Nokia: Transition to Windows Phone to take about two years

Nokia: Transition to Windows Phone to take about two years

Summary: Nokia filed on March 11 a form 20-F with the Securities and Exchange Commission which mentions a number of new tidbits about Nokia's smartphone-centric partnership with Microsoft.

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Nokia filed on March 11 a form 20-F with the Securities and Exchange Commission which mentions a number of new tidbits about Nokia's smartphone-centric partnership with Microsoft.

(A PDF of the nearly 200-page document is available on the Web, which I found via a link on GigaOm's JKontheRun blog. If you have problems viewing that one, here's another download link.)

The document confirms that Microsoft and Nokia still haven't finalized the deal, announced in February, noting the pair has "entered into a non­binding term sheet... (while) the planned partnership with Microsoft remains subject to negotiation and execution of definitive agreements by the parties."

There's been some debate as to whether Nokia will be fielding its first Windows Phone 7 devices in 2011 or 2012. (The last "official" word from Nokia was the company expected to start selling WP7 phones in volume in 2012.)

But in the 20-F, Nokia officials said the transition to Windows Phone as its "primary smartphone platform" will take "about two years."

Nokia officials called out 2011 and 2012 as "transition years," during which the company will be moving to Windows Phone and investing "in building a new ecosystem with Microsoft." The ultimate goal is to try to "retain and transition the installed base of approximately 200 million Symbian owners to Nokia Windows Phone smartphones over time," the document said.

What else does the 20-F reveal? I did a quick search through the document and found 101 mentions of "Microsoft." Here are some of the particulars I noticed when looking through those references:

* Unsurprisingly, Office will be part of the new deal: "Another area of focus is our strategic alliance with Microsoft to design and market a suite of productivity applications for Nokia smartphones. During 2010, we made available Microsoft Communicator Mobile, the first application developed as part of this alliance, which gives employees direct access to corporate instant messaging through their Nokia smartphone."

* There will be a distinct division of labor with Microsoft: "Nokia would bring assets such as its brand, hardware, productization, global reach, application store, operator billing support, maps and location­-based assets to the partnership. Microsoft would bring their next generation smartphone platform with Windows Phone, as well as search, broader advertising, ecommerce, gaming and productivity assets such as Bing, AdCenter, Xbox Live and Office."

* Silverlight is the primary developer story for the coming Windows Phones, but Java's not totally going away: "For developers, we believe that we can create new and highly attractive monetization opportunities. By leveraging Microsoft’s proven developer tools and support, based on Silverlight, with our operator billing, merchandising and global application store, we intend to offer new monetization mechanisms for developers while providing access to Nokia’s global scale. We will continue to promote Qt as the sole application development framework for our Symbian smartphone platform on which we expect to sell approximately 150 million more devices in the years to come. For our Series 40­based feature phones, we will continue to support a Java-­based development environment."

* Nokia will have a new operational and reporting structure in place, as of April 1, 2011: "(W)e will have a new operational structure, which features two distinct business units in Devices & Services business: Smart Devices and Mobile Phones. They will focus on our key business areas: smartphones and mass­market mobile phones. Each unit will have profit ­and ­loss responsibility and end ­to ­end accountability for the full consumer experience, including produc development, product management and product marketing."

* Even if he wasn't a Trojan Horse, CEO Stephen Elop made out OK after leaving Microsoft for Nokia: In the filing, Nokia said that it paid Elop a salary of 280,303 euro with a bonus of 440,137 euro. Including stock options and awards, Elop made 6.66 million euro. That's the equivalent to $9.17 million. Elop was paid 2.3 million euros as a one-time payment for lost income for leaving Microsoft and another 3 million euro in October 2011 for fees he was obligated to repay Microsoft, legal expenses related to his move to Nokia and monies for medical/dental, a driver and a mobile phone.

To me, Microsoft's partnership with Nokia is a lot like the one it finally forged with Yahoo. While neither deal resulted in Microsoft purchasing another company, Microsoft is getting most, if not all, of the things it wanted from each of those partners without actually having to pay for the entire company and then integrate it into the mothership.

Topics: Microsoft, Hardware, Mobility, Nokia, Operating Systems, Smartphones, Software, Telcos, Windows

About

Mary Jo has covered the tech industry for 30 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

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  • RE: Nokia: Transition to Windows Phone to take about two years

    I'm excited to see what this means for when Microsoft integrates all platforms into one OS... Please realize that WP7 is still in its early stages, and that taking two years to convert completely to Windows Phone does not mean they'll take two years to get a WP7 device out. It means that they'll finally be all Windows Phone in 2013, right around the time that Microsoft should be dropping or majorly implementing Windows 8.
    Marine_01
    • Me too.

