Microsoft's Strategic Alliance with Nokia

Microsoft's Strategic Alliance with Nokia
Case Code: BSTR406
Case Length: 14 Pages
Period: 2011-2012
Pub Date: 2012
Teaching Note: Not Available
Price: Rs.500
Organization: Microsoft Corporation, Nokia Corporation
Industry: Smartphones
Countries: Global
Themes: Strategic Alliance, Competition
Microsoft's Strategic Alliance with Nokia
Abstract Case Intro 1 Case Intro 2 Excerpts

Joining Forces in the Smartphone Wars

In September 2011, Microsoft Corp. (Microsoft), the US-based computing industry major, and Nokia Corp. (Nokia), the Finland-based communication company, launched a toolkit that would allow developers to port Symbian operating system (OS) applications to the Windows Phone OS.

The package was expected to help Symbian developers learn to develop Windows Phone. "This helpful package contains the tools and documentation to help you along the path to learning Windows Phone development," said Jean-Christophe Cimetiere, senior technical evangelist, Microsoft.

Earlier in February 2011, Microsoft had entered into a strategic alliance with Nokia. The alliance envisaged combining the traditional strengths of the two companies to create synergies. In the face of stiff competition from Google's Android and Apple's iOS, Microsoft's share in the mobile OS market had been shrinking. And Nokia was struggling to compete with Samsung Electronics (Samsung), Apple, and HTC Corp. in the smartphone market as most buyers perceived its Symbian OS as being outdated and lacking in many of the features that were available in competing operating systems. The strategic alliance was expected to help the two companies build a new mobile eco-system. Nokia was to gradually migrate away from the Symbian OS to Windows Phone. It was hoped that Nokia Windows Phones would offer a compelling alternative to prospective smartphone customers.

With Google, Inc. purchasing Motorola Mobility in August 2011, the smartphone market seemed to be in the middle of a profound change. Barring Microsoft, all major OS vendors now had a presence in the smartphone hardware market. According to some analysts, this could be disadvantageous for Microsoft. As Nokia had a negligible presence in the US, the world's largest smartphone market, industry observers felt that it would be an uphill task for Microsoft and the alliance to make headway there. Also, with Google and Apple succeeding in creating a thriving ecosystem of apps, it was felt that it would be extremely difficult for a third entity to challenge their hegemony..

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