adoption

Nokia has made moves to gain some big titles (and leverage) for their hardware. Who does it hurt? Who does it benefit and is it a good thing?

With yesterday’s announcement from Nokia describing a planned set of “exclusive” apps and even more games for their Lumia line of Windows Phones (and presumably anything else they have up their sleeve), Nokia has won both praise and some scorn for their bold move.

The concern, as echoed by some in the tech press, is that Nokia’s move will cause that dreaded “F word” to happen. No, no that one, the other one – fragmentation.

Fragmentation is the boogey word of the year due almost entirely to Google and their Android OS. But as ex-Microsoftie Charlie Kindel astutely pointed out, there isn’t just one type of fragmentation.  Rather, there’s at least six ways you can divide up the terms with some of it being positive and some of it negative, affecting consumers or developers. Point is, they're not the same and what is causing problems for Android is not the same as what Nokia is doing.

The real question is, will Nokia’s strategy to get these apps and games on their hardware hurt Windows Phone?  We say “no” and here’s why.

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Nearly 60% of those switching to Windows Phone due to the Nokia Lumia 900 or HTC Titan II were former iOS and Android owners. Apple brand-loyalty? We think not.

We ran a poll the other day asking users if they switched to Windows Phone due to the Lumia 900 or Titan II, what OS were they coming from. And although the poll is still technically open, with 3,462 votes tallied so far we can discern a distinct pattern forming from the results.

The majority of users, nearly 60%, are coming from a combo of former Android and iPhone owners with it neatly divided at a close 30% each. Blackberry users are evidently still holding on with just 10% and a nice healthy 14% of adopters were coming from non-smartphones.

While our pals at Crackberry spun it as hope for Blackberry 10 users, we imagine a lot of folks jumped that ship last quarter to either the iPhone or Android, leaving the diehards (or still contract-bound) behind. Personally, we think RIM is DOA and look forward to a Microsoft acquisition at a rock bottom price (insert maniacal laughter).

The Android/iPhone results are interesting only because we're seeing what looks to be equal amount of folks taking up Windows Phone, leaving in the dust the notion that Apple has stronger brand loyalty than any other company.

One could also interpret the results as the Lumia 900 piquing interest from all segments of the smartphone market, represented in a roughly proportional manner. That's good news for Windows Phone as an OS and better news for Nokia who seem more than capable of garnering media attention on a wide scale. That is something the likes of Samsung and HTC have not been able to do in part because of their divided interest between Android and Windows Phone.

With the Lumia 900 seemingly selling very well (and yes, it's still number #1 and #3 on Amazon Wireless) the question now is will it maintain that momentum over the coming weeks?

We think with the glossy-white 900 set for this Sunday, April 22nd it will certainly create even more interest and those rumors of a magenta version for Mother's Day could also do wonders for the brand. We'll revisit this issue next month.

Update: To clarify, we purposefully left off previous Windows Phone users. The reason is because we were interested in only those who switched their OS due to the allure of the Lumia 900 (or Titan II). While we're sure a chunk of you were Windows Phone/Windows Mobile users, we wanted to look at the ratio of those who converted.

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It was just six days ago when we reported that Mango hit 20% of Windows Phones world-wide (17% in the US). The info came via the free app "...I'm a WP7!" which collected the data from its 83,000 users.

As of today, the number has hit 30% world-wide with Windows Phone owners in the U.S. following closely at 27%. The data sample this time is also much larger, with over 93,000 users now on board using "...I"m a WP7!", making it even more reliable and statistically significant.  At the current rate, Windows Phone Mango should hit a 50% adoption rate by October 22nd, less than 30 days after the update went "live" for a limited amount of users. Not bad, not bad at all for Microsoft's big-update.

One thing that is for certain, it will be interesting to see if Microsoft can deploy such a large update to scale once Windows Phone gains more market share. So long as the number of different Windows Phone devices stays relatively small (compared to Android), we think it shouldn't be a problem.

Pick up a "...I'm a WP7!" here in the Marketplace to see for yourself, as well as other interesting user stats.. (Thanks, Judge Daniel & TheWeeBear for the tip)

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While Microsoft and their platform are slowly expanding grounds, Nokia is continuing to travel down a negative path with sales plummeting and revenue decreasing. Compared to the glory days when the company’s brand was used to describe mobile phones as much as the term mobile, at present a radical change is required for them to continue within this competitive market. Analysts know this, consumers know this, and more importantly so does Nokia.

Along with countless reports and articles covering a potential join of the hands between Nokia and Microsoft, an investment analyst, who has sent a memo to the CEO of both companies urging them to work together and create Windows Phone 7 handsets, has provided a huge push in a positive direction.

The analyst, Adnaan Ahmad of Berenberg Bank, doesn’t hold back in his note with covering WP7’s (and – to an extent - Nokia’s) competitors and pointing out that he knows both Steve Ballmer and Stephen Elop must be “both sick and tired of hearing how great and innovative Apple and Android (Google) ecosystems are”. Moving onto say that “they have hundreds of thousands of applications, growing revenue at 50%+ per annum and gaining market share globally,” and he is absolutely correct in his referencing – but Microsoft already know this, they are in it for the long haul.

Directing at Nokia, Adnaan continues, “I remember the days when Nokia (with Jorma Olilla at the helm) ruled the roost, European market share was above 50% and US market share was in the 35% range.” While quoting what Stephen said in his recent Q4 earnings release, “Nokia faces some significant challenges in our competitiveness and our execution. In short, the industry changed, and now it’s time for Nokia to change faster,” he agrees that now is the right time for Nokia to change (perhaps from Symbian altogether?) and with WP7 readily available in it’s infant stage, now could prove to be the only time for action.

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The world is aflutter today (and journalism has taken a back seat) with the unsubstantiated rumor that Nokia, under leadership of Nokia CEO Stephen Elop, who used to work with Microsoft, is in secret talks to work with Microsoft on releasing some Windows Phones. The rumor comes from Eldar Murtazin, who has attained near celebrity status with his rumor posts, despite the mediocre track record. In a post he writes (translated):

In the last month behind closed doors is a discussion of expanded cooperation Nokia and Microsoft (two-way discussion, initiated by the new leadership of Nokia). Not simply the exchange of technology, but creating an entire line of Windows Phone devices that may go under the name Nokia, through the sales channels for the company, and will also have the characteristic features of its products. This is a desperate measure of the two companies. The last step for the salvation of Android, which crushes everything in its path.

Nokia has very recently denied such future moves, instead reaffirrming their committment to Symbian and MeeGo OS, yet the rumor persists, perhaps out of wishful thinking. It is certainly possible that Nokia may release a secondary line of phones with WP7 on board--heck, Palm did the same years ago till they got back on their feet (to fall on their face again)--but we're not holding our breath on this one. For one, there is no secondary source that comes even close to backing this up and number two, financially it doesn't make much sense (see summary at ZDNet).

But we'll leave the possibility open. We're just not that confident in the idea. Even if Nokia does go forward with a Windows Phone line, so what? Has Nokia hardware (in absence of their OS) been anything truly remarkable? Or has HTC, Samsung and Apple grabbed the spotlight with hardware innovation and unique design? Call us cynical, but we're going with the latter. If Nokia and Microsoft hatch out a plan though, it will only help Windows Phone presence in the market.  That is something we could live with, even if we are skeptical of the whole idea.

Source: Mobile-review; via ZDNet

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