Criticism For Nokia’s Partnership With Microsoft
Nokia Oyj Chief Executive Stephen Elop had a hard time defending his decision to work with Microsoft Corp. as part of the company’s future strategy. The decision to go down the path of a partnership has led to a $7.7 billion decrease in market value of the company over the course of two days. Elop surprisingly appeared on stage after announcing the partnership on February 11th. During a presentation by Microsoft CEO Steve Ballmer at the Mobile World Congress he stressed the importance and the validity of making Windows Phone 7, instead of its in-house Symbian, its primary mobile-phone platform. Competing with Apple Inc.’s iPhone as well as headsets based on Google Inc.’s Android make these measures essential and necessary.
Compared to Elop and Ballmer, Alex Spektor, an analyst at Strategy Analytics Inc., does not agree with their positive attitude and expectations. “The decision to transition its Smartphone portfolio to Microsoft Windows Phone is a risky one for Nokia,” he said. “As Nokia transitions its Smartphone portfolio to an entirely different platform, there is a risk that previously loyal Nokia consumers might abandon the vendor, hurting Nokia’s previously colossal Smartphone volumes in the long term.”