Nokia-Microsoft partnership: the only chance for the former mobile-phone juggernaut?
As a former cellphone powerhouse, Nokia used to sell around 440 million mobile phones per year, which was around 40% of the total global sales. However, history does not repeat itself. According to the report of the first quarter in 2012, the market share of Nokia has fallen greatly to only 22.5%.
Under the pressure from IPhone and other Android phones, Nokia had already given up its out of date operation system (OS), Symbian, which was the most advanced OS in the 90s. In order to come back in the mobile-phone market, Nokia urgently needs a brand new OS to hit the market. It comes down to three choices: designing an unprecedented new OS, seeking refuge in Android community, or joining forces with the leading software company, Microsoft. Which one is the dominant strategy for Nokia and which one is the necessity for Nokia in terms of graph theory?
The first strategy for Nokia is to create a new OS. Nokia created its controversial MeeGo/Maemo OS in 2010. As no one believed that MeeGo was able to compete against Android and iOS, Meego turned out to a failure. Due to the lack of experience on designing modern smartphone OS, Nokia had no longer been recognized as one of the leading companies in the field of smartphone OS . Therefore, for Nokia, trying to come up with another new outstanding OS is not a good choice.
What about joining Android and adapting Android as its own OS? The second strategy for Nokia sounds plausible. But the answer for Nokia is no. If Nokia chose Android, It is undeniable that Nokia could stop its decline soon, and might even have a striking jump. But as the former mobile-phone juggernaut, the Finnish company was not willing to restrict itself into a small circle and became the second Samsung or HTC. Seeking for a full comeback, Nokia needs to plunder market share from Android, which occupies over 68% of the market share. Thus Android is definitely not a good choice for Nokia.
So the last and the dominant strategy for Nokia is Windows. Since Windows only has 2.3 percent of the total market share, you may wonder why did Nokia choose Microsoft? Microsoft is the world leading and the largest computer operation system maker. The superb potential of Microsoft in the mobile-phone OS market should not be underestimating. The advantages of Microsoft in the field of modern OS just makes up for Nokia’s lack of experience. As a novice software company in the cellphone market, Microsoft is not really an enemy to Nokia. Since Android and iPhone both are enemies to Nokia and Microsoft, as we learnt in class, only when Nokia and Microsoft maintain a friendly relationship, relationship graph among those companies could be balanced; just as the saying “The enemy of my enemy is my friend.”
To sum up, as analysis above, choosing Windows is a dominant strategy for Nokia in terms of game theory as well as a necessity for Nokia in terms of graph theory. The future of Nokia-Microsoft partnership is still controversial, but it is definitely a good thing in terms of increasing the diversity of mobile-phone market.
Source:
http://www.theverge.com/2012/4/17/2954610/why-nokia-chose-microsoft-the-real-deal
http://en.wikipedia.org/wiki/Nokia