Which Fading Smartphone Company Is More Valuable To Microsoft, RIM Or Nokia?

colinneagle writes "Nokia and RIM, the two former leaders in the early smartphone market, are now basically at the end stage of their downward spirals. This is an opportunity for Microsoft, which wants to make some inroads in the smartphone market, assuming Microsoft it can play its cards right. The question is which firm is worth more. Both have their values, especially in the patent areas. In terms of just smartphones, Microsoft would probably gain more from RIM, because it could integrate BlackBerry Enterprise Server into its own server products. Nokia, though, is a much older player and probably has a lot more of a patent portfolio. The question then becomes which is an easier purchase. Nokia is a 150-year-old storied company. The Finns may not be too keen to let it go to an American firm. There is the distinct possibility Microsoft acquires both firms and keeps the best of both worlds for hardware. But where does that leave OEM partners like LG, HTC and ZTE?"

Comments

Why choose?

[bashibazouk]

Just buy both in a two for one sale!

Re:Why choose?

[KingSkippus]

That would be a really expensive gamble, but one with high potential rewards. Personally, I think you're right. A small- to medium-sized hungry player in the market would probably not think twice about taking such a gamble to make it to the big leagues, but Microsoft is so big, old, and luggish these days that it's in what I call the "protectionist" stage of business operations, which is to minimize risk in lieu of chasing huge payoffs and vastly increasing market share into a segment they're not used to playing in. I doubt they'd even consider such a thing. Too bad too, because it essentially means they will forever be pretty much irrelevant in the mobile market.

Why buy?

[mveloso]

Why buy at all? Not everyone has to be like Apple.

People think this stuff is easy - but Nokia's having issues and it's 150 years old. RIM knew its market too. Why would Microsoft be any different?

Apple makes it look easy, but it isn't. Look at the corpses strewn behind the iPhone, iPod, and iPad and you'll see some of the best companies of the era. And Apple has just started, or so they'd lie you to think.

Nokia

[CockMonster]

I worked for Nokia when the MS alliance was announced. Elop is ex-MS, he brought in some higher management from MS. The company is already drinking the MS kool-aid internally, the takeover is complete in every way except financially. Nokia shareholders would not object to getting the company out of Finland, it's expensive to hire people there and expensive to fire them. Fortunately for MS a whole lot have already been fired.

Re:Easy - RIM

[Missing.Matter]

Then again, Nokia has a strong presence around the globe. For instance, this report indicates that Windows Phone is outselling iPhone in Russia, and there were reports recently (admittedly which originated from Microsoft so obviously to be taken with a large dose of salt) that Windows Phone is outselling the iPhone in China as well.

Re:Easy - RIM

[Anonymous Coward]

This is because RIM is 'corporate' orientated, so its a natural for Microsoft. Nokia, is consumer oriented ( Apple's territory )

True but irrelevant - Microsoft would buy both for their patent portfolio, not for their technology.

Why would an additional purchase help Microsoft?

[SplashMyBandit]

The premise of the article is that by purchasing a smartphone company then Microsoft would gain assets that will help them gain traction in smartphones. This is simply not going to work and a waste of shareholder assets. Microsoft is not gaining traction with their own phone because the ideas they have that work (or worked) for them on the desktop are not desired by customers looking at mobile phones - but they treat the phone very similarly to the desktop (who wants to have Office capabilities on their phone? no-one). Despite Microsoft generating enormous profits they can't get enough new ideas out that customers want. Buying an ailing smartphone company that also does have enough new ideas is hardly going to help them get new ideas that would affect their smartphone market penetration to the tune of their investment.

IMHO Microsoft should be looking at shoring up its desktop rather than fighting Android (Linux!) and Apple on phones. That battle is pretty much lost for them. By focussing on phones Microsoft seem a bit distracted from their core area of desktop - which has allowed Windows 8 to garner very unfavourable reviews. Concentrate on what you are good at Microsoft! By obsessing over growth they are starting to lose focus, making the new desktop experience worse, and rather than maintaining their high profits they are at risk of negative growth - especially if developers decide Anrdoid desktop or OS X are worthwhile targets for their desktop products (as well as smartphone apps), since the people will also follow. Windows 8 is a muddle of ideas and less suited to the existing users than Windows 7 (hint: tablets and desktops shouldn't have the same experience, one is for content consumption and the other for content creation and their needs are different - don't lose sight of this!).

Google should buy them

[khipu]

Google needs a big patent portfolio to beat down Apple and Microsoft; they should buy both Nokia and RIM. Microsoft has done a great job depressing the Nokia stock price. And if Google buys them, they can really kick Windows 8 Phone down, given that Microsoft has bet on Nokia. Oh, and they can fire Elop too.

Re:Easy - RIM

[jo_ham]

I've always wondered, why is that you make these kinds of posts?

What does apple's market share matter to you, and why do you always rush in to praise them whenever possible?

It just seems very odd for a disinterested individual to have so many factoids at hand and such a strong desire to promote and defend a company which already has a billion-dollar advertising and PR budget.

I think it says more about you than it does me. Where do you get that I'm "praising" Apple in my post? All it offers is a potential reason for Microsoft's original statement (that the OP questioned might be a lie because Microsoft said it) to be true. My comment was neutral regarding Apple - it neither praises nor condemns.

Apple's market share doesn't bother me at all, but I thought the point of a discussion site was to have, y'know, actual discussions? Or is coming in with a point that effectively says "I don't think Microsoft is lying about Windows Phone sales in China" not allowed, or considered to be "promoting and defending" a company with a "billion-dollar advertising and PR budget" merely because I mentioned them.

If you think me pointing out that Windows Phone is "only" outselling iPhone due to some "artificial crippling" of sales due to carrier availability is some sort of "fanboy defence" then I think you're projecting your own prejudices and bias into it. I was merely pointing out possible explanations about why Microsoft was unlikely to be lying.

Either way, it says more about you than it does me. Also, you forgot to log in.

Re:Easy - RIM

[ozmanjusri]

Windows phones probably are outselling iPhones in China because the iPhone still has limited carrier selectivity.

There might be other reasons.

Original samsung i900 8GB/16GB cell phone unlocked Windows 3G 5MP
Price: US $81.00 - 101.00 / piece

http://www.aliexpress.com/product-fm/566727336-original-samsung-i900-8GB-16GB-cell-phone-unlocked-windows-3G-5MP-wholesalers.html.

In lots of 100 or more, you can get them for less than $75. Smaller resellers often package them with a reasonable version of Android pre-installed. I'm guessing they all count as a Windows phone sales.