Nokia's Android X range: Will this be madness or genius for Microsoft?

Nokia's Android X range: Will this be madness or genius for Microsoft?

Summary: Through Nokia, Microsoft has just set its sights set on emerging markets and it's hoping to use Android to win new converts. Is this history repeating itself?

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First it was Symbian. Then it was MeeGo. Then it was Windows Phone. Now it's Android. When it comes to smartphone operating systems, you can't accuse Nokia of being afraid to try new things.

Today at Mobile World Congress, Nokia announced the launch of three Android devices, the X, X+ and XL.

The trio will run on the Android Open Source Project (AOSP) version of Android – that's Android with all the Google service bits stripped out to you and me – with Microsoft services in their place and a new UI that features some of Nokia's old favourites in the form of a tiles (a nod to Windows Phone) and Fastlane (a la Asha).

Why? According to Stephen Elop, Nokia's current devices head and soon-to-be Microsoft's, the X family is a gateway range – by giving users in emerging markets a bit of Android with a little Microsoft thrown in, the company is hoping those users will graduate up to Windows Phone later on down the line when they're properly hooked on smartphones.

Looking at the decision to launch the X range, it's not immediately apparent if the move is madness or genius.

Nokia's (and therefore shortly Microsoft's) traditional emerging markets lines have been struggling of late: while Nokia's non-smartphones are still selling in their tens of millions, sales have been starting to drop in the face of competition from sub-$100 Android devices.

The importance of apps

It looks like Nokia decided it couldn't beat them, so it might as well join them. According to Elop, launching devices on Android meant Nokia could take advantage of app ecosystem already build up around the OS.

But instead of taking Google's Android wholesale, Nokia has gone for its own forked version with lots of Microsoft elements on top.

As it's using AOSP rather than the Google Mobile Services version of Android, the X range won't feature any of the traditional Google services normally found on Android either — no Play, no Google Maps, no integrated Google search and so on.

That's both a blessing and a curse for the X range: the phones won't come with some of the elements that make Android so compelling, but it also gives Nokia and Microsoft a chance to replace them with its own equivalents, or those of its partners: there's Bing search integrated into Nokia's Xpress browser, OneDrive and Skype. There's Nokia's Here supplying the maps, for example, and there's Yandex to replace Play.

Nokia has also already got some of its own apps ready to download for the X range — think Facebook, Spotify, Skype — and they'll be linked to from the Nokia store that comes on the X devices.

Those are sensible ways to address the app question that will inexorably dog the range, but the broader question around developer support remains. While Elop promised Android developers could port their existing apps to the X range "in a matter of hours", I can't imagine too many will take him up on the offer of doing so for the sake of three phones with unknown numbers of users. After all, not too many have done so for Windows Phone, which has millions of users worldwide, and that lack of app ecosystem is still hampering the OS to this day.

The fight for growth markets

There's no question targeting emerging markets is a sensible strategy for Nokia-Microsoft, and taking on the cheap Android makers is absolutely a sound plan. But whether the X is the way to do that is unclear.

For users in emerging markets moving from a feature phone to their first smartphone, does OS really figure in the buying decision? Price and user experience are likely to be more important factors for choosing one handset over a competitor's.

According to Elop, the X range will serve as a way of introducing new users to Microsoft software before moving them up the stack onto Windows Phone devices, the company's real focus.

In releasing the X range, Nokia (and so Microsoft) may have got itself in a double bind: if the user experience with the X is good enough and the price is right, what impetus does the user have to migrate to Windows Phone? If on the other hand it's not ideal, why would that user want another product from that company?

To persuade users to gradually make the transition from Nokia feature phone devices to handsets running Windows Phone, Microsoft will bring out cheaper and cheaper Lumias, and sell the already rather reasonable X family — costing from €89 to €109 — at cheaper price points still.  

That means the price differential between the most expensive X and the cheapest Lumia isn't huge, nor is the gap between the cheapest X and the most expensive Asha. With common UI elements and apps across all the OSes, and no huge leaps in price from one to the other, it's hard to see what tools Microsoft will have at its disposal to persuade users to move from one OS to the other in future, once the Nokia acquisition is complete.

The X strategy feels a little like Nokia going back to the future: in adopting Windows Phone, it threw its own OS under the bus, hoping to make money and build loyalty putting its own software on top of someone else's operating system. Which, I can't help but think, does have parallels with what it is doing here.

And if the X range takes off, that gives Microsoft four OSes to support once the acquisition closes — Windows Phone, AOSP, Series 40 and its Asha OS offspring. Wasn't a profusion of OSes one of the reasons Nokia cited for adopting Windows Phone in the first place – having flirted with Symbian, MeeGo, Meltemi and Series 40 to address all price points, didn't Nokia find the we'll-be-all-OSes-to-all people idea unworkable?

