Nokia announces a new partnership with Microsoft and their stock dips by 15%! Why?!

Nokia announces a new partnership with Microsoft regarding their mobile OS and announces a deep corporate restructuring, and the market welcomes that with an almost 15% dip in NOK stock! 

I just think that from an investor point of view, this kind of announcement looks like a statement of defeat on Nokia's part, as they had 1 amazing operating system 10 years ago (Symbian) which they failed to leverage in front of the Android and iOS competition and are dropping it now in the trashcan, they also started a new project backed by Intel (MeeGo) 2 or 3 years ago and it seems that they are giving it away to the Open-Source community with not much support like in the case of Android. So that might look like another potentially failed project or at least a last attempt to raise by two failures (Symbian and Windows Mobile OS have both failed to counter the rise of Google's Android and Apple's iOS) in the same manner Microsoft tried to buy Yahoo 2 years ago (cf. a quick analysis http://bit.ly/microsoft-yahoo-deal). 

On the second hand, still in an investor's point of view, if Nokia starts "dating" Microsoft, in the short term there is no upside for them, it will take at least 6months to 1 year to clear the current Nokia products' pipeline and start from fresh. Also the kind of restructuring is not a «done» deal till it is done, and carries a lot of uncertainty regarding the outcome. And finally to continue on the outcome issue, the new Windows 7 Mobile has not been in the market for long enough to see a directional trend whether it will catch Android and iOS train or if it will stay on the side like Symbian, Windows Mobile 5, or BlackBerry OS so far for that matter.

But, and there is a big but: Microsoft has deep pockets and can still spare a couple of mistakes before getting it straight, which Nokia couldn't handle anymore. Then, Microsoft Windows 7 Mobile has had a great peer reviews so far, and finally, Microsoft did the right thing by ditching all the old (and so 2000ish) Windows Mobile OS and starting from scratch in a truly definite and innovative way. It was a tough choice (always tough to do radical change and ditch the current user base, just like what Windows XP did to Windows 98), but it was a long-time overdue thing. 

I think that the timing for both of them is a little bit late (should have done it a year ago, as Android registered an 880% increase of adoption in the last year alone), but at least it finally sets the stage for new paradigm regarding Mobile OS. So far, and in the wake of 2000's Smartphone, the business model for Mobile OS was the like of Desktop OS which was to license it for each device and get royalties, or to keep it for its own devices. Apple is still doing the latter, but Android brought a complete game-changing business model, which is to give it away for free, to open-source AND to support it (the latter being the Achilles' heel of the Linux-like OS for computers). Google is making money through ads served when browsing and perhaps a cut when buying apps. 

So for Windows 7 Mobile, giving money to Nokia (which is still a huge device manufacturer) to adopt their software will benefit both companies. On the one hand Microsoft will get an instant spike in their OS distribution and adoption which will keep them relevant among the major Smartphone OS. For Nokia, it finally gives them an edge on the new Smartphone market. They are VERY strong (better than the iPhone by far) on the hardware part, but to stay head-to-head with the Samsung and HTC of this world they need to have a strong OS, which they will with this more robust Microsoft solution. Also that will let them focus on their core business, which is not software development obviously. 

Bottom line, I think on the long run this is the best strategic move they could make. In my analysis of Nokia before, I said they should focus on their core business and embrace Android. Now it's with Windows. Fair enough. The only draw-back I see with that is that it might delay further longer the adoption of a Smartphone-like OS for their "dumb-phones" that they sell by the truck-load in the developing countries, because now they might depend on Windows development pipeline for that. I still stand by my word, and do think they should deploy a scaled-down Android-like OS for their cheap phones, and not wait until the competition does it. Still, if I had money, I'd put some on NOK today at 4PM, and more in the (most probably) upcoming market pull-back.

The iPad: a little too hyped for what it is... & The JooJoo: the first full cloud computing experience...if only software/services providers follow....

Image by Getty Images via Daylife

I'm not a blogger, I don't really post all my thoughts, but I need some insights on this one, that's why I'm back from hibernation...

