The Smartphone Wars: Nokia shareholders revolt!

Well, that didn’t take long. Just a few hours ago I was speculating in a comment thread that Stephen Elop’s cozy deal with Microsoft Microsoft might lead to a fairly near-term shareholder revolt, and lo, it has occurred. Welcome to Plan B.

This is pretty dynamite stuff. A group of Nokia shareholders is planning an attempted coup at the May 3rd general meeting. They want to start by firing Elop and his henchmen, then reframe the Microsoft tie-up as a tactical play for the U.S. market, then put the company fully behind MeeGo as their bid for the smartphone future.

The question is, can it possibly work?

Maybe. I have to say that on first reading Plan B sounds a helluva lot more sober and credible than Elop’s jump into the arms of Redmond. Well, except for the part where they don’t tell Microsoft to pound sand, that is. The points about concentrating rather than dispersing R&D will strike most open-source programmers as an odd thing to focus on (our culture is used to cross-time-zone collaboration and does it pretty well) but as a tactic for fully concentrating on a six-month sprint to get a MeeGo handset out the door it probably makes sense.

Why do I say six months? Because I found a MeeGo dev who was willing to let me quiz him. He thinks tablet MeeGO and the infrastructure for handset MeeGO is in good shape; the work that’s left to be done is specific handset applications. When I asked him how long that would take, he considered a bit and said “6 months if it were being done entirely in house”. He fingered the open-governance process as a drag on time to market, which I’m guessing reflects the same growing plains that led the Plan B group to put centralizing R&D on their bullet list. Sounds like the project needed that fine old open-source tradition of a benevolent dictator but didn’t have one.

That six-month figure is interesting because it means my source could be low in his estimate by a factor of two without making MeeGo’s time-to-market worse than WP7′s.

Absent from Plan B is any kind of Android story. The Plan B backers seem to share Elop’s belief that Nokia would have its profit margins planed away to zero by Asian competition if it went that route. And I think they’re unwise not to simply tell Microsoft to shove WP7 up its own ass.

Still, even with these reservations, I think Plan B is more likely to maintain Nokia as a viable company than Elop’s. It has the advantage that Microsoft’s ability and willingness to hold up its end aren’t critical to the plan. There’s a string of dead companies, including in the cellphone space both Sendo and Danger, that could tell you how very huge an advantage that is.

UPDATE: Alas, the Plan B effort has folded. Institutional investors didn’t go for it.

UPDATE2: And don’t miss this artful mockery. Of the Elop deal, nor plan B. I think…

UPDATE3: Now we learn that Plan B was a hoax. You know what’s really sad? That the hoax still sounds more credible than Nokia’s actual business plan even when I know it’s a hoax.

162 thoughts on “The Smartphone Wars: Nokia shareholders revolt!

  1. —Release one or two Windows Phone devices under a Nokia sub-brand. Only if carrier acceptance, sales volumes and profit margins are satisfactory, consider releasing more WP devices and make them available in Europe. Windows Phone will not be the primary development platform for Nokia. The Nokia phones with Windows Phone operating system will simply take advantage of the existing developer tools and application ecosystem already put in place by Microsoft.—

    I’m not in this industry so I don’t the culture and so this may be an incredibly dense question:

    If they win and implement their plan how would they staff this corporate appendix that would be the MS alliance?

    I can’t see top talent being excited to be assigned there so what tier of competence would be sent to work that side? And might MS balk at having lower tier workers, seeing it as an insult to them? Not that the Plan B people would really care about that of course.

  2. Ignatius, never ascribe to malice that which can adequately be explained by stupidity. There are plenty of Microsoft fanboys in the world not employed or paid by Microsoft. Why should Elop and de Icaza be assumed guilty?

  3. >” And I think they’re unwise not to simply tell Microsoft to shove WP7 up its own ass.”

    I know almost nothing about how things work at this level. But, if MS was told that, they would probably end up buying themselves to victory against the planb guys. This way, MS can at least believe that they will still be in the game, if planb goes through.

  4. This is just bad tech management which will suck money out of the company like a black hole. There are two major problems with it:
    Trying to handle development on more than 1 platform at a time doesn’t leverage economies of scale. If you aren’t doing that, then the whole theory of the firm falls apart and you are one of several smaller companies all competing for the best office space and whiteboard marker replacements. The company that I worked for internally forked our codebase into 3 for substantially different market segments. One of these was killed off. The other two subsisted separately for about 4 years and then took nearly 2 years to squeeze back together. The resulting costs of effort duplication required was outrageous. Nokia would be left with 3 completely separate platforms (Symbian, MeeGo and W7), and at least 2 different hardware directions. This just smacks of major effort duplication.

    The next fun bit is the conversion to W7. Ignoring the natural revulsion to Microsoft, this could have some play. After all, the Windows desktop platform was the ecosystem which worked for so long. However, the closest thing that Microsoft got to a loyal following in the consumer products space was the X-box family. If it wasn’t for their track record, it wouldn’t be a bad start. The problem is that the key value-add to phones these days is in the software. To quote Joel Spolsky: If it’s a core business function — do it yourself, no matter what. By outsourcing their software development to Microsoft, they are left with hardware development. As integration continues to scale, there becomes very little electronics design to do and you are left with case design and I/O component selection. This is important, but not something which takes a large corporation to do. Everything after that is uninteresting Big Company stuff – marketing, advertising, sales, etc. This just leaves them with the shell of a technology company and a brand name. No wonder the investors aren’t happy.

  5. Maybe they are in Plan B phase….
    But they can’t just say it pubicly in event co-share with Microsoft?
    We don’t know how much billion did Microsoft gives/spend/invest with Nokia and for how long? and also Microsoft must have exclusivity from Googles’s Android. Maybe Microsoft also offer similar exclusively deals to other Manufacturer with no android on them.

    We know that Nokia’s Windows division will have a separate account from symbian and with Microsoft eye’s on it. Microsoft will basically will pay Nokia to port their apps, Maps and other technologies to WinPhone7 that is why no cross Platform development kit are allowed by Microsoft. Nokia will also get additional revenue from these sharing project.

    We know that Nokia had sell over 100 million SMartPhone and will sell that much this year. And will most likely sell 100 million Synbian base Smartphone more device next year. They have their own account/division and later will probably absorb with the much bigger Mobile Phone division which also has symbian. And yes R&D on symbian needs to be 90% centralize and let 10% be local and tactical customization. They can save ton of money without compromising ‘Nokia’

    While Symbian is old technologies but so is RIM BlackBerries which sold 45 Million unit last year. Symsian should focus on being symbian and not be an IOS, winphone7 or Android. It should focus on smaller screen, smaller processor and keypads centric technologies.

    Android suck bad on a small 2.5 inch screen and so will a full Iphone iOS. Symbian is also not processor hungry like android/win phone7.Only apples IOS is better optimize than symbian. symbian also doesn’t scale well so no need for really high end stuff save for the camera. Android/winphone7 need at least 1Ghhz Processor and 512 Mb Ram to run decently well. while IOS can run decently on 413 Mhz Processor with 128 RAM it will lose Most of it’s Multitask. But symbian will do fine with a 300Mhz processor….with the smaller screen technologies.

    It’s unlikely Nokia will Manage to sell 100 win7 phone this year or next year. Microsoft will be lucky if Nokia sells 18 Million this year and 38 Million next year. But Nokia will be able to grow in key Markets where they have zero or weak presence. Markets in US and north America for all type of phones, Market in Business/Enterprise/Corporate environment and the High end and High Mid end phones. Plus for User of Multitouch technologies.

    While Multitouch is great and is the foundation input for modern smartphone… it require a bigger screen hence a bigger phone too. winphone 7 is even have a harder to scale down on screen size due it’s tile base UI. and even the more clunkier Android with its various skin only succeed when the phone became Jumbo size to 4.3 inches . Iphone5 is reported to have a slightly bigger screen size without making the phone bigger.

    Nokia’s is actually still doing fine and unlike most phone manufacturer. It is no Kin/Danger or one trick pony Motorola. What it lack is a bit more time and Gigantic financial resources. They must develop their own OS secretly, Even Apple did not ports their IOS to ipod nano, ipod classic or ipod shufles and various other smaller hardware. what Os is up to their internal engineer n technologist to decide.

    Google apparently did not come with enough money to pay Nokia. The fact of the matter is Google needs Nokia more than Nokia needs Google and it shows. Google needs Nokia in its battle against Apple IOS and Microsoft Bing n services. Apple and Microsoft can wipe out Google with their Nuclear option and the DOJ can’t help much. The only option is to use their CIA/Mossad connection to survive but even then Google will be a shell of its former self.

    Microsoft will invest Billions in Nokia and who knows the real detail. Part of it maybe putting Bing in ALL Nokia’s Smart Phone. That alone is worth more than the Winphone7 Agreement. so even in the future if Nokia goes Meego as the primary Nokia’S OS they will still have Bing as the search engine.

  6. Why would anyone ever consider switching their mobile platform to WP7? Microsoft has been going after this market since the early days and has consistently missed the mark.

    Android looks like the most viable candidate for a mobile OS in Nokia’s position. It’s here, has large network effect benefits, and doesn’t have the MS lock-in.

    Microsoft can promise its research, its marketing budget, and a promise to make its software play nice with Nokia’s hardware, but is that enough to be the farm?

  7. Good idea. Doesn’t stand a chance unless they can trigger an institutional investor revolt.

    A 15% drop on the day of the announcement might get the attention of institutional manager.

  8. Maybe its my desire see these underdogs (and they are) win, but I hope they give Elop the boot. As for telling MS “Not just no, but HELL NO!”, there maybe some contractual arrangement already in place preventing them from doing so. As satisfying as ti would be, I think these Plan B folks have made the best of a bad situation…quarantine the disease, as it were.

  9. Google’s Lock in is actually worst!! than Microsoft at the moment. What is worst is any improvement in Nokia make in Android say for Maps or Ovi store…. It will be pirated directly by the cheap Manufacturer.

