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Between the Lines

Larry Dignan, Andrew Nusca and Rachel King

A Nokia, Intel partnership makes sense, but they need to focus on smartphones

By | June 23, 2009, 9:27am PDT

Summary: On Tuesday, Intel and Nokia announced a partnership in which Nokia will use Intel chips in its mobile devices. However, the companies are focusing on building “a new class of devices.” They would be much better off just focusing on next-generation smartphones.

Intel deperately needs to get into the mobile phone market, which is expected to grow far more rapidly than the PC market over the next decade. Nokia, while still technically the leader in global smartphone market share, badly needs to generate some smartphone buzz to help fight off growing challenges from Apple, BlackBerry, Palm, and Google Android.

On Tuesday, the two companies announced a partnership in which Nokia will use Intel chips in its mobile devices. The collaboration will include both mobile chipsets and mobile broadband connectivity. However, the lack of detail provided by the two companies leaves a lot of unanswered questions about how much of an impact this partnership will have on the nascent smartphone market.

Anand Chandrasekher, head of the Intel’s mobility group, said:

“This Intel and Nokia collaboration unites and focuses many of the brightest computing and communications minds in the world, and will ultimately deliver open and standards-based technologies, which history shows drive rapid innovation, adoption and consumer choice. With the convergence of the Internet and mobility as the team’s only barrier, I can only imagine the innovation that will come out of our unique relationship with Nokia. The possibilities are endless.”

In the conference call for reporters, the two companies repeatedly drove home the idea that they want to create a “new class of devices” that transcends the current smartphones, laptops, and netbooks and uses Linux software (based on Moblin and Maemo) to create on open platform. Both Nokia and Intel refused to speculate on any details about potential devices that could emerge from this partnership.

It’s also unclear whether this partnership will lead to a new line of Intel smartphone chips. Intel already has chips for small devices. The “Moorestown” platform is used for what Intel calls Mobile Internet Devices (MIDs), which are basically handheld computers smaller than a netbook but more powerful than a smartphone. But, despite partnerships with lots of hardware makers to build MIDs, these devices have failed to attract buyers in the marketplace.

Nokia also knows something about failed MIDs. Earlier this year, the company discontinued its MID line of the devices, the Nokia N800/N810 Internet Tablet (below).

Unfortunately, the Intel, Nokia partnership announced today sounds like an attempt to resurrect and reshape the MID. That would be a mistake. The market has already responded and said that it does not want that type of device. Users want smartphones on the go and full-fledged computers with roomy screens when they are sitting down to get work done or immerse in computer-based entertainment.

It would make a lot more sense for Nokia and Intel to get laser-focused on building powerful next-generation smartphones. With the N97, Nokia already has one of the most capable smartphones on the planet. Putting Intel chips inside a device like that one would send a message to the market that they’ve got an uber-powerful device that can handle PC-like tasks and lots of multimedia, wrapped in the popular form factor of a smartphone.

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Jason Hiner is the Editor in Chief of TechRepublic. He writes about the products, people, and ideas that are revolutionizing business with technology.

Disclosure

Jason Hiner

Jason Hiner has nothing to disclose. He doesn't hold investments in the technology companies he covers.

Biography

Jason Hiner

Jason Hiner is the Editor in Chief of TechRepublic, an online trade publication and peer-to-peer community for IT leaders. He is an award-winning journalist who examines the latest trends and asks the big questions about the technology industry. He previously worked as an IT manager in the health care industry.

You can also find him on Twitter, , Facebook, and at JasonHiner.com.

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RE: A Nokia, Intel partnership makes sense, but they need to focus on smartphones
ambarishmitra@... 25th Jun 2009
Nokia is struggling and its visible with the no. of things its trying to do improve customer experience of their products but failing succeed. Nokia partnership with intel is probably good for mobile industry from hardware perspective, that does not mean Nokia doesnt have an issue with its platform. Its got a long road ahead of them to compete with iPhone. Its difficult to find a passionate Nokia users.
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Who benefits from this partnership most?
Dietrich T. Schmitz Updated - 23rd Jun 2009
It looks like Intel will benefit most by this 'partnership' with access to Nokia Modem technology.

Intel is faced with the challenge of designing a chipset that provides better technology than ARM. That is quite an 'upstream' current to swim against and is turning into a 'white water rapids' with products like the Netbook and Smartbooks ramping up with SnapDragon Qualcomm chips to name just one ARM manufacturer.

If Intel have 'mask' rights to ARM, then that's a different story.

ARM is the crown jewel and Nokia have years of experience with it.

BTW, I would like to correct you on the Nokia Internet Tablet--it is NOT discontinued. Unless you can cite a source, I believe it was the WiMax version of Nokia Internet Tablet that was pulled but next iteration is due out this fall possibly sporting support for both CDMA and EDGE.

Nokia have the upper hand in ARM-embedded technology.

Thanks.
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Disagree about market for MIDs
scott@... 23rd Jun 2009
"The market" hasn't rejected MIDs. "The market"--people like you and me--have no idea what they are. With maybe one exception, you can't find one for sale *anywhere*. If anything, it is the distribution channel which has rejected MIDs, most likely because it doesn't understand how to position them.

I own a Nokia 810, and it is an awesome device. But I had to go hunting for it before I could buy one. I have NEVER seen the product for sale in any retail outlet, not Fry's, nor Best Buy, nor anyplace else. No wonder it has been discontinued. Nokia has no clue how to sell it.

The one exception I referred to earlier is the iPod Touch, which has been very successful. It is a MID, but it is not sold as such. It is sold as an internet-enhanced media player. I suspect that the forth-coming Zune HD could be consider a MID as well.
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Convert MIDs to Smartphones
linuser 23rd Jun 2009
I agree with the article. MIDs don't make sense, without the ability to make phone calls, send SMS/MMS, etc. The manufacturers of these devices really need to include the standard smartphone hardware (GPS, accelerometer, digital compass, etc.) and run an OS like Android. A couple of advantages to this approach are:

1. They could be sold as high end smartphones, for which there is DEFINITELY a market.

2. They would be more attractive to mobile operators, since operators would be able to generate revenue from phone calls, SMS/MMS, etc., in addition to data contracts.

When key smartphone functionality (phone calls, SMS/MMS, etc.) is supported by Moblin (oFono?), they can migrate to it or offer it as another OS option.
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'Technically' the leader?
Sleeper Service 23rd Jun 2009
You're having a laugh and may want to look at smartphone sales outwith the US. If you did you'll notice Nokia dominate.
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That Nokia N800/N810
The 'G-Man.' 24th Jun 2009
would made a better data only device than an apple iPhone I would say. A secondary device to your normal phone is you like.
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Typical US Blinkers
The 'G-Man.' 24th Jun 2009
You get used to it.
Nokia is struggling and its visible with the no. of things its trying to do improve customer experience of their products but failing succeed. Nokia partnership with intel is probably good for mobile industry from hardware perspective, that does not mean Nokia doesnt have an issue with its platform. Its got a long road ahead of them to compete with iPhone. Its difficult to find a passionate Nokia users.

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