I'm not a big fan of the closed system of apple, but there is one thing they know how-to do is the media attention. It really amazes me when i see big names like OM Malik saying that the Ipad is going to kill anything else (Kindle, HP Slate or whatever), because that leads to self-fulfilling prophecy. And the analysts are not supposed to do that I guess, because the kinds of OM are not financial analysts, they built their fame on the analysis of gizmos etc... so their loyal fan base kinda trust them. I understand from a financial point of view that probably the Ipad is going to kill whatever is on its way, just like the iPhone did it for Nokia which still needs to give a real direction for the open-sourced (now) Symbian, but that's only because of the sex appeal (and form-design & accessories microcosm) of Apple and any "i"-stuff they bring to the market. Common guys, even the big media houses seemed so thrilled about the device, we saw it all over TV. I mean, I watch TV perhaps 20min a day, and I was able to have a glimpse of it.

For me that really leads to misinformation. Let me explain, if mainstream media wants to talk about technology and gizmos, fine. But to publish only one side is really a bias that should be. Have you heard about the slate? What does the Ipad do that really deserves that kind of attention compared to say the joojoo or the slate? Apps? Ok with more that a hundred-thousand apps already compatible (or with a minor reprogramming tweak), it's obvious that soon you will be able to buy the iKitchen accessory that will let you hang your ipad on the oven with your favorite receipt on while you are cooking, then turn it and watch the latest clip on Haïti, or on Michael Jackson while you are waiting....that's true! But still, you see the Ipad on TV and the guys there don't even say that there is any competition out there?? Wtf? Really, no other device? Really, they even quote Steve Jobs marketing b.s. (and I'm not an apple hater) by calling it a "magical (?) and revolutionary device at an unbelievable price"...waw!!! Apple does not need any advertisement fund anymore, they got it free! Don't let me start on the "magical" harry-potter-ish statement....

Everyone is talking about the 140 000 or so apps that are compatible with the Ipad. That's true and obvious. But, Joojoo might be on the verge of bringing a whole new internet experience through digging deap inside Macromedia Flash and all the cloud-hosted apps. That's funny how everyone is calling that device dead or so with no added value (well for the price I would agree, but the Ipad would probably bring the price down now that we know the market price of the "high-end" tablet). That's unfortunate that they do not have the name/money of some, and if I were Adobe, I would really support the initiative to counter HTML5's video support and Apple claim that Flash is "dead" in a a way by not supporting it for the last 3 years on its Iphone/Ipod touch. There would be a real win-win deal there: Joojoo gets the media/investors attention after Mike Arrington chocked on the deal, and Adobe would get a technology showroom for flash....and....why not think big: get their own Adobe AppStore (is there any on the web? please enlighten me)! That's the deal today, no? We saw Nokia sinking because they changed the OS Software only when the hardware changed leaving people looking for apps all over the web just to realize they were incompatible, and Ovi is really a "too-late-with-no-added-value innovation" to really bring something to the table.


So, imagine that:

1. Adobe funding and bringing the attention on the Joojoo.
2. Adobe hosting a flash app-store.
3. Finding a solution for data retention of the flash apps on the cloud (and not only the social-media services that are already doing that).
4. Having a real OS with Google-gears style local on-device data retention for all the apps.
5. Calling me a say thanks! ;)

I do believe that this is a killer/not seen yet combination of device and cloud computing (let me know if I'm wrong, I study pretty hard, so no time to stay aware about all what's going on the web2.o stuff). It could really be the first full cloud computing experience with a usable local aspect, just like you have to sync your Iphone with your computer every now and then to get, you would synchronize your Joojoo Tablet/Slate with the cloud when you are back home/at the office/at a friend's house/at a starbucks etc...

And just to finish: hey Adobe, if you don't do a bold move like that, you'll keep losing market share for you flash format toward html5 (I mean less sales of Adobe flash CS, and more of Dreamweaver CS!;) or you'll keep wooing Apple to get it adopted on Iphone/Ipad platform until perhaps one day it will. But just a hint: do you remember the floppy disk on the first i-macs, Apple never put a player on them even with all the controversy....

Well, that's only my 2 cents, what about yours?