    Android have grown big because it has huge Pirated apps and content.That is why android developers don’t make money.Last thing Nokia want is cheap manufacturer copying exactly the hardware of Nokia’s and then also the OS and all of its software..The N95 has pirated version and Nokia say at around 1/5 of their hanset(dumbphone) has a pirated version. Consumer sometimes buying unknowingly.

    Unless the Phone Manufacturer takes away Android from Google and makes a phone alliance Android. Then almost all of them are doom!!! . The Chinese alliance have and will kick Google out their Androids version plus with the Chinese govt will kick Google with its infested with CIA n Mossad all over, Why should the Chinese trust Google anyway.

    Samsung and HTC probably can survive this but they all have plan B . Samsung is big enough and have huge plan with Bada Os while HTC being Chinese can also switch force and use the Chinese alliance version and use Google’s android only for america. But with Iphone already in Verizon HTC and Android will take a bit hit . So it is not really important anymore

  10. Analysts (yes I know, why trust an analyst?) think Nokia shares will go down another 20%.

    Nokia Shares Extend Fall On JPMorgan Downgrade
    http://blogs.forbes.com/parmyolson/2011/02/14/nokia-shares-extend-fall-on-jpmorgan-downgrade/

    It was bad enough that shares of Nokia dropped 10% on Friday when the company announced its new strategic partnership with Microsoft (while Microsoft’s actually ticked up a little). But today shares of the Finnish mobile giant have dropped another 5% to $8.80 in New York this morning, after analysts at JPMorgan downgraded the stock to sell from buy, and gave it a price target of $7.00.

  11. It’s not really a long shot to predict that nothing will come of this. Institutional investors are cowards, andthese guys are seeking directoriships without saying anything about their executive experience. As Keynes said, “Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.”

    Now if someone like Carl Icahn were to take an interest… But he would not be interested in working through the Plan B nine.

  12. >A 15% drop on the day of the announcement might get the attention of institutional manager.

    You speak my very thought.

  13. Their plan looks better than “we have to surrender to MS” thing from Elop. Isn’t it he who caused explosion and fire on Nokia’s platform? Now, Nokia in a real trouble with a “strategy” which will cause them to become third-rate OEM like HTC or ZTE without R&D and with only minor sales of “commodity stuff”.

  14. >Isn’t it he who caused explosion and fire on Nokia’s platform?

    To be fair, no. Nokia’s fix wasn’t Elop’s fault; it was the result of a massive, multi-year failure of leadership by the previous CEO and a lot of execs who are probably still in place.

  15. Nokia must focus on its inherent strengths, which is as a refinement innovator, not a paradigm innovator a la Steve Jobs. Microsoft will slow them down, because Microsoft is strong in neither, and Windows Phone is too far behind in a race of exponential rate of innovation. Due to the exponential function, it is too late for anyone to go back and start a new smartphone OS from scratch or even take time to complete an unfinished one, unless it will offer massive compelling advantages, which is probably unrealistic. The realistic forward innovations are precisely in Nokia’s area of strength.

    Nokia should innovate on Android so they can ship a #1 selling smartphone in 2011, and incrementally differentiate itself from the herd. It is potentially possible to co-opt Google with strategic innovations that diverge from the herd’s common base. The Android platform is inherently fractured, as this is the desirable nature of open source. The opportunity is wide-open for Nokia to provide an unfractured Android platform. Popular innovations will eventually make their way back into the common base, but always on a lag– look to Apple as a model or profitability as first-innovator.

    There is no credible AppStore or iTunes on Android on the horizon. The opportunity to take the best of Android, win the race to market, and innovate are wide open. Do not fight against the exponential function. Embrace the strengths of open source, and your own strengths with respect to it– this advice applies to everyone. Dinosaur’s stand in the way of open source. Re-inventing Android as MeeGo at this stage is an enormous waste of capital, and the free market does not reward those who do not focus capital on their relative strengths. MeeGo is yet another coffin in the European culture cementary of “politics 90% of the time, to get 10% production”. The institutional investors are correct that “American” (libertarian) culture of “Just Do It” wins, but the Elop and Microsoft selection are not even shadows of that.

  16. kk: “The only option is to use their CIA/Mossad connection to survive but even then Google will be a shell of its former self. ” – Can anyone elaborate please? I love a good conspiracy theory!

  17. Damn you for keeping my hopes alive on this pleasant Tuesday morning… ;)

  18. A group of Nokia shareholders is planning an attempted coup at the May 3rd general meeting.

    Generally speaking, the construct “attempted _____” means that someone tried to do ____ but failed. I’m not sure how one goes about “planning an attempted coup”, “planning attempted murder”, “planning attempted robbery”, etc.

    I think what this group of shareholders is planning is a (successful) coup.

  19. @Red:
    “Looks like Elop is dreaming of the rewards of being a patent troll:”

    We all know that “Winning the race” is achieved by breaking the legs of the other contestants. At least, that is how MS plays the game.

  20. It does make a certain amount of sense; the major US carriers would really love to have a platform that (unlike iOS or Android) will allow them to herd the great inattentive masses who will be moving to smartphones into a walled garden that they, rather than Apple or Google, can milk for revenue. I’m not sure that’ll actually fly, but the carriers will certainly be happy to promote WP7 as their default smartphone OS if Nokia can ship a halfway credible product. (Outside the US, of course, this is probably a non-starter?)

    Meanwhile, full speed ahead on MeeGo, because that’s the most realistic shot at a market disruption that will happen soon enough to matter.

  21. It does make a certain amount of sense; the major US carriers would really love to have a platform that (unlike iOS or Android) will allow them to herd the great inattentive masses who will be moving to smartphones into a walled garden that they, rather than Apple or Google, can milk for revenue. I’m not sure that’ll actually fly, but the carriers will certainly be happy to promote WP7 as their default smartphone OS if Nokia can ship a halfway credible product.

    I’m sure the carriers would love that, but based on walking through a Sprint store last week to get my beloved Pre repaired, Android is enough of a recognizable brand that the opportunity for herding has passed. Most people who wouldn’t recognize the Android brand are likely to ask a knowledgeable friend before purchasing a long-term item such as a phone. Apple can ride their momentum for a while (particularly with the iPad), but it looks like Android is the future of white-box OSes.

  22. The rebels want to centralize software development and recruit lots of fresh new software talent for their already too late projects. They should all buy a copy of “The Mythical Man Month”. Adding programmers to a late project makes it later.

  23. >I’m not sure that’ll actually fly, but the carriers will certainly be happy to promote WP7 as their default smartphone OS if Nokia can ship a halfway credible product

    No. You’ve forgotten some of the background that led to the Android wave. If your logic were correct, the carriers would have been pushing WinMobile for enough years that neither Apple nor Android could have gotten off the ground. From the carrier point of view, a closed-source OS owned by someone else is worse than Android, because (a) royalties jack up the carrier’s per-unit costs, and (b) control of the OS is a means to cream-skim profits the carriers think should go to them.

    The carriers are especially not going to let Microsoft own the top of the stack. They saw what happened in the PC industry and learned from it.

  24. ESR:

    I think you’re right about whether it would work, but perhaps you overestimate the carriers memory. They’re a lot more scared of Apple and Google at this point than of Microsoft – Apple won’t allow them control of the OS; Google won’t and maybe can’t; but with Microsoft/Nokia they can negotiate for a slice of that.

    As LS points out, though, this depends on people actually buying it anyway.

  25. Mike E Says:

    … with Microsoft/Nokia [carriers] can negotiate for a slice of [handset profits].

    Why would any carrier want to run a three way struggle for handset profit (carrier, hardware, software) when both iOS and Android cut this to a straight two-way profit split?

  26. Google won’t and maybe can’t; but with Microsoft/Nokia they can negotiate for a slice of that.

    They have as much control over Android as they need, which is control over the handset makers. Apple got special concessions because of the sweetheart deal they struck with AT&T. They probably got similar concessions out of Verizon, because Verizon mistakenly thought people would be lining up for iPhone Vs. Heh.

  27. Alex K:

    Because the big money is in application sales and advertising, not commodity hardware and commodity bandwidth, and Google and Apple aren’t sharing that money with the carriers at all.

    Mind, I don’t really think this will work, but if Nokia wants shelf-space in the US I don’t see a better option, assuming they actually can ship WP7 before they could Meego and that they can’t price-match on Android (although apparently Motorola can…?).

  28. > To be fair, no. Nokia’s fix wasn’t Elop’s fault;
    Sure, however, proposed cure appears to be even worse than disease itself. Do you honestly believe world needs yet another WP7 OEM and that Nokia would be able to sell all this stuff in desirable amounts? And is this anyhow looks like way to regain market share for Nokia? :) Sure, this looks like a chance for MS to recover from their failures on mobile markets. The only problem is that it does not means anything good for Nokia. It is not uncommon for MS to kill other companies even for minor and temporary profit. So now it is Nokia and they’re under attack. Then their resources will be ripped off and remaining dead body of Nokia will be dumped, as usually.

  29. > but if Nokia wants shelf-space in the US I don’t see a better option
    Bad joke! Looking on sales charts, MS seems to be a loser #1 in the world. It’s the ONLY company who DECREASED smartphones sales in 2010, regardless of WP7. Nokia has been always weak in US either. Wtf two losers will have some EPIC WIN? Are you kidding? :)

  30. >Do you honestly believe world needs yet another WP7 OEM and that Nokia would be able to sell all this stuff in desirable amounts?

    Hell, no. Read my blog, why don’tcha?

  31. esr,

    OT, but should the U.S. “shareholders” engage in a “shareholder revolt” over the Obama budget? I suppose this is an internet wish for you to write about the budget, Eric. Wishes must be written to be granted! My plan for a winning lottery ticket to blow in my car window has not born fruit yet.

