Translation please: Nokia and Microsoft join forces against Google and Apple for mobile dominance

Facing the grim prospect of a smartphone market controlled by Apple and Google, Nokia and Microsoft form a desperate alliance to make Windows Phone relevant again.
Written by Ed Burnette, Contributor
Nokia and Microsoft today announced they would form a "long-term strategic alliance" to challenge the Apple and Google hegemony in the mobile space. At a news conference this morning, Nokia President and CEO Stephen Elop, and Microsoft CEO Steve Ballmer laid out their new high-level strategy, complete with the usual buzzwords like "innovation" and "ecosystem". But what were they really saying?

Here are a few excerpts from the event, interspersed with my own light-hearted take on what it all means:

[Elop] The entire smartphone market is growing rapidly and we should be setting the pace.

Translation: Nokia doesn't want to be at the mercy of another company like Google in what we consider to be a critical and core part of our business.

The game has changed to a battle of devices to a war of ecosystems.

We built great hardware, but the users didn't come. We thought our software was pretty good too but if nobody uses it and develops for it, what's the point?

I am an optimist.

Hopefully we can jump off this burning platform and land on something soft. Micro-soft to be exact.

Today I'm excited to announce that Nokia and Microsft intend to enter into a strategic alliance, subject to the completion of a definitive agreement.

This is an alliance, a two-way street. It's going to go much deeper than anything we could have done with Google and Android. We won't settle on being "just another licensee".

Together we have the opportunity to disrupt the current trajectory in the battle of ecosystems. Our long-term strategic alliance will build a global ecosystem that creates opportunities beyond anything that currently exists. Together, we will deliver great mobile products.

The gloves are off. Neither one of us has been able to put a dent in the Apple/Google duopoly, but together we think we can pull it off.

Nokia will bring a tremendous brand, great mobile products, global reach, our application store, maps, and location assets to this partnerships. At the same time, Microsoft will bring a great software platform with Windows Phone, and the brands that mobile consumers want, like Bing, XBox Live, and Office.

Our companies both have strengths and weaknesses. Our strengths compliment Microsoft's weaknesses, and vice-versa. And with a few tweaks to mapping and location Bing will be great.

Nokia will adopt Windows Phone as our primary smartphone strategy.

Forget all that stuff we tried before. We're going all in. Well, almost all in. We'll keep a few "non-primary" options open in case this doesn't work out.

We will bring Windows Phone to extended price points, market segments, and geographies.

Windows Phone is currently stuck in an expensive niche. We're going to make it available cheaper, and blur the line between smartphones and dumbphones.

We believe this is good for Nokia. It gives us an opportunity to focus our investments where we can best differentiate. It gives us a faster path to the United States marketplace. And it gives us a broader opportunity to take advantage of our location based assets, including Navteq.

We spent $8 billion on Navteq so we're going to try to use it as much as we can. Want some Navteq in your Bing?

We also believe it's good for developers and publishers. They can take the skills they already have for Windows and Windows related platforms and apply those to this new ecosystem around Windows Phone. It gives them broader access to Microsoft's tools and the efficiencies that comes with those development tools.

Tools for developing for Nokia phones in the past were foreign to developers and hard to use. Now we can just tell them to use Dev Studio and .NET. Everybody loves .NET, right?

It allows developers to gain new forms of monetization, access to Nokia's worldwide store, in billing infrastructure, in short for developers that makes it easier for them to make money and it gives them access to Nokia's global scale.

Come to the dark side, we have cookies. (sorry, couldn't resist - Ed)

Steve Ballmer, Microsoft CEO too the stage after Elop. While he was obviously thrilled that MS won the battle for Nokia's heart and mind, if you listen carefully you'll see he's mindful that Microsoft has other partners on Windows Phone too.

[Ballmer] Four months ago, Windows Phones went on sale. The people who would use the Windows phones have been delighted. We've gotten fantastic reviews, great feedback from customers, and we've seen strong engagement so far from developers, with over 8,000 applications already in the marketplace.

Translation: Surprise, it doesn't suck. And a lot of people downloaded our development kits. While 8,000 apps doesn't sound like much compared to Apple's 300,000 apps, it's early days. Ignore the fact that we keep changing the platform every few years so you have to throw out all your old stuff.

We do dream bigger though: more innovation, greater global reach, and more scale. That's why we're so excited to be here today. This partnership with Nokia will accelerate, dramatically accelerate, development of a vibrant strong Windows Phone ecosystem.

When we grow up, we want to have fanbois like those Apple and Google guys. We want people to walk into an phone store in Shanghai and ask for a Windows Phone.

The fact that Nokia has a primary focus on Windows Phone *hardware*, and services, really means we can work with them in a different kind of a way to aggressively drive innovation on the Windows Phone platform.

They're not going to compete with us on the software side, which is really the only thing we care about. So we'll be free to aggressively pursue patent litigation against Windows Phone competitors.

Nokia's global expertise and focus on all price points and market segments will benefit Windows Phones broadly, and Nokia's Windows Phones specifically.

Just because we're partnering with Nokia, we're not going to leave the other Windows Phone makers out in the cold. We love you too!

The Windows Phone ecosystem should ensure more innovation in the market, more choice for consumers, and better opportunites for developers and for service providers to showcase the enhancements and improvements that they're making through their networks.

We're all about the choice and openness.

This partnership is good for Microsoft and it's good for Nokia.

Maybe this will get our stock price out of the doldrums.

No journey is completed in a single step. Over the next year you're going to see us take many steps both individually and together. We need to and we will collaborate closely on development, joint marketing initiatives, and a shared roadmap so that we can really align and drive the future evolution of the mobile phone.

It's all vaporware and press releases right now, but stay tuned. We just wanted to get the word out now to try and blunt the momentum by Apple and Google.

We're already working together to create the first Nokia Windows Phones, and we've reached out to chip vendors, mobile operators, and developers. You'll hear more from us in all of those areas over the next weeks and months.

If I had a Nokia Windows Phone in my pocket I would show you. It's going to take a while.

We need to learn along the way. We'll share what we're learning with other partners in the Windows Phone ecosystem, and as a result we all benefit.

Given our track record in smart phones, neither of us know exactly what we're doing. Hopefully we can learn enough from Nokia to make all of our Windows Phones successful.

This technology world is a lot of fun. It's crazy. It moves forward. It's propelling not only the world economy but a lot of the excitement and innovation for consumers around the world. At Microsoft we're driving many of those innovations with products like IE9, Kinect, and of course the Windows Phone. The opportunity for Microsoft to work together with Noikia to drive these ideas and innovations forward is exciting. We're pleased to be here today.

Translation: Yes, I'm a geek, and proud of it. And my company has lots of extra cash to play with so we can take the long view. If at first you don't succeed...

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