Nokia and Microsoft Forge Partnership for Smartphone Wars

Published by: Frank Galvano on 11th Feb 2011 | View all blogs by Frank Galvano
Nokia-Logo.jpg
Nokia and Microsoft Forge Partnership for Smartphone Wars

Nokia and Microsoft announced on Friday they will join forces in order to try to compete in the fast-growing smartphone market, which is currently dominated by Apple and Google.  Shares of Nokia, the world's largest manufacturer of cell phones, fell sharply after the announcement amid investor concern about the move.  Nokia just announced Thursday that it was scrapping its previous plans to develop smartphones with its own MeeGo operating system, and will instead use Microsoft's Windows Phone OS.

“It's now a three-horse race,” said Nokia CEO Stephen Elop, who was brought in from Microsoft to revive Nokia in September.  The deal marks a possible breakthrough in the smartphone market for Microsoft, as well, as it should get Windows Phone software into 30 million sold smartphones or more every quarter, but the company's stock fell slightly due to uncertainty and the suddenness of the move.

Nokia will reportedly use Microsoft's Bing as the default search engine in its phones, which could help Microsoft immensely as it continues to try to challenge Google as the world's number one search engine.  For Nokia, the move will eventually result in thousands of layoffs around the world, and significant cuts in research and development spending.

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