    Yours,
    Tom

  32. “The only option is to use their CIA/Mossad connection to survive but even then Google will be a shell of its former self. ”

    Well it just mean that Googles with its hugh link and data analysis has both links link to CIA and Israel.Googles has a very large datacenter in Israel of all places. Googles track everything and anything. Googles eyes is everywhere. Lot of basic spywork is actually taking everyday data and seeing mood and trend of the public. Nothing fancy or James Bondy Googles is a Mossad/CIA asset and will continue so for the foreseeable future….

    Don’t believe me ask any Chinese intelligence or even the Russian one! Why does china dislike googles so much? even Microsoft gets better treatment from china. What about that google guy in Eygypt and why did he have to mention Facebook n zuckerberg so much? Has he have some intel behind?

    so if Apple will to go all out at google, google will must probably survive and not face the same fate as Netscape. but they will be a shell of a former self.

  33. should the U.S. “shareholders” engage in a “shareholder revolt” over the Obama budget?

    I don’t know how you can even call it a “budget”. It’s more like a chapter from the Wizard of Oz.

  34. “OT, but should the U.S. “shareholders” engage in a “shareholder revolt” over the Obama budget?”

    Unlike the Elop play, Obama’s budget is nothing but “voting present” and allowing political opponents to take the heat for pain.

  35. Google seems to have asked Nokia to use Android. MS was more “convincing”.

    Eric Schmidt: We Tried To Convince Nokia to Switch to Android
    http://mashable.com/2011/02/15/eric-schmidt-honeycomb-video-editing/

    As for the recent partnership of Microsoft and Nokia, Schmidt said that Google “certainly tried” to convince Nokia to make the switch to Android. It seems that Microsoft was more convincing this time around.

  36. > Google seems to have asked Nokia to use Android. MS was more “convincing”.
    Yep, mr Elop is a Microsoft’s shareholder but lacks any Nokia shares. This is so “convincing” for his own personal pocket to try to recover MS from their epic fails on mobile markets. And mr Elop haves no reasons to care what would happen to Nokia. After all, he does not haves shares. So he loses NOTHING in absolutely any case, even if Nokia will die by horrible death. Very simple and obvious. Though looks almost like sabotage for his own personal profits.

  37. Google seems to have asked Nokia to use Android. MS was more “convincing”.

    I hear Microsoft made them offer they couldn’t refuse.

  38. Googles has a very large datacenter in Israel of all places.

    That’s not that surprising.
    Google builds datacenters like eskimo’s build igloos and Israel is probably the one place they can put a data center in the middle east where the chances of being bombed over a 2-3 year timeline doesn’t approximate 100%. It seems pretty flimsy evidence for it being a CIA/Mossad sting. Is Intel in on it? They have a datacenter in Israel too and probably less reason to be there.

  39. I hear Microsoft made them offer they couldn’t refuse.

    The relative pitches to Elop :-

    Google’s : Join your uniqueness to ours and you’ll sell a crapload of phones by letting us deal with the parts you suck at.

    Microsoft’s : We will give you a crapload of money to use the OS that you’re a part owner in.

    I can see how MS’s pitch would be more persuasive.

  40. Android growth slowing? Google CEO Schmidt repeats the 300K/day number we heard awhile back. There is some nuance (which I’ve bolded) which might indicate continued growth:


    more than 300,000 Android devices are activated every day …

    It’s entirely possible the entire smartphone market is taking a post-Christmas breather. Or maybe Schmidt is just being a bit cagey — “more than” leaves an awful lot of wiggle room. Or, perhaps the market has reached some temporary equilibrium between price point, profit, and shipments, and HTC and Samsung will be able to show that Apple’s not the only company capable of turning smartphones into outrageous profits.

    In any case, as long as the market is not declining, it probably indicates that over 27M new Android devices will be activated this quarter.

  41. >Yep, mr Elop is a Microsoft’s shareholder but lacks any Nokia shares.

    That would be extremely surprising if true. In the U.S., at least, it’s normal practice to give CEOs and Board members at least a few shares (1%-3% of the company) and structure their compensation so they get a lot of options on shares. This is done precisely to give them skin in the game.

  42. >We all know that “Winning the race” is achieved by breaking the legs of the other contestants. At least, that is how MS plays the game.

    It worked for a pretty long time, but the days when MS could kill off a competitor just by making a vaporware announcement are long gone.

  43. I seem to recall someone writing many moons ago that there would come a time when choosing closed proprietary software would be grounds for action by shareholders. I know I’m badly butchering what was actually written, but I can’t seem to find the actual quote.

  44. >It worked for a pretty long time, but the days when MS could kill off a competitor just by making a vaporware announcement are long gone.

    Indeed. Google is probably activating more Android devices every week than the number of WP7 phones that actually sold through to consumers in its entire first quarter.

  45. >I seem to recall someone writing many moons ago that there would come a time when choosing closed proprietary software would be grounds for action by shareholders. I know I’m badly butchering what was actually written, but I can’t seem to find the actual quote.

    That was me, ten years ago, in The Magic Cauldron I think.

  46. A long-winded speculation of why and how the Nokia board came to take the decisions it took and how MeeGo got killed:

    http://communities-dominate.blogs.com/brands/2011/02/nokia-autopsy-on-meego-one-last-look-back-before-we-look-forward-on-the-new-nokia.html

    That seems relatively plausible to me (I’m not an insider or even in the industry), and makes me think that the owners may be prepared to take quite a hit on Nokia’s stock price before reconsidering Elop and the chosen strategy. If the writer is correct, the board considered last summer a life-and-death turning point, and I guess they knew that the stock price was going to get worse no matter what they did. Of course, the question is if it’s ever going to get better with the choice of Windows.

  47. >That’s the second time that blog has been linked to here, and I don’t find his analysis very insightful or credible. Mostly it just sounds like rationalization or apologia.

    I agree. It’s verbose, rambling, and overly speculative. To do the kind of analysis he wants to do, you have to re-ground in facts more frequently than he does before the result is even good rhetoric, let alone sound analysis.

  48. @esr:
    Finnish law seems to forbid Mr Elop from obtaining shares before major decisions (insider knowledge). Moreover, major shareowners seem to have forced the board to hire him for his MS ties. So whatever he is doing, it is what he was hired to do.

    @Patrick Maupan:
    The 300,000 Android activations Google twittered about in the the fall were a daily maximum at the time, not an average. I believe the average at the time was closer to 200k. If the average is now over 300k, that would be a 50% growth.

  49. @Mikko
    “. If the writer is correct, the board considered last summer a life-and-death turning point, and I guess they knew that the stock price was going to get worse no matter what they did. Of course, the question is if it’s ever going to get better with the choice of Windows. ”

    If this decision was indeed taken and implemented before the launch of WP7, it starts to make more sense. The epic failure of that launch was at that moment unanticipated.

    WP7 was at that moment still seen as a serious contender. If they took MS on board on that outlook, they were already sold when the failure became obvious.

    I still see a bright outlook for Nokia Mobile Phones if they fully split off. Smatt devices will simply go under.

  50. > I can’t seem to find the actual quote.

    Was it this maybe?

    Reader: What is best in life?

    esr: To crush your enemies, see them driven before you and to hear the lamentations of their channel partners.

  51. >The epic failure of that [WP7] launch was at that moment unanticipated.

    Hmmmph. They should have been reading this blog. Unanticipated, my ass.

  52. @esr
    “They should have read this blog.”

    Indeed. Cassandra was always right but never believed. MS always fail their partners, but this is never “anticipated”.

  53. >And mr Elop haves no reasons to care what would happen to Nokia.

    Whether this true or not, the common knowledge that Elop owns a huge part of MS is not going to help him win his case in the next board meeting. What worries me is how many other members of Nokia’s board have a stake in Microsoft, and how many more are going to end up having by May 3rd.

  54. I really don’t wanna talk non techie stuff….
    But unless you know how intel n counter intel works you’ll probably don’t understand it. Maybe having another language will help too.

    All telecommunication and networking in America are being monitor by Mossad and CIA, whether they do it secretly,publicly or illegally, it is what it is. It is just how America is and so is a lot of other Country too. And Yes Google is the not the more better one of them.

    Okay back to tech!

    Why did Google put enough money to Nokia to make a switch? Just offering a free but close Os is not enough? Surely Google needs Nokia more than Nokia needs Google? What more can Google offer?

    Well, the best is that Google can offer now is that Nokia can come back later if anything goes wrong… So why won’t Nokia come back later if everything else fail? Isn’t it better to Milk Microsoft’s money first?

    There is no proof that Google Android would win the smartphone race. Hell for sure they won’t win the normal handphone race. The History of the handset and phone is dominated by the various countries law, politic and carriers.

    Plus Android itself was built on shaky foundation. Google has one of the weakest patent portfolio that is why they are force to steal and go opensource. while Android may continue to live on it but becomes the Pariah OS if android becomes illegal.

    Microsoft’s Billion is a magnitude of much more sweeter than any Froyo, gingerbread, HoneyComb or Ice Cream that Google can come up with. The real truth is Nokia can still carry on and prosper with Symbian and Meego. Without ever touching Android or winphone7. They might not be the only player in town but they will still sell lots of handset and earn millions.

    It would be extremely irresponsible of Nokia to not take Microsoft’s billions! Their shareholder will not accept this, maybe even the Finland government will not approve such a decline of Microsoft offer. Nokia is having much to gain from this while Microsoft is willing to lose some money in order to invest in Bing and Winphone7. but Nokia still must be careful and play its card right.

    All in all, Nokia would only lose a bit of ‘face’ n pride with this deal but going Android is a bigger lost in face and pride!

    Maybe it is time for Google to share Search and Ad revenue with it’s Os partner.

  55. @kk man
    “All telecommunication and networking in America are being monitor by Mossad and CIA, whether they do it secretly,publicly or illegally, it is what it is. It is just how America is and so is a lot of other Country too. And Yes Google is the not the more better one of them.”

