/never-miss-the-bus-again-reloaded/

But I'll characterize the relationship with Windows differently: On the desktop, All the KDE Apps will depend on KDE and qt libraries in order to run-- these create a new "platform" for you, just like adding .NET runtime does. Windows isn't ASSIMILATED; rather, it is just IGNORED-- the KDE/qt stack provides just about everything you need to use, you hardly ever need to go all the way down into the Vista API anymore.

But on phones, full-blown KDE widgets probably aren't going to happen. I'll characterize any "phone" which can run full-blown KDE (with plasmoids, etc.) as a "netbook", not merely a phone. Qt-e Apps and and android Apps may be able to co-exist, because both code libraries are open source. But I don't think Win-Mobile will ever support these apps.

MS is building another proprietary island fortress, and developers will probably have to choose between living there OR living in the rest of the world. At a cost of $8 per device license fee, the Win-Mobile 6.5 SDK will have to be massively rich and easy to use in order to compete for ISVs. I hope to see it go the way of the Easter Islanders- ten years from now, computer tourists will look back at the desolate landscape and massive "statues" of hard-to-build, hard-to-maintain, legacy-riddled programming and say, "What was wrong with those people? Any IDIOT would have seen that these license terms, library limitations, and proprietary secrets were gonna be suicidal!"

BTW, Although I talk big and I'm using KDE right now :)), I've never yet written anything related to, or using, qt or kde. Just a user. In a previous life, I worked in scientific computing and "massive" old IBM networking (never desktop stuff).

billybob :

Personally I would not be too sure that Plasma could not run on a phone. There is already a plasma-mid containment. MID is somewhere between Netbook and Smart Phone, its only a small leap to get from there to a phone.

Dataengines are made for a phone because in the long run they use less resources than every app getting its own data. They also make the 'run in background' problem go away.

I think the long-term goal is to make plasmoids which move between the phone and the desktop. I am not really sure why though... Maybe dataengines could feed data from the desktop to the mobile.

macejv :

Nokia has performed great in this crisis period, mostly because its management & marketing strategies, its new products & services, and also because of its relations with all the software & hardware partners. This is something that Microsoft did not done till now. For example, Microsoft Windows has many errors, bugs, and many problems that have been solved by other independent software, such as jv16 PowerTools 2009 by Macecraft. This software is helping thousands of people to use the Microsoft Windows in the proper way, by optimizing it, cleaning the registry, and many other system utilities.

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