      @Marine_01 Other than Intel CEO and Microsoft CEO, I see very few people really meantioned Windows 8 on the phone. If you watched CES 2011 keynote, notice a thumb lengthed mother board will run Win8. Not necessarily ARM system. Just plain SoC of any kind (it was shown beside Intel system). Anyone tell me what can that be?
      jk_10
      • RE: Nokia: Transition to Windows Phone to take about two years

        @jk_10 - the whole point of SOC's is that they embed almost everything other than RAM and secondary IO bus lanes into the package - usually on the same die as the CPU.<br><br>This results in you being able to - quite literally - take a SOC, slap it on a board, interface some memory and IO physical interfaces and you have a full-blown computer.<br><br>I believe that the credit-card sized motherboard was a prototype Moorestown SOC board, but could easily have been an ARM board.<br><br><A href="http://www.ghielectronics.com/catalog/product/133">Here's an example of GHI's Fez Domino SOC prototyping board</a> with a full ARM 32-bit SOC. Practically all the componentry on the board other than the SOC is IO connectors and the necessary electrical components (power regulators, resistors, capacitors, etc).<br><br>Windows 8 on SOC's like ARM and, potentially, Moorestown is, in my view, one of the most exciting things to happen in the Windows world for several years.
        bitcrazed
    • RE: Nokia: Transition to Windows Phone to take about two years

      @Marine_01
      2 YEARS IS A LONG TIME, by then something new and cool will be out with MSFT catching up again..
      Hasam1991
      • RE: Nokia: Transition to Windows Phone to take about two years

        @Hasam1991

        By then, Microsoft will have shifted to a different strategy... rumors about Windows 8 are already indicating that. Don't be surprised if Windows 8 is the last "Desktop-only" version of Windows.
        Marine_01
      • RE: Nokia: Transition to Windows Phone to take about two years

        @Hasam1991

        Also, I would like to agree with you... two years is a long time. However, people seem to disregard that when comparing WP7's market share to the other platforms... look at Android. Two years ago, it was just getting its start.
        Marine_01
      • You have a lot of catching up to do too!

        @Hasam1991

        You haven't said an original thing since you've been here.
        Catch up, or be left behind. again.
        Will Farrell
      • RE: Nokia: Transition to Windows Phone to take about two years

        @Hasam1991 - they state that it'll take 2 years to fully transition to exclusively run WinPhone on all their devices. Nokia plan on starting to release WinPhone devices late 2011 and then begin mass device deployments in 2012.

        Considering that Nokia sells more phones world-wide than anyone else, and more than several vendors combined, the massive market share growth that WinPhone will be seeing in the next 18-24 months will completely change the phone landscape.
        bitcrazed
      • RE: Nokia: Transition to Windows Phone to take about two years

        @Hasam1991

        I agree. Two calendar years is about 20 smartphone market years. The market will charge ahead (smartphone sales increased %70 last year alone), while Nokia is working to get its act together and gets left behind.
        Eduardo_z
    • RE: Nokia: Transition to Windows Phone to take about two years

      i should say nokia is expensive for his new arrival then ,but like it also <img border="0" src="http://www.cnet.com/i/mb/emoticons/happy.gif" alt="happy">www.awwgame.com
      lariosshow
    • Windows phone loses already large market share in the USA. I can not see o

      @Marine_01
      Sultansulan
    • RE: Nokia: Transition to Windows Phone to take about two years

      @Marine_01 What this means is that Nokia is dead.
      His_Shadow
  • TWO YEARS?!?!?!?

    By then WP7 will be gone and a memory, just like the Kin.
    Brick Tamland.
    • RE: Nokia: Transition to Windows Phone to take about two years

      @Brick Tamland.
      Yes then there'll be WP8
      g@...
      • RE: Nokia: Transition to Windows Phone to take about two years

        @g@...

        Yes then there will be Android 5.0 and iOS 6.0, how the world keeps turning.
        Alan Smithie
    • RE: Nokia: Transition to Windows Phone to take about two years

      ..
      Ram U
    • RE: Nokia: Transition to Windows Phone to take about two years

      @Brick Tamland.
      I'm sure you won't let anyone forget the Kin...
      dazzlingd
    • And just like you.

      @Brick Tamland.
      Won't be long before this personal of cyberslammer will be gone, and a distant memory.
      Will Farrell
    • Windows phone loses already large market share in the USA. I can not see o

      @Brick Tamland.
      Sultansulan
  • RE: Nokia: Transition to Windows Phone to take about two years

    The partnership with Nokia is much bigger in scale than the Yahoo one. If they pull it off this could be huge for both companies; not just for Microsoft. Note that Nokia is just hanging in there in the smartphone market ,give it two years and if they don't do anything they'll crumble under android pressure.
    g@...