    So the CIA lets the Mossad monitor the USA, and China is afraid of Israeli spies? And Google data centers in Israel are important, but those in other parts of the world do not? Maybe you should read the last book from Umberto Eco.

    @kk man:
    “It would be extremely irresponsible of Nokia to not take Microsoft’s billions! Their shareholder will not accept this, maybe even the Finland government will not approve such a decline of Microsoft offer. Nokia is having much to gain from this while Microsoft is willing to lose some money in order to invest in Bing and Winphone7. but Nokia still must be careful and play its card right.”

    It seems you are fairly alone in your expectations. I see a loss of 20% in one week. So quite a lot of share holders expect such bad results that they are willing to take such a loss now rather than wait.

    Yahoo Nokia share prices this year (NOKIA XETRA: NOA3.DE Ticker: 900068 / ISIN: FI0009000681)
    http://uk.finance.yahoo.com/echarts?s=NOA3.DE#symbol=noa3.de;range=20101231,20110214;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=;

    @kk man:
    “he real truth is Nokia can still carry on and prosper with Symbian and Meego. Without ever touching Android or winphone7. They might not be the only player in town but they will still sell lots of handset and earn millions. ”

    Here I can only agree.

    On the other hand

  56. Mossad and CIA are actually one with the Mossad being a higher level then the bigger n fracture CIA.E everybody who is anybody in this world except for American, knows that Israel concern take precedence over than American Public. Don’t believe me get out in the real internet , avoid mainstream and study for yourself. American Foreign policy is dictated by Tel Aviv.

    Anyway back to tech….

    We’ll see how Much Nokia is committed to WinPhone7, How much the billion they will receive from Microsoft as this is all not disclose to the Public. As for dropping share price, base on hype, opensource zealot and FUD, Nokia isn’t losing any Money. No proof if the share price will not fall if Nokia adopt Google Android. Share price will still drop if they continue Symbian n Meego strategy.

    Share price is a reflection of the current and future value of the company. Nokia Share price was insanely high before and was because of it’s leadership/dominance in the innovation, marketshare, mindshare and profit revenue of its handphone market. Apple took away the leadership in both revenue and innovation. While Nokia’s marketshare and mindshare is eroded into many players.

    So unless the World return to the pre Iphone days where Nokia Dominated the world , then their share price will drop and continue to drop as those share price will reflect the current/future Nokia situation. Even if Nokia did not loose a damn penny or drop in revenue.

  57. 62 messages, and I’m surprised nobody’s trotted out this one:

    “The shareholders are revolting!”
    “You said it! They stink on ice!”

  58. @K
    Plan B is off the table.

    I see the writing, not only on the wall, but everywhere. Everybody is voting with their feet. Shareholders are dumping the stock and developers are jumping the “platform” or ship. As they have been doing for some time at MS, btw.

    http://nokiaplanb.com/2011/02/16/calling-it-quits/
    “If they do not agree with Nokia’s plans, they are better off simply divesting and putting their money in other companies that better fit their investing strategy (which is exactly what they have been doing).

    We also realized that by the time our Plan B would kick in, most remaining software talent in Nokia would have already left the company, so it would be really an uphill battle to pick up things from there.”

    Nokia’s shares now 24% down as Microsoft’s invisible takeover sinks in
    http://mobilementalism.com/2011/02/15/nokias-shares-now-24-down-as-microsofts-invisible-takeover-sinks-in/

    Looking back to a recent story on TechCrunch, there were rumours even last year of a potential takeover by Microsoft of Nokia. The two companies shared a similar pain of impending irrelevance.

    …..

    So ex-Microsoft employees are now in charge of Nokia, Microsoft and Nokia are now locked in a partnership that’s ultimately aimed at saving them both, yet no official take-over has actually happened.

  59. So ex-Microsoft employees are now in charge of Nokia, Microsoft and Nokia are now locked in a partnership that’s ultimately aimed at saving them both, yet no official take-over has actually happened.

    A good way for Microsoft to avoid an investigation by the EC, for sure.

  60. According to the Finnish industry website IT-viikko, Google opens offices in Oulu, Finland, after having acquired a couple of multimedia codec companies there. Oulu is one of the places where Nokia is laying off a large number of people. Google already has offices in Helsinki and a large data center built in an ex-paper factory in Hamina.

  61. @Mikko
    Google opens offices in Oulu, Finland

    As everyone already expected, there might be very few developers left at Nokia to port WP7 to Nokida phones. I suspect quite a number of shareholders saw that one coming too.

  62. Unless this leads to voting out the boaard… share price droping means nothing. Maybe, Microsoft , Yahoo or some Roth Bankers can buy those share cheaply and capitalize.

    I wonder if Nokia still has a plan B…
    those 150 million symbian are going nowhere except to the hand off happy customer . And I don’t see any additional 10 million sales of window Smartphone will do any harm to Nokia? Beside Meego is not ready for this year or maybe next year. Probably the earliest Meego is ready is end of next year and by then it will be still young and not mature.

  63. > As everyone already expected, there might be very few developers left at Nokia to port WP7 to Nokia phones. I suspect quite a number of shareholders saw that one coming too.

    Hmmm… as it turns out, so far Google has fired dozens of people from the companies they bought in Oulu.

  64. @Mikko
    “Hmmm… as it turns out, so far Google has fired dozens of people from the companies they bought in Oulu.”

    Maybe to make room for those they want to poach from Nokia ;-)

  65. @Jeff Read:

    Nice photoshop jobs.

    “and the OS won’t try to monetize their eyeballs by scanning their sensitive data for ad keywords.”

    You mean, Bing does not, GASP, scan data for ad keywords?

    Oh, I remember, Bing channels them to Google, and Google then scans the data.

  66. A Nokia-Canonical partnership would have been interesting. Risky and gutsy, but interesting. Shuttleworth is releasing Ubuntu 11.4 with Canonical’s own Unity desktop for better touch screen support. They want the main edition of Ubuntu to work on tablets and smartphones.
    http://arstechnica.com/open-source/news/2010/10/shuttleworth-unity-shell-will-be-default-desktop-in-ubuntu-1104.ars

    Instead, Elop hangs Microsoft Albatross around drowning Nokia’s neck. If Elop was a coyote he’d gnaw off three legs and still be caught in the trap.

  67. >Plan B was a hoax, apparently. The website now redirects to a Twitter page fessing up to it.

    You know, it’s really sad when the hoax sounds more credible than the company’s actual business plan.

  68. >Anyone care to buy a gently-soiled N900?

    Not me. Judging by your style on this blog, your notion of “gently” probably involves jackhammers, aqua regia, and high explosives.

    Not that there’s anything wrong with that.

  69. your notion of “gently” probably involves jackhammers, aqua regia, and high explosives.

    You forgot a cable with a 120V, or better yet 240V, wall plug on one end and a charging connector on the other…

  70. > A Nokia-Canonical partnership would have been interesting. [...] They want the main edition of Ubuntu to work on tablets and smartphones.

    Nokia was (is?) switching the Maemo interface to Qt, and Qt was supposed to be the target for app developers. Ubuntu’s UI would have been a bit of a mismatch, but at least they, too, are now going to be actively supporting Qt.

    I haven’t used a N900 myself, but looking at videos of it, the whole current affair just seems that much sadder. Sure, both the device and the OS were clunky next to an iPhone, but Nokia did have a working Maemo smartphone in November 2009. That was late, but the situation should still have been salvageable if they’d been throwing their full weight behind Maemo at the same time.

  71. >Sure, both the device and the OS were clunky next to an iPhone, but Nokia did have a working Maemo smartphone in November 2009.
    >That was late, but the situation should still have been salvageable if they’d been throwing their full weight behind Maemo at the same time.

    Eh. If you buy the argument that choosing anything other than Android is the losers choice, Maemo seems just as bad. All the major arguments against WP7 exist for that too, behind the curve, no apps / app store, no brand recognition etc etc. The only real difference (and to be fair, it’s a doozy) is that Maemo would at least be in house and owned by Nokia, rather than at the mercy of a third party (and Microsoft at that). It seems to me that if Apple (per the predictions here) can’t hold a strong position with their own OS and phones, then Nokia couldn’t either. Then again, I wonder if Nokia bought into the android route, how long they could hold out against Chinese knockoff competitors.

  72. There was an interesting editorial in the Wall Street Journal today. The title is “The Phone Wars Aren’t Over,” and it may be of some interest to readers of this blog. But what really caught my attention in the article was peripheral to its main point.

    “Bill Joy, the Sun Microsystems guru, spoke for many when he complained at the time [1990's] that America suffered from ‘too much competition,’ thanks to too many wireless companies promoting too many rival standards.”

    Bill Joy is a bright guy. Was he really unable to understand the difference between “too much competition” (no such thing) and “too many standards” (a completely different issue)?

    There is only room for one, or at *most* two, standards in a given problem space. But there’s room for any number of different implementation of that standard, and perfect competition should give the best results. But if half a dozen standards are floating around, then there really is no standard at all.

  73. @Cathy
    “There is only room for one, or at *most* two, standards in a given problem space. But there’s room for any number of different implementation of that standard, and perfect competition should give the best results. But if half a dozen standards are floating around, then there really is no standard at all.”

    I found the cell phone standards war very illuminating. It showed that competition is about ease of entrance to the market. NOT letting the aspiring monopolists fight it out who will get the monopoly. The European market was forced into a single standard with networks that were forced to take ANY phone (removing SIM-locks was explicitly legal from the start).

    It is telling that Nokia became market leader in the GSM market just because Nokia could not be blocked from entry and could compete against the big boys on a level playing field. And now “people” are afraid for “cheap Chinese knockoffs”? That is what a free market is for: You have to run to keep ahead.

    The hare lost from the tortoise because the hare stopped running. Nokia stopped running in the right direction very long ago.

