Chief Exec of Nokia Sees Google's Acquisition of Motorola as a Warning Sign for Android

Stephen Elop: Picking Up Operating System with 1.6% Market Share Was Wise Move

by Anton Shilov
08/17/2011 | 07:19 PM

The chief executive officer of Nokia Corp. justified the company's decision earlier this year to switch to Windows Phone 7 operating system with the acquisition of struggling Motorola Mobility. Apparently, Stephen Elop believes that Google may give preferences to Motorola once it is a part of it, which will negatively impact other makers of Google Android-based smartphones.

 

"If I happened to be someone who was an Android manufacturer or an operator, or anyone with a stake in that environment, I would be picking up my phone and calling certain executives at Google and say 'I see signs of danger ahead'," said Stephen Elop, the chief exec of Nokia at an event in Helsinki, Finland, reports Reuters news-agency.


Headquarters of Nokia

Officially, Google promised that Android will remain an open operating system, it will continue to work closely with other Android partners to develop the OS further and that Motorola will be a run as a separate business within Google (and thus will not really be an integrated part of the Android effort). Leading smartphone makers, such as HTC, LG, Samsung and Sony Ericsson welcomed the decision. It is widely believed that Google took over Motorola to get communication patents, which will help it to sign cross-licensing agreements with Apple and Microsoft, who accuse Android of patents infringements.

But the head of Nokia seems to believe that Google will try to capitalize not only on its services integrated into Android OS, but on selling of cell phones themselves. As a result, it may give preferences to Motorola (which sold 10.7 million handsets last quarter, according to Gartner) and ruin sales of other leading Android partners (who sold over 57 million mobile phones in Q2 2011).

"The very first reaction I had was very clearly the importance of the third ecosystem and the importance of the partnership that we announced on February 11, it is more clear than ever before," said Stephen Elop, implying that decision to drop Symbian and MeeGo in favour of Windows Phone 7 was indeed a wise move.

One of the things that Mr. Elop fundamentally misses is the fact that Nokia's Symbian was an eco-system ready to transform into MeeGo eco-system and become more competitive with new and more advanced phone models like N9. The development of MeeGo eco-system was supposed to be lead by Intel Corp. with its vast amount of partners as well as Nokia with its incredibly big and loyal customer base. Without Nokia, it will be hard for Intel to make MeeGo popular. But Nokia will also run into incredible problems with Windows Phone eco-system.

Based on recent findings from Gartner market research firm, the share of Microsoft Windows Phone- and Windows Mobile-based smartphones decreased to 1.6% in Q2 2011, down from 4.9% a year before. In fact, WP and WM handsets are currently behind Samsung's proprietary Bada (1.9%), RIM's Blackberry (11.7%) and Apple's iOS (18.2%) despite of the fact that they are available from numerous vendors.

Perhaps, Google Android was not the best thing to pick up for Nokia. But with 1.6% market share and dropping, Windows Phone platform seems to be among the worst choices.