Think back to the N9: Nokia's first and only device running MeeGo, the N9 was killed off to allow Nokia to focus on more established OSes rather than work to build support for a new, alternative operating system.

While it's tempting to see the X as the tail-end of Nokia as independent company, it makes far more sense to see it as the first steps for Microsoft as a device maker. As such, I wonder if the same fate awaits the X range. Many industry watchers say under Microsoft's aegis, the X range will be killed off. It's not that simple, however, as ZDNet's Mary Jo Foley points out: Microsoft may well decide to keep the X device line going, meaning the problems with the range aren't simply going to go away overnight.

I can't help but think Microsoft has the tools to be successful in emerging markets already at its disposal and may not need X going forward. If Asha, Windows Phone and ASOP X devices are getting closer in price, why not go all out on Windows Phone, take a hit on the price per licence in favour of locking users into the ecosystem for the long term?

Every time Microsoft asks users to make a move from one of its OSes to another, it gives a user pause to think whether to go for a new OS on Microsoft, or on someone else's platform. If it got on them on Windows Phone at the earliest opportunity, their upgrade path would be simpler, and there would be far fewer chances for them to leave for a rival's offerings.

Then, with Nokia's historical device-manufacturing expertise, it could use hardware elements as the means of getting users to trade up for more expensive devices. Hardware has been sorely lacking in innovation for some time now, meaning the time is ripe for it to be used as a differentiator once again. Take the 1020, for example: it generated a fair amount of buzz due to its market-beating camera. If anyone can make hardware interesting, it should be Nokia.

Mobile is hugely important to Microsoft and will only be more so in the future. Getting its OS strategy right is no small part of remaining relevant in a market that Google and Apple have claimed for themselves. If it continues to hedge its bets with the X range, Microsoft won't have learned the lessons that Nokia was forced to some years ago. And we all know how that worked out.

More on Nokia and Android

Correction: This article stated Stephen Elop is the current head of Microsoft's devices head. He will assume this role role once the acquisition of Nokia's devices unit closes later this quarter.

Topics: Mobility, Android, Hardware, Microsoft, Mobile OS, MWC, Nokia, Smartphones

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40 comments
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  • Worth a try...

    I suppose it's worth a try, but like the article suggests... it'd probably make more sense to try to fit a stripped down version of Windows Phone on to these low-low-low-end devices... instead of Android.
    cybersaurusrex
    • Most likely, it won't run. Even if it does...

      There is still (for the moment) the license issue.

      If the license cost is 0 as it is for Android, then the price would have to be the same...

      But that means the prices charged to their "partners" would also have to be the same...

      Since that isn't the situation, Microsoft would just be stabbing their partners in the back again.

      The end result will be fewer Windows based phone vendors.
      jessepollard
      • The Windows Phone culture problem

        Android isn't free. It comes with patent fees.

        What MS faces is a culture war, where many younger folks think Android and iOS are cool, and these are the folks that sell smartphones in stores. MS is now facing the same situation Apple faced many years ago, when retail salespeople had no love or respect for Apple products. Apple overcame this with its own network of retail stores, and MS has little to choice but to do the same today. Nokia should have used the money it invested in these X phones, and established stores and stores and pop up stores in places it was having difficulty selling its Lumia phones - e.g. the US and China. These phones seem like a waste of money to me.
        P. Douglas
        • Coolness

          IOS is so not cool. Your parents think its cool.
          dalgarven
          • Cool

            Judging by the sales, LOTS of people (200,000,000+) and growing. If the iOS isn't cool, the sales sure ARE, if you are a company exec, or a stockholder.
            rphunter42
        • Microsoft paying itself...

          One of the big recipients of those patent fees is Microsoft. Microsoft likely also has cross-licensing deals in place with some of the other Android patent holders, so those costs are also off the table.
          markaaa3
        • the patent fee is a trick from Microsoft.

          the one time it looked like the claims were going to end up in court... the barns and noble case.. Microsoft folded and ended up making a deal where they paid B and N 300+ million from memory.

          if the patents were for real... Microsoft would have gone after Google... but Google don't sell windows licenses and won't give up .. so Microsoft has no leverage and would likely lose a heap of the parents in court to Google and then they'd not be able to use them to bully money from weaker companies. Samsung sells windows computers. it relies on Microsoft for one of its divisions.. if the a$$ falls out of Samsung's PC division you cab expect then to get a whole lot more beligerent about paying the Microsoft android tax.
          frankieh
        • The iPod is what saved Apple...