  74. In the end, maybe we must “thank” Nokia for helping to kill WP7. Or better, blame Nokia for helping MS do it itself.

    Doomed By The Desire For Control?
    http://blogs.computerworlduk.com/simon-says/2011/02/doomed-by-the-desire-for-control/index.htm

    Extending the principles of transparency and equal access further, I believe Nokia’s newly-announced relationship with Microsoft may well have consequences they did not anticipate. They clearly think that their collective might will make the market:

    Nokia and Microsoft intend to jointly create market-leading mobile products and services designed to offer consumers, operators and developers unrivalled choice and opportunity.

    But by creating a special relationship with Microsoft, where Nokia has rights to influence the Windows Phone platform in ways others do not and are unlikely to be able to negotiate, Microsoft has ensured that other phone manufacturers will be cautious about using the same technology rather than a platform like Android where a much more open environment exists. Why would any other manufacturer want to use a platform where they play junior partner to “a broad strategic partnership”?

  75. > All the major arguments against WP7 exist for that too, behind the curve, no apps / app store, no brand recognition etc etc.

    Sure. As I said Nokia was late, and failing to accelerate the development of the software. They did have a Linux-based platform, maps, navigation, an app store (clunky and empty as it was, but fixable), and Nokia’s brand, too, which not insignificant outside of the US. A little bit later they also had Qt on the N900, so they had a good API with developer interest that worked on both Symbian and Maemo. A company with nimble software development and a good sense about the online services might have been able to pull it all off, but I guess this is pointless speculation now.

  76. MS really wants to make WP7 a preferred choice for developers, and wan to make them feel as welcome as can be. I cannot really see the full ramifications of the license language, but really, they will not put anything in your way.
    </ IRONY >

    Not that I expect to see droves of Free Software developers running to port their GPLed apps to Windows Phone. But it is nice to see that the feelings are entirely mutual.

    Microsoft: Absolutely NO (GPLv3-or-compat-licensed) Free Software for Windows Phone and Xbox Apps.
    http://jan.wildeboer.net/2011/02/microsoft-absolutely-no-free-software-for-windows-phone-and-xbox-apps/

    e. The Application must not include software, documentation, or other materials that, in whole or in part, are governed by or subject to an Excluded License, or that would otherwise cause the Application to be subject to the terms of an Excluded License.

    …..

    Now what is this ominous “Excluded License”? Scroll back in the document and find:

    “Excluded License” means any license requiring, as a condition of use, modification and/or distribution of the software subject to the license, that the software or other software combined and/or distributed with it be (i) disclosed or distributed in source code form; (ii) licensed for the purpose of making derivative works; or (iii) redistributable at no charge. Excluded Licenses include, but are not limited to the GPLv3 Licenses. For the purpose of this definition, “GPLv3 Licenses” means the GNU General Public License version 3, the GNU Affero General Public License version 3, the GNU Lesser General Public License version 3, and any equivalents to the foregoing.

    So each and all “equivalents” to the GPLv3, LGPLv3, Affero GPLv3 license are excluded. Any license that allows requires redistribution at no charge is excluded.

  77. The Finnish public broadcaster YLE interviewed Jorma Ollila yesterday. He said repeatedly that the response to the Microsoft deal from investors has been overwhelmingly positive and that the only concerns have been about the transition period. He said explicitly and repeatedly that Windows phones will be launched in 2012. In the mean time, Nokia will release new and improved Symbian products and Ollila expects the market share to stay “decent”. We’re told that the Symbian developers are “eager” to show what they can do. Believe that if you like. Ollila was asked directly about Elop being a Trojan horse, which he called nonsense with a one-word reply, and once again avoided answering the question whether he’d backed someone else. He said that the only kind of influence about the choice of CEO that he had heard were requests in the spring of last year to replace Olli-Pekka Kallasvuo, but nothing about any individual candidate.

    For all of the innumerable readers of this blog who understand Finnish, the video of the interview is at

    http://areena.yle.fi/video/1297887766588

  78. >He said repeatedly that the response to the Microsoft deal from investors has been overwhelmingly positive

    Yeah, so positive that the stock has taken a 24% hit in less than a week. Who does he think he’s kidding?

    >He said explicitly and repeatedly that Windows phones will be launched in 2012.

    Sigh…Nokia is so hosed. Nowhere in the North American market, and on present trends their global share is going to be flirting with single digits by the end of 2011. It’s like watching a slow-motion trainwreck; 2012 just isn’t going to be soon enough, not against Android’s growth rate. And they were such a well-run company once, with products that deserved the buckets of money they brought in…it’s a tragedy.

  79. >So each and all “equivalents” to the GPLv3, LGPLv3, Affero GPLv3 license are excluded. Any license that allows requires
    >redistribution at no charge is excluded.

    If I had to guess, knowing lawyers, this probably has to do with the mandate that the distributor of the software must make the source available. That is, Microsoft doesn’t want to be responsible for having to distribute the source for your app just because it’s listed in their app store. If they were really concerned about OSS licenses in general, I think they would have been more general and referenced more than the GPL softwares.

    However, it’s also interesting that they specifically highlight GPL v.3 and it’s also possible this has to do with the new anti-drm clauses in v.3 which might make it legally impossible for them to distribute if there’s any sort of auto drm to lock the app to your account a la the iOS app store.

    This shouldn’t surprise anyone as it seems that GPL v.3 is pretty much designed to discourage people from using it even more than v.2 was

  80. > You know, it’s really sad when the hoax sounds more credible than the company’s actual business plan.

    I’m really trying to decide what term of put options would make the most sense. *sigh* Eric, I need to be thinking through the stock-price implications of your analysis earlier!

  81. Esr… Nokia survive with symbian alone…

    Surely they can survive with a cross platform licenses agreement with Microsoft?

    What can Google offer to nokia? Would they willingly share search revenue? i doubt it. Google and friend will just leach every single innovation from Nokia.

    Fact is Nokia don’t need Android now!

  82. So each and all “equivalents” to the GPLv3, LGPLv3, Affero GPLv3 license are excluded. Any license that allows requires redistribution at no charge is excluded.

    Wow… thats even more self destructive than i’d usually give MS credit for. I could see a license that forced the developer to basically do a MySQL (i.e. you can give it away for free but MS can charge for it if they want to) or maybe even wording that excludes GPL “by accident” (similar to the Sun license on ZFS) but coming out and explicitly and openly excluding GPL products isn’t going to make their environment any more popular.

    Maybe we should take that as a sign that MS lawyers are starting to suggest that fighting GPL on their own turf would be a long and painful legal battle.

  83. I was wondering about how many Android phones can be expected at the end of 2011.

    The number of activations grew by 50% in some 4 months (August-November) to 300,000. That would mean a tripling of activations each year (constant growth). Ending in about a million activations a day at the end of 2011. Even if we assume only a doubling of the activations over 2011, and only take work days for activations (1.5M/week), there would be over 100M activations in 2011 alone.

    With tripling of the activations over 2011 and 6 days a week of activations (1.8M/week), there would be 170M activations over 2011.

    But this assumes the growth would remain stable. At the moment it looks more like growth rate is increasing.

    Which would mean that if things go well for Android, in 2012 NoWin phones will have to fight an installed base of 200M Android phones.

    Obviously, MS will want to win the race by breaking the legs of other runners. I expect a frontal patent assault from Nokia against Android starting this month.

  84. > expect a frontal patent assault from Nokia against Android starting this month.

    Yep.

  85. @DocDoc
    “> expect a frontal patent assault from Nokia against Android starting this month.

    Yep.”

    So, who can start a pre-emptive attack by explaining how failing companies use the law to stifle innovation and prevent consumers from obtaining the latest and greatest phones?

    “MS deny you the right to buy a Smartphone”

  86. @Michael
    “Not that it changes the analysis much, but Schmidt says it is now 350,000 per day.”

    Here is the Perl one liner I use to calculate the total number of activations starting with current activations (per week):

    $G: yearly growth (2)
    $d: activations per week (5*3.5*10**5)
    $T: total number of activations

    perl -e ‘$G=2; $d = 5*3.5*10**5;for($i=0;$i<52;++$i){$T+=$d; $d *= $G**(1/52);}; printf("%g\t%6.3f\n",$T,$d);'

    With 350,000 the yearly activation (52 weeks) would be somewhere between 130-200M. But that would be to Feb 2012.

  87. The point of my “analysis” is that if NoWin readies a phone in August, Android will have between 70 and 100 million handsets in the field with an activation rate of 2.5M handsets a week.

    To get their 30% share they must outgrow Android. But in what market? Cheap handsets? That position is taken by Android. Expensive handsets? The real cool position is already taken by Apple. And Apple is planning cheap iPhones to battle Android. Then the company market? There they would have to unseat RIM.

    So NoWin will have to fight for the center and the company types. Is that 30% of the market? And how much margin can be made there?

    Even to get a 20% market share in the first year, they would have to sell well over 100M handsets by August 2012 and really start running with 2 million handsets sold a week from the start.

    If NoWin phone sales would start at 2 million a week in August and have a sustained growth in sales of 1% a WEEK for a whole year they might be able to make the 30% market share in a year.

  88. >Which would mean that if things go well for Android, in 2012 NoWin phones will have to fight an installed base of 200M Android phones.

    I agree that 170M units is a good guess at a lower bound, and I agree that Android growth rate seems to be increasing rather than flat. I suspect it is following an O(n log n) curve – superlinear, not quite quadratic; this is a characteristic shape of diffusion-limited growth, and (not by coincidence) the value function of a scale-free network. Given that superlinear growth, an estimate of 17% over that minimum at 200M seems quite reasonable.

    Thus, Nokia has already run out of time to recover even in its best-case scenario (WP7 phones ship very early in 1Q2012). Neither party is exactly noted for meeting schedules on large development projects, and collaborations are notoriously prone to slippage. A more realistic scenario would be for WP7 phones to ship late in 2Q2012, with Android at least another 50M units ahead. Nokia WP7 phones will then be climbing a hill somewhere between 220M and 270M Android units high.

