Microsoft and Nokia.
This ‘transformation’, turning Microsoft into a ‘devices and services’ company, is key to the company's continuing survival, and would be impossible without Nokia. Here are four reasons why the acquisition had to happen: Microsoft need to keep its momentum
Recent industry figures have shown Microsoft’s Windows Phone 8 posting its highest ever market share allowing the mobile OS to leapfrog BlackBerry and become the third-most popular globally. This means that Windows Phone only holds 3.7 per cent of the global market – a tiny figure compared to Android, but still a significant amount of growth considering the entrenched ecosystems Microsoft are in competition with. Meanwhile, figures released by BGR note that 81.6 per cent of all Windows Phone sales coming from Nokia hardware, and as Ballmer noted during the Nokia conference: "sales of Nokia Windows Phones have gone from literally zero two years ago to 7.4 million units in the most recently reported quarter.” It seems logical that if Microsoft want to capitalise on this momentum, small though it is, then assuming direct control of Nokia’s resources was the best way to go.
Unifying hardware and software
This direct control will mean better integration of handsets with Windows Phone 8. Apple is the best example of this approach to the mobile industry as they keep the production of both hardware and software in-house. This benefits developers by reducing OS fragmentation and creating consistent hardware specifications it boosts the OS’s security by encouraging users to update to the latest version of the software; and it means that the user-experience is generally more consistent, leading to greater trust in the brand. And of course, Microsoft have already tried this unified approach before, a move which led only to the $900m write-down of the Surface tablets. These were specifically designed to fit perfectly with Windows 8, crossing the divide between touchscreen devices and laptops....
Please join StudyMode to read the full document