Can Nokia revive Windows Phone?

 At a time everyone is skeptical about the non-Android-iOS platform and writing obits for BlackBerry and Nokia-Microsoft, there is a small but growing voice deep down the underbelly of the smartphone market that says Microsoft can break the Apple - Google bi-polarity. You may ask- how? It's not easy for sure- but Microsoft, given its mighty size can do this if it can synergize its capabilities and leverage on its $ 7.2 bn Nokia's mobile handset acquisition. It's as clear as day that to turn the tide in its favor, Microsoft need to quickly re-organize itself and make its road map and intent clear in the mobile business.

We all know, Microsoft despite having an early mover advantage in the mobile OS missed the mobility revolution and many blame the outgoing CEO Steve Ballmer for refusing to invent or think beyond the PC. But post the Nokia acquisition, Ballmer remarked commenting on the competencies Microsoft will acquire by saying: "Nokia brings proven capability and talent in critical areas such as hardware design and engineering, supply chain and manufacturing management, and hardware sales, marketing and distribution."

So it's better late than ever.

Need Fresh Thinking

As we look at the current global smartphone OS market share (Q2 13) going by IDC, Microsoft has about 3.7% share. Apple's share hovers around 13% while Android has the biggest slice of 79%. This shows the challenging market out there and how Microsoft can grow its market share in this backdrop?

At the fundamental level Microsoft's biggest strength and weakness is its standardization in terms of its Mobile OS versions. It does not allow too much customization by OEMs who are increasingly demanding more customization control in terms of putting their own signature UI elements. This is one of the biggest strengths of Android and hence OEMs indulge in whole lot of innovations and customizations. Often times Microsoft has defended its locked in approach, citing higher functionality and user experience through this approach as the UI is tested and standardized at its end.

Not anymore- this need to change going forward. The other area that calls for change is that OEMs need to pay a licensing fee for every Windows Phone sold in the market- this when we compare with Android devices, OEM's need not pay Google any fee but they need to by default have Google maps and search functionality on their mobile phones. Microsoft clearly needs to come out with other monetization mechanisms as this licensing approach will discourage the OEMs to launch newer windows based handsets.

Finding that elusive sweet ‘spot'

It's a difficult market out there, but still Microsoft-Nokia combo has a chance. The starting premise of such an optimism stems from the following facts:
- Technology adoption does not seem to follow a logical route. A couple of years ago none of us imagined where mobility would go. And it was unlikely that users would have bet on iOS and Android. But they did. So people preference might change as they have in the very recent past
- Microsoft's huge cash pile will give it enough marketing muscle to jump start its mobile business and leveraging on Nokia's capabilities.
- Denting into Apple-Google territory would be difficult, but that does not mean that there won't be any diversity in the mobile space and Microsoft can look at the huge market that's out of the ambit of Google and Apple and to get that market- mainly emerging ones- then it can gain big traction. Nokia already has a big market in India, though declining, Microsoft can seed it impressively. Because in places like India, Microsoft right now needs to fight only Google as Apple is way behind.
- Leveraging on its large enterprise mandates and clients. Microsoft by focusing on business centric phones- like optimized for trends like BYOD- that can be cross-sold for organizations in the Microsoft eco-system.
- Windows Phone 8 is a great OS and if Microsoft can leverage fully the manufacturing expertise of Nokia and combine with its software excellence- they will have a winner at hand if it can launch some amazing form factors.

These opportunities come with challenges. How can Microsoft overcome this?

- First off, Microsoft needs to overhaul its GTM and decision making process with singular focus on execution. For instance MS's GTM machinery needs to create a cult and aspirational value that iOS and Android have created as of now. In our opinion this gets created by the 3% to max 5% enthusiast who influence the rest of the users. In tandem Microsoft needs to up its ante on customer satisfaction as well and that would translate into customers acting as brand ambassadors. Also more region specific brand campaigns might connect well with new customers.
- Huge emphasis should be on the mobile developer eco-system and scale it on par with Google and Apple. It needs to significantly up its resources on this front
- UI rethink- is the ‘tile' interface still fashionable? Hence need to look beyond that for capturing the young audience more.
- Create a unique branding independent of its PC baggage- even today Microsoft is perceived as PC OS company ( it is- but it does whole lot of other stuff as well) and it needs to create stuff that is considered as ‘cool' by users. Apple and Android often times top the ‘cool' and ‘hot' quotient in their devices
- Regroup, reinvent and redefine - these are the three areas that will take on Microsoft's mobile play to the next level.

What do you think- Can Microsoft revive its fortunes in mobility? Can they break the Android-iOS bi-polarity? Will the Nokia buy work? Overall, how do you see the mobile ecosystem panning out? Last but not least- would you buy a Windows mobile today or go for an Android or iPhone?

Have your say!