    I think it will become undeniable that Nokia has passed the point of no return sometime in 3Q2011 when that hill is already near 100M units high.

    >I expect a frontal patent assault from Nokia against Android starting this month.

    In what jurisdiction? Enforced how?

    This might be an effective tactic under U.S. IP law. But remember where Nokia is really suffering: the Middle East, Asia, Africa. It would take a successful, combined blitz over multiple jurisdictions with notoriously weak IP enforcement; not going to happen. Europe doesn’t even have software patents, and Communist China isn’t going to enforce them against the likes of Huawei or Foxcomm.

    Microsoft might be able to use patent suits to collect rent in the U.S., but that won’t solve Nokia’s problem even if Microsoft wins – which I think is unlikely in the post-Bilski environment.

  89. which I think is unlikely in the post-Bilski environment

    Uhm, I though Bilski was largely a no-op in terms of software patent litigation?

    It’s worth noting that Microsoft has a case before the Supreme Court, Microsoft v. i4i, that if they win would make it easier to take down dodgy software patents. (Full disclosure: I was involved in filing an amicus curiae brief on Microsoft’s side.) If they win, that would make a patent-strongarm strategy harder to execute.

  90. >Uhm, I though Bilski was largely a no-op in terms of software patent litigation?

    Not yet clear – but even if Bilski itself only slightly weakens the software patent system, it’s part of a general trend of courts scrutinizing IP claims for overreach more closely than they used to. If Microsoft goes to court this year it”s not going to get the kind of near-automatic deference to IP claims it might have expected in the 1990s.

  91. @esr
    I was thinking of Nokia doing general phone patent trolling. Not limited to software. However, Nokia is vulnerable to counter suits. And, generally, you are obviously right about the powerlessness of patent suits outside the US.

    But I expect them to try anyway.

  92. Microsoft might be able to use patent suits to collect rent in the U.S., but that won’t solve Nokia’s problem even if Microsoft wins – which I think is unlikely in the post-Bilski environment.

    Microsoft uses patents for FUD — the threat of a suit is much more effective than the actual suit, in some cases. “You can pay me $2M to go away, or $5M to litigate — your choice.” There are rumors that some vendors actually pay them to ship Linux.

    So, if Microsoft gave “real cash” to Nokia, you can bet they are planning on using Nokia’s patents in the US to try to extract rents. Or perhaps throw a monkey wrench or two at the ITC. The interesting thing is that, in the cellphone market, Microsoft doesn’t ship any actual hardware (never mind the small number of phones carrying MS software in any case), so has no real incentive not to act like a traditional patent troll.

    As you point out, though, that won’t really help Nokia, other than the short-term cash infusion. But maybe it was an OK deal on Nokia’s part — get some cash from MS for a market they weren’t in seriously anyway, take some of their excess developers and toss them at WP7 (with a nod to Fred Brooks), and knuckle down on something.

    Bear in mind that, while Nokia’s position looks tenuous, their failure may not be pre-ordained. There are still a lot of locations where battery life and ruggedness are more important than a retina touch screen. And there were 1.4 billion cellphones shipped last year, a number that seemingly increases every year by double-digit percentages. So 170 million Android phones is likely to be around 10% of the entire market for this year. Not chump change, but there’s room for other players.

    And if Android’s core strength really is that it doesn’t take too long to port, you can bet that Nokia will be carefully calibrating and refining its blend of phones going out the door over the next several years.

  93. Something to bear in mind –if Microsoft bought the US rights to a patent portfolio from Nokia (with Nokia licensing them back, naturally), some of those patents are probably going to be hardware patents.

    That makes trollish behavior much more dangerous. Think NTP v RIM.

  94. to be clear — not that NTP was about hardware, but that in today’s climate, NTP might be difficult, but a hardware patent analogue might be just as dangerous.

  95. >There are rumors that some vendors actually pay [Microsoft] to ship Linux.

    This I found difficult to believe. If it were true, Microsoft would find it irresistible to brag on. What better way to maintain the impression that its dominance is inescapable, so customers might as well lie back and enjoy it?

    >So 170 million Android phones is likely to be around 10% of the entire market for this year. Not chump change, but there’s room for other players.

    I think you’re reckoning without the effect of system-on-chip phones. You think you’ve seen rapid smartphone adoption? You ain’t seen nothing yet, compared to the pace of turnover when SoCs pull the retail unit cost of an Android phone with a First-World display down to $75. You think the Chinese are going to miss out on the chance to downgrade the display and sell cheap-shit Androids in unit volumes in the range of 500 million? Hell, no; this is exactly the play outfits like Huawei are positioning themselves for.

    Bet on this: most of the dumb-cellphone stock is going to evaporate like dew on a summer morning while the market analysts are still trying to get the number of the tsunami that hit them. And it’s going to happen fast, I think. Like, between 3Q2011 and the end of 2013. Anybody who hasn’t got a better cost/performance bundle to offer the Chinese when they ramp up for volume production is going to be out of the game.

  96. @Winter:

    So each and all “equivalents” to the GPLv3, LGPLv3, Affero GPLv3 license are excluded. Any license that allows requires redistribution at no charge is excluded.

    The question is, does the third paragraph of section 10 of the GPL relate to the second paragraph of that section, or to section 10 as a whole? If it relates to section 10 as a whole, then section 10 could be construed to read:

    10. Automatic Licensing of Downstream Recipients.

    Each time you convey a covered work, …

    You may not impose any further restrictions on the exercise of the rights granted or affirmed under this License. For example, you may not impose a license fee, royalty, or other charge for exercise of rights granted under this License, and you may not initiate litigation (including a cross-claim or counterclaim in a lawsuit) alleging that any patent claim is infringed by making, using, selling, offering for sale, or importing the Program or any portion of it.

    If it reads that way, then Microsoft would be out of their mind (as long as there is any value at all in software patents) to distribute unknown code under GPLv3, as would any university offering a mirroring service, especially one that affirmatively pulls code to be mirrored, rather than passively letting code be pushed onto it.

    So, for example, if MIT has a patent I want to use, maybe all I have to do is get committer rights to some relevant project, code up something which infringes the patent, get the patch accepted (never mentioning the patent, of course), and it gets distributed to all the mirrors, including MIT’s.

    I download it from MIT, and voila! I have a license to use that patent inside that program. Being the proprietary sort of guy I am, I wrap the GPL project’s code with another completely proprietary program which controls it and lets the GPLed code do the patented dirty work.

    I don’t know whether this would work or not, but I understand why companies are marketing “open source” license scrubbers.

  97. @esr:

    I agree that flashover could happen within the next couple of years. But you have to agree that if Android “only” hits 170M units this year, that means that flashover didn’t happen this year :-)

    Also, the way chip manufacturing works, if flashover is going to be happening next year, those enabling chipsets probably have to be in preproduction now.

  98. >Also, the way chip manufacturing works, if flashover is going to be happening next year, those enabling chipsets probably have to be in preproduction now.

    Agreed…and according to Nvidia, at least, they are.

  99. > Agreed…and according to Nvidia, at least, they are.

    I can well believe that. SiLabs had a single chip cellphone in, I think, 2006. But they decided that wasn’t really their business and sold to NXP. Haven’t been following, so don’t know whether they wasted this lead or have been busy updating it. In any case, most of the silicon IP is out there.

    BTW, here’s an interesting datapoint for the iPhone V fanbois:

    http://www.bgr.com/2011/02/16/exclusive-verizon-iphone-sales-fail-to-meet-expectations/

  100. If you add up the numbers in that article, after Saturday (which was the first weekend day you could buy a Verizon iPhone), the number of Verizon iPhones sold was higher than the number of AT&T iPhones sold by almost exactly the amount attributable the number of people ditching AT&T for Verizon.

    So, at least at this small sample of Apple stores, aside from the 7% of iPhones bought by the truly disgruntled who have to have an iPhone but can’t abide AT&T, AT&T and Verizon are almost in a dead heat for iPhone sales. Presumably, AT&T selling off old iPhone 3Gs for $0.00 to $50.00 has something to do with this, which indicates that, yes Virginia, there is a large price-sensitive segment of the market, and also indicates that satisfaction with AT&T’s network and customer service (at least in the area of these Apple stores!) is not so low as some pundits would have you believe — if it were truly abysmal, that’s nothing that $150 off the price of a phone would fix.

  101. >In any case, most of the silicon IP is out there.

    Yes. At this point we know of two Android SoCs – one from Nvidia, the other from Qualcomm. It’s Qualcomm saying the thing could pull unit retail price down to $75.

    I’m expecting we’ll see at least one more SoC this year, probably from Samsung or some Chinese outfit. Phones should start to ship late 2Q/early 3Q. At which point chaos will break loose in the smartphone market as everybody’s price tiering goes to hell.

  102. > At which point chaos will break loose in the smartphone market as everybody’s price tiering goes to hell.

    Let’s keep our fingers crossed that Apple helps things along by shipping an unlocked, unsubsidized phone this summer, thus forcing the carriers to upgrade their SIM-card-only infrastructure, procedures and pricing…

  103. >Let’s keep our fingers crossed that Apple helps things along by shipping an unlocked, unsubsidized phone this summer, thus forcing the carriers to upgrade their SIM-card-only infrastructure, procedures and pricing…

    Well, if they do, Jobs won’t be launching it. Word just out that he has maybe six weeks to live.

  104. It’s somewhat sad when new companies are reporting crap from the National Enquirer as truth. Of course it was and Indian/Asian news wire, so I guess they could get a pass for not knowing.

  105. > the National Enquirer

    … is demostrably a pretty good source for gossip. One media function for which people gladly pay is gossip mongering. Pray for him just in case they are right.

    Yours,
    Tom

  106. >Pray for him just in case they are right.

    And don’t place any long bets. I’m not an oncologist, but I’ve spent enough time in hospitals to know what late-phase terminal patients look like. Jobs already looked like that months ago. The man must be hanging on by dint of sheer cussedness and willpower.