          If it weren't for the iPod, we wouldn't be looking at Apples right now. For years (decades I should point out) there were only a niche few which that usually works with the Mac G series where they are employed. For Apple, the iPod was the ONLY way to break into the MS market because it doesn't require a proprietary of Apple devices to operate. Then with the release of the iPhone, that's when Apple really took off. The reality is, Apple (is still) not known for its computers but for its iPod and iPhone, and for revitalizing an old 'tablet' known as the iPad. Now the general public has viewed Apple products as cool and innovative. So if Apple one day decides to release its new futuristic iToilet Tissue, it will sell by the trillions!
          80sGuy
    • WP runs on a slow dualcore...

      Android needs a (for example) quad 1.4 GHz exynos cpu, 16 G main mem and at least a gig or RAM (yeah, that's my S3, first Android phone I could use also as a phone and not a toy) to react in an acceptably responsive way.
      I tried a lot of these things, emerging markets or not, who's going to wait minutes while everything crashes, and in the end, you just take the battery out and reboot that $100 phone.
      WP, and previously Symbian needed far less in terms of hardware.
      You can still buy a S3, and it's dirt cheap, it will get KiKat soon, so why bother?
      burned out guy
    • lol

      they cant call it android as that is a Google trademark, they are making it look like windows phone it won't have the traditional android apps... how are folks in low income areas gonna know it isn't just another windows phone variant in the first place?

      additionally microsoft are doing exactly what Google refused to do.. making really cheap hardware that competes with their partners.. the irony is that Microsoft will be doing it using an OS that it doesn't want its partners to use. Google refused to make the nexus devices itself.. it outsourced then to its android partners... EXCEPT for the one it owned.. it made that one stand on its own and get less special treatment than the likes of LG or Samsung.
      frankieh
  • If it looks enough like windows phone...

    ... then its not going to matter to the customer if it ISNT windows phone. Whatever custom stuff they put in this version of android will make it windows phone lite, which to me seems to be just begging for an upgrade.

    This looks a lot like 'You can get windows RT orrrrrrrr you can get the real thing!', and with the price difference between the X and Lumia said to be so small, I can see the X line selling people on windows phone just by making them think 'its only a few dollars more for a REAL smartphone'

    Is that true, or even fair to think? Maybe not, but it could work
    luke mayson
  • Nokia's Android X range: Will this be madness or genius for Microsoft?

    They would have been better off just using Microsoft Windows Phone instead of a stripped android with Microsoft services. This could tarnish Microsoft's reputation for putting out quality software when the user tries to run android apps and it freezes up on the or when the phone suddenly reboots itself. A complete Microsoft Windows Phone solution would have been the better choice.
    Loverock.Davidson
    • likely won't run on the platform.

      And trying to put something big enough to run WP8 on it would have made it too expensive.
      jessepollard
    • MS reputation

      Microoft has no reputation to defend in the mobile space.
      cropr
      • Microsoft has no reputation...

        Would be good enough. It's floundering in the security of it's software systems for decades on end should be enough reason to just let them crash and burn. There is no product management and no product development at Microsoft that has contributed in any positive way to actually enhance the value of their products, overall. Yes, they've "used" state of the art developed in lots of other places for their enterprise systems, sometimes. But, overall they've done nothing which actually improves and adds value to the computer science scene, ever...
        greggwon
        • Thats a bit harsh..

          I pointed out the non existence of Microsoft's genuine innovations in the history of the computing industry. I was roundly corrected by ToddBottom, who's top example was that they had been one of a group of six companies that were early-adopters of the USB...
          e9csl
    • As for reboots...

      The same thing would happen to WP8...

      But I really haven't read of that many reboots without a hardware failure. Not since Android 1...
      jessepollard
  • Sony's first VHS VCR was also a bummer...

    But in the end, they learn the lesson that in a format war, the sooner you concede defeat that sooner you can reap it's benefits.

    Take Toshiba with HD DVD. You no longer see them anywhere and Toshiba Blu Ray drives are better than ever.

    Even Sony got another chance for greatness once Video8 and Hi8 appeared in the market. It's ironic that VHS didn't make it to the digital era, with D-VHS mostly ignored by the market. But Video8 did with Digital8 which later was "replaced" by miniDV which was just a respin of DAT, another dead format.
    cosuna
  • Amazon did the same thing

    You guys do realize that this is the same path that Amazon took to make the OS for the Kindle Fire right?

    This phone still runs android and you can still use .APK files to install apps to it
    Shane Hudson
    • except that

      Those are high end devices with a low price, and lots of good apps Available, and it is not that hard to install the apps from the play store.
      bluescreen_z