Buying Nokia enables Microsoft to control both hardware and software. Now what?

Microsoft announced last night that it will buy Nokia’s devices and services business for roughly $7.2 billion, and the reaction from pundits and tech journalists hasn’t been very positive. Ben Thompson of stratechery wrote that the deal makes no sense because Redmond already had secured such a cozy relationship with the Finnish manufacturer, ZDNet opined that Microsoft is flushing away decades of Nokia goodwill, and my colleague Kevin Tofel scoffed at Microsoft’s insistence that its manufacturing partners will continue to license Windows Phone and Windows RT post-acquisition. Microsoft investors weren’t pleased about the news either, sending shares down 6 percent my mid-day Tuesday.

Michael Mace had one of the most insightful takes regarding the news with this piece questioning the value of controlling both a mobile operating system and the hardware that runs it. While Apple has executed that strategy brilliantly, no one else has been able to duplicate Cupertino’s success in recent years: BlackBerry continues to founder despite the launch of BlackBerry 10, Samsung hasn’t made much of a dent with its bada platform (although it has ridden Android to success), and Google has struggled to drain Motorola’s device pipeline to capitalize on its big acquisition. Laying claim to both the hardware and software components of a mobile ecosystem certainly provides unique opportunities, but Apple is the only player so far who has shown an ability to capitalize on those opportunities.

 

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Colin Gibbs

Colin Gibbs

Mobile Curator Gigaom Network

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