    And I will say I do admire that, even though I loathe his walled-garden vision of the future.

  107. In another YLE talk program, the head of Nokia’s Markets unit Niklas Savander confirmed that the Windows devices will be launched in 2012 and that they’ve had a lot of requests from clients for an earlier date (big surprise). He said that it remains to be seen if they can pull off a Windows product launch this year. The resellers and operators would obviously like to hit the Christmas market. Savander also said that there will be a “beautiful” MeeGo device released this year.

    The panel also included the Minister of Economic Affairs Mauri Pekkarinen, a Nokia engineer and worker’s union representative Mikko Merihaara, and the secretary of the Social Democratic Party Mikael Jungner, who happens to be an ex-executive of Microsoft Finland and an ex-CEO of YLE. (Finland will hold parliamentary elections on April 17, so politicians are eager to be on TV.) Merihaara said that the workers read about Nokia’s moves from the press and that the management hasn’t informed them about the changes at all yet. Savander (who’d spent this week so far in Barcelona) said that they’ll have meetings with the staff at different sites in Finland over the next few days. There’s no word on and probably no agreement yet on how much of the Windows-based software development will be in Finland. The ‘company town’ that might be hit hardest is Oulu (pop. 142 000, at 65°01?N, current temperature -27 C), where the high tech industries employ about 16 000 people, the majority of whom are directly or indirectly dependent on Nokia. Savander said that many of them work on Nokia’s dumb phones and won’t be directly affected by the Microsoft deal.

  108. @Mikko
    “The panel also included the Minister of Economic Affairs Mauri Pekkarinen, a Nokia engineer and worker’s union representative Mikko Merihaara, and the secretary of the Social Democratic Party Mikael Jungner, who happens to be an ex-executive of Microsoft Finland and an ex-CEO of YLE.”

    This lineup shows no one believes them for a minute. If you have to argue that you do not beat your wife, you already lost.

  109. @Patrick Maupin
    “But you have to agree that if Android “only” hits 170M units this year, that means that flashover didn’t happen this year :-)”

    170M units this year is based on current prices and market development. A $75 Android would create and instant demand for 500M phones world wide. They would sell them as fast as they can churn them out. There will also be a demand for an additional 50M sub $100 tablets. Just my guesses, could be double or half for all I know.

    Current 3/4/5G phone networks cannot handle that amount of data traffic. Most of these $75 Android phones will be dumb phones with WiFi. So we would see an instant demand for (free) WiFi in malls, shops, and public buildings. I think we will see free WiFi everywhere, from public transport and toilets to restaurants and theaters.

  110. > This lineup shows no one believes them for a minute. If you have to argue that you do not beat your wife, you already lost.

    Yes, kinda. The minister and Jungner-the-ex-Microsoft-exec-turned-politician each said that the new deal “might be a great opportunity”, with a big emphasis on ‘might’. The union rep asked repeatedly why Nokia would announce that it is discontinuing Symbian and MeeGo so long before it has a Windows phone that works and is selling. Savander talked about the MeeGo and Symbian releases that were still to come and kept repeating that the Microsoft deal was made to ensure “competitiveness in the long term”. The union rep was asked about working on a product with an end-of-life date while there’s a possible pink slip looming over everyone, and he said that “of course its going to slow things down”. He said that he’d been involved in negotiations about laying off smaller numbers of people nearly 30 times over the past three years at his site in Oulu.

    The minister kept saying that Nokia hadn’t informed them yet about any numbers or locations of layoffs, and that he’d received an early warning just before Nokia went public with the announcement. The ministry has under its belt a very successful case of handling the layoff of 700+ people from Nokia and its suppliers in Jyväskylä in 2009. As I understand it, most of the people found places at other companies or new start-ups. The ministry and Nokia are hoping to repeat the effort. Jungner said that the ministry should call Microsoft and see if they’ll place a unit or two in Finland.

  111. > Current 3/4/5G phone networks cannot handle that amount of data traffic.

    I suppose that might mean business for Nokia Siemens Networks, if the operators will make the investments.

  112. >A $75 Android would create and instant demand for 500M phones world wide. They would sell
    >them as fast as they can churn them out.

    I think some of this will be heavily dependent on carriers switching up their usage plans. I can’t speak for the rest of the world, but once you reach that price in phone here in the US, the real cost concern becomes the plan. And at least here, most “smart phones” have a minimum cost of $50 – $70 / month / line from the major carriers (Sprint, AT&T and Verizon) with both AT&T and Verizon (and T-Mobile) charging you more if you have a 4G phone. So far, virgin mobile is the only one to have figured out $25 / month for unlimited web / text / 300 minutes + reasonable minute upgrades all prepaid is the way to go. It’s a shame they don’t offer GSM service or I would have switched months ago.

    Until you can decouple owning a smart phone with having to have a data plan, or the carriers get their heads on straight with regards to what their service is now, I think demand for cheap androids will be tempered by the plans.

  113. @tmoney
    “I think some of this will be heavily dependent on carriers switching up their usage plans. ”

    A flood of $75 Smartphones will most likely start as dumbphones+WiFi. You use a simple voice only plan for the the phone part, and find an open WiFi spot for Internet connections. I actually use my own Android te same way. 3G would drain the batteries while I have no point in using the data on a bus. Ioad my email or eric’s latest blog and then read it off-line (I hated it when I could not do that with an iTouch on loan).

  114. Mikko Says:
    > I suppose that might mean business for Nokia Siemens Networks, if the operators will make the investments.

    That’s a very big ‘if’. The US cellular operators seem to be completely in a “milk it dry” mode of operation, AT&T being the worst.

  115. @esr
    “I was going to just comment but I think this is worth a post of its own.”

    Yes, and the relevance for WP7 is that when NoWin will launch their first WP7 phone, it will be able to run Android. Because, by that time, every phone will be build form components designed to run Android. Just as nowadays, every computer is build from parts designed to run MS Windows.

    Not much to differentiate then anymore for WP7 phones.

  116. @Winter:

    > 170M units this year is based on current prices and market development.

    Sure, but I was just making the point that at 170K (or even at double or triple that), Nokia won’t die this year…

  117. I have “refined” my predictive model a little. I found an article that claimed there were 160,000 Android phone activations a day in July.
    http://phandroid.com/2010/07/21/the-numbers-no-one-wants-to-talk-about-in-the-android-vs-iphone-sales-battle/

    If we go from 160,000 in July to 350,000 a day (average over the week) in February, the daily activation rate grows by a factor of 3.83 per year. And activations are indeed per day averaged over a 7 day week (I did not found that clear in earlier reports).

    If I stick with a simple exponential growth curve (I have no clue how to fit eric’s O(n log n) functions), the perl one-liner becomes

    Arguments:
    1 Yearly growth factor in activations (3.83)
    2 Daily activations at start (160000 in July 2010)
    3 Number of weeks (30 for July-February)

    perl -e ‘$G=$ARGV[0]; $d = 7*$ARGV[1];for($i=0;$i<$ARGV[2];++$i){$T+=$d; $d *= $G**(1/52);};printf("Total: %g\tActivations: %g (/day)\n",$T,$d/7);' 3.83 160000 30

    Total: 5.00907e+07 Activations: 347201 (/day)

    So if you start with 160,000 per day in July, you end up with 350,000 activations per day in February (these were the fitting points, so they work). This too means that a total of 50 million Android phones have been activated since July!

    From now to 2012 is 45 weeks. At this growth rate, an additional 200 million Android phones will be activated to the end of the year. So, in Q1 2012, any NoWin phone will have to fight an installed base of 250M Android phones. A year later, Q1 2013, another 850 million Android phones will have been activated. By that time, the growth rate of Android will have been changed and we will also see saturation in the existing markets (we are talking over 1B phones to the end of 2012.

    If NoWin phones appear in Q1 2012, they will have to sell 300 MILLION(!) phones in their first year to obtain their hallowed 30% market share. That is more than double the number of Symbian phones Nokia sells in a year. I would not bet any money that they can do that.

  118. If NoWin phones appear in Q1 2012, they will have to sell 300 MILLION(!) phones in their first year to obtain their hallowed 30% market share. That is more than double the number of Symbian phones Nokia sells in a year. I would not bet any money that they can do that.

    Me neither. I’m assuming that if Nokia survives, it’s because the whole Microsoft thing is a red herring, and they hop onto Android just like everybody else. The thing is, they’ve got a lot of customers with severe constraints (battery, ruggedness), so they’ve got to carefully manage the transition. Too fast and they don’t have anything for their current customers and instead are trying to sell into the Samsung/HTC/cheap Chinese bloodbath. Too slow and Samsung/HTC/cheap Chinese will be there with low power rugged Android solutions that steal their main market. Just right and they can remain competitive and of a reasonable size for awhile.

  119. @Patrick Maupin
    “I’m assuming that if Nokia survives, it’s because the whole Microsoft thing is a red herring, and they hop onto Android just like everybody else. ”

    Exactly. That was my first thought when I heard about the split.

  120. @esr:
    > Well, if they do, Jobs won’t be launching it. Word just out that he has maybe six weeks to live.

    Obama holds Silicon Valley summit with tech tycoons
    By Perry Bacon Jr.
    Updated 10:26 p.m.
    WOODSIDE, Calif. — President Obama traveled Thursday night to northern California for an evening meeting with a group of Silicon Valley chief executives, among them Mark Zuckerberg, the founder of Facebook, and Steve Jobs, the ailing head of Apple.

    http://voices.washingtonpost.com/44/2011/02/obama-holds-silicon-valley-sum.html

  121. >A flood of $75 Smartphones will most likely start as dumbphones+WiFi. You use a simple voice only plan for
    >the the phone part, and find an open WiFi spot for Internet connections.

    I’m not saying you can’t do that. It’s how I use my iPhone since I don’t want to pay T-Mobile’s data charges. However, my point is that the carriers are selling Android phones as “smart phones” which means you have to buy a data plan when you buy the phone. This isn’t so much a problem for GSM users, as you can always buy a plain SIM card if you can get the phone cheap, but for the poor souls stuck on Verizon or Sprint, I imagine that getting them to activate an unknown device on their network would be akin to pulling teeth, which means you buy the phone from them, which means they know you have a smart phone and they mandate a data plan.

  122. To finish my thought, unless you’re expecting carriers to stop treating all androids as smart phones, I think (at least in the US) carriers are going to continue to be a damper on smart phone uptake in general, and on Android “less smart” phones.

  123. > The US cellular operators seem to be completely in a “milk it dry” mode of operation, AT&T being the worst.

    Previous analysis here indicates that cellular operators are just trying to get a reasonable return on investment. This shows a real bottleneck. Cellular operators need to be able to sell bit hauling profitably. Eric has talked about how all their other ways of taking profits are being captured by other players. We could end up in a situation like the newspapers where there isn’t a profitable business model. Then bits don’t get hauled.

    Yours,
    Tom

  124. >Previous analysis here indicates that cellular operators are just trying to get a reasonable return on investment.

    That is true, which is why I now have even less patience for standard-issue left-wing whining about corporate greed than I used to. It’s not “greed” when you’re just freaking trying to get to positive ROI; it’s basic duty to the investors who stumped up their own money so you could operate.

    >We could end up in a situation like the newspapers where there isn’t a profitable business model. Then bits don’t get hauled.

    Very unlikely. There’s so much money riding on finding a solution that one’s going to be found. At worst, Google buys up the carrier infrastructure at their going-out-of-business sales and runs it as a conduit for its eyeball-delivery business.

  125. I use a prepaid phone service in Sweden. It is from a company called Tele2. They charge me 40 cents per day I use the phone for network access. They have some cap on how much traffic I can generate, but I haven’t hit it so far.

    On another note, it is worrying that Jobs has a rare form of pancreatic cancer, since that is what killed Jeff Raskin a few years ago. Jeff was a very important person in the development of the MacIntosh. My SO, Laura Creighton, used to work for the USGS in the Bay Area and she is adamant about not drinking the tap water in Silicon Valley after having seen their analysis data. One would like to see some systematic research done one cancer incidence in the area.

  126. > Very unlikely. There’s so much money riding on finding a solution that one’s going to be found. At worst, Google buys up the carrier infrastructure at their going-out-of-business sales and runs it as a conduit for its eyeball-delivery business.

    Or we get a situation where the network doesn’t get upgraded, or doesn’t get upgraded very fast, which was the original complaint.

    Yours,
    Tom

  127. According to the Finnish news site IT-viikko, Stephen Elop has sold all of his Microsoft stock and bought 150 000 shares of Nokia stock, worth 1 M euro. Rather conveniently he first knocked 20 % off of the price…

  128. >Rather conveniently he first knocked 20 % off of the price…

    Mikko: Please stick around here after the Nokia/Microsoft furor has died down. Your combination of facts, reasoning, and humor makes the kind of regular that raises the tone of discussion here. The fact that you’re not from the U.S. and not a native English-speaker is a bonus; we could do with more of that for perspective.

  129. @esr
    “>Previous analysis here indicates that cellular operators are just trying to get a reasonable return on investment. That is true, which is why I now have even less patience for standard-issue left-wing whining about corporate greed than I used to. It’s not “greed” when you’re just freaking trying to get to positive ROI;”

    I really do not see their problem. They install towers and fiber and charge people for using them. They simply have to charge enough to make a profit. If they cannot, they should stop and start doing something else.

    I see their problems as stemming from a desire to capture their users and levy a tax on added value. I do not feel sorry for them if their tax plans fail.

  130. >I see their problems as stemming from a desire to capture their users and levy a tax on added value.

    You’re confusing four separate issues. One is whether the carriers can reasonably be condemned for greed. Another is whether their revenue-raising tactics are obnoxious. A third is whether those tactics are actually effective. A four is whether we ought to feel sorry for them.

    I find their tactics obnoxious, it’s clear from the slight negative ROI that they’re not very effective, and I don’t particularly feel sorry for them. But even given those two positions, condemning them for “greed” is unjustified and misdiagnoses the economic problem they’re tangled up in.

  131. @esr

    I agree with you and I do not even condemn greed. I see greed as a personality disorder that produces unhappyness.

    My point was that running a telephone network is simple: build bandwith and sell it. Things get only complex if you also start to retail handsets and try to extract taxes from your users. As expected, other parties will route around your toll booths. No surprises here. And as I am not in the USA I actually do not care about their future.

  132. @Winter:

    > My point was that running a telephone network is simple: build bandwith and
    > sell it.

    Yes, but… how do you think the pricing would work out if bandwidth were the only product? I’m guessing that at the moment the cost of that is subsidised by those customers that buy a new handset every year, music, ringtones and other premium services. Those of us who don’t need those things and *only* want bandwidth get it cheaper.

  133. > ’m guessing that at the moment the cost of that is subsidised by those customers that buy a new handset every year, music, ringtones and other premium services.

    I’m not sure I accept your premise as true. I think new handsets every year are a marketing cost. Ringtones and other “premium services”, maybe — but those of necessity are going the way of the dodo. If you want the ability to have/use bandwidth on what you want, then that would have to include being able to download your ringtone from whereever you want.

    You seem to view the carrier like a restaurant that makes all its real money off the iced tea. But that only works for restaurants when they disallow all outside food and drink. You say you *only* want bandwidth, but what are you going to do with it once you have it? Probably something the carrier would try to charge you for unless and until they properly get relegated to just being the lowly transporter of bits.

    You can’t have your cake and eat it too, and rather than rooting through lots of obscure plans from different carriers with different “extras” I’d like some very simple, transparent pricing on just the bits.

    BTW, if you removed all the overhead of delivering those “extras” — marketing, ringtone royalties, etc., and divided the lost profit over every customer, the carrier would probably need less than a dollar or two a month to make up the difference.

  134. @Patrick Maupin:

    Yes, you’re absolutely right that being able to make any money from “premium services” is on the way out – that process started at least five years ago, when even the dumbest of phones became able to use an MP3 file as a ringtone. But I was interested to know whether Winter has considered the effect of that, in the near future, on simple connectivity/bandwidth costs, if money from premium services disappears. (Apple has worked around that with its locked platform).

    > You seem to view the carrier like a restaurant that makes all its real money off the iced tea.

    I’d suggest a more suitable analogy would be the way that computer retail *should* work. Buy a basic box without operating system, with the option of paying extra for an OS preinstalled (this will be Windows of course) at a price on which the retailer/builder will make a profit. Most of the public will do that, so subsidising the cost of the bare box for those who intend to install their own OS.

    > BTW, if you removed all the overhead of delivering those “extras” … the carrier would probably need less than a dollar or two a month to make up the difference.

    Fair enough, but even that could make a 10% price difference on a $20/month contract. (Disclaimer: I’m not in the USA either so don’t know what a typical monthly contract price is, again that was a guess).

  135. @James M
    “But I was interested to know whether Winter has considered the effect of that, in the near future, on simple connectivity/bandwidth costs, if money from premium services disappears. (Apple has worked around that with its locked platform).”
    “Fair enough, but even that could make a 10% price difference on a $20/month contract. ”

    I am always worried when the price does not reflect the costs.

    I generally do not buy the idea that I myself am special enough to be able to game the system and come out with a better deal. A deal subsidized by the “unwashed masses” that fall for the honey trap and get fleeced. It might be so, but that is exactly what marketing would let me think. Furthermore, it would make for an unstable business plan as the “unwashed masses” eventually will find out ways to avoid the traps.

    I prefer to do business where costs and benefits are transparent. If the bandwidth cannot pay for itself, there is something wrong with offering bandwidth.

  136. microsoft is after nokia’s patent arsenal. they give a damm about phones.

  137. A train wreck at Nokia. (Ok, that’s a bad joke. One train engineer died when a freight train rear-ended another early this morning in Nokia, Finland (the name of the company derives from the original town mill there).)

  138. @Inkstain
    From the article
    “But Microsoft, with this update, has one-upped Google. Not only do we have a haphazard roll-out and inconsistent availability—we have ruined phones, too. What should have been a great strength of the platform is now a vulnerability.”

    For years now, I have seen reports of masses of developers and managers leaving from MS. This is another piece of evidence that MS have lost crucial expertice and experience. They are simply not up to standard anymore (if they ever were).

  139. Firmware should be written so that it is not possible to brick the device. To do that right, you have to have separate blocks of EEPROM that physically can’t be written to at the same time, and a small block of never-need-to-change code that can detect a particular button press at power-up, which signals it to load one of the older firmware files instead.

  140. Nokia asks users what excites them about the Microsoft deal
    The answer? Not a thing

    http://www.theinquirer.net/inquirer/news/2028794/nokia-users-excites-microsoft-deal?WT.rss_f=

    Embarrassingly for Nokia it was the ‘Other’ category that drew the lion’s share of votes with 22.6 per cent. The next most popular was the unique user interface with just over 22 per cent, while IE9 got just around nine per cent and Silverlight got a pitiful two per cent.

    ‘Other’ responses had a pretty even three-way split, which Nokia admitted was divided into three camps, none of which were particularly enamoured by the Microsoft deal. “A third agreed that Windows Phone was not what they wanted, period,” admitted the firm, continuing, “MeeGo received just over eight per cent and Symbian just under eight per cent”.

    Read more: http://www.theinquirer.net/inquirer/news/2028794/nokia-users-excites-microsoft-deal?WT.rss_f=#ixzz1F3zG9kJT
    The Inquirer – Computer hardware news and downloads. Visit the download store today.

  141. >any insights related to it that aren’t 100% in line with your previous postings on Nokia/MSFT topic.

    I’m not seeing any surprises here; it’s almost how they’d have to have done it in order to keep either set of shareholders from going into immediate revolt.

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