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2011-02-18
, 16:39
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Posts: 56 |
Thanked: 82 times |
Joined on Nov 2009
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#1462
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Microsoft Corp. knew it had far more at stake than Google Inc. as the two rivals competed to secure a tie-up with Nokia Corp. Losing the deal to Google could have landed a fatal blow to Microsoft's chances in the mobile market.
So Microsoft aggressively courted the Finnish cellphone giant, offering to pay billions of dollars and dangling incentives to Nokia's new boss, a former Microsoft executive. In a series of globe-spanning meetings in recent months, Nokia, too, began to see Microsoft as the best fit.
Last week, Nokia Chief Executive Stephen Elop made his decision. He bet his company's future on smartphones running Microsoft software and snubbed Google's Android.
In the end, Microsoft agreed to pay Nokia billions of dollars over the course of their multiyear agreement to help Nokia market and develop Windows Phone devices, according to Mr. Elop. It is unclear how much Google may have offered Nokia.
Intel Corp. CEO Paul Otellini said Mr. Elop went with the highest bidder. "Between Microsoft and Google he was getting incredible offers, money, to switch," Mr. Otellini told investors Thursday. Microsoft bid more, he said.
A spokesman for Google declined to comment. In a speech at a mobile-industry conference this week, Google CEO Eric Schmidt said he wished Nokia had decided to use Android for its phones and hopes the Finnish handset maker will decide to do so in the future.
Among Microsoft's inducements: It was willing to use a mapping service in its products called Navteq, offered by a company Nokia had spent $8.1 billion to acquire several years ago. Google, on the other hand, had far more invested in its own mapping service than Microsoft and was less willing to use Nokia's service, according to a person familiar with the matter.
Also, Nokia urgently wanted to reach an agreement with one of the companies in time for a London meeting with investors and analysts last Friday, and Microsoft moved more quickly than its rival to strike an alliance in time, this person said.
Nokia will also get to participate in the advertising revenue generated by Microsoft location-based services enabled by Navteq—for example, when someone searches for pizza on a Windows Phone and gets an ad for a nearby restaurant.
Mr. Elop, who joined Nokia from Microsoft in September, said during an interview this week that he began a strategic assessment of the company's options a month after taking the helm, choosing between continued development of Nokia's own software or a partnership with Microsoft or Google.
Mr. Elop said he was introduced via email to Google's Mr. Schmidt through a friend Mr. Elop described as a "thought leader or pundit" in the technology industry.
He also called Microsoft CEO Steve Ballmer, his former boss, and informed him that Nokia had started evaluating its strategic options.
Mr. Ballmer and senior Microsoft executives first met in person with Mr. Elop and counterparts at Nokia on Nov. 15 at Microsoft's Redmond, Wash., headquarters.
That was followed by a meeting on Dec. 6 at the W Hotel in Times Square in New York where executives, including Microsoft's Terry Myerson and Nokia's Jo Harlow, had to figure out whether the companies could even get Windows Phone software to run well on the underlying chips that Nokia uses in its phones. The technical dialog between the companies continued weeks later at a meeting in Reykjavík, Iceland.
Talks then shifted to business and marketing discussions at a meeting in a stuffy basement room in London in mid-January, including Microsoft mobile communications President Andy Lees and Nokia Executive Vice President Kai Öistämö.
During this time, the talks with Microsoft nearly broke down, according to a person familiar with the matter. The main issue: Nokia executives believed Microsoft was treating Nokia as it would any potential handset partner, while Nokia was making a "bet-the-company" decision on a software partner, this person said.
At that point, Microsoft executives had to show Nokia they was serious about making a deeper commitment. They also had to consider the implications of losing Nokia to Google, which was holding its own discussions with the company.
While Windows Phone has gotten positive reviews since the first handsets came out with it last November, the software hasn't made a dent in the mobile market. Microsoft software ran on only 3.1% of smartphones shipped in the fourth quarter, compared with 32.9% for Google and 30.6% for Nokia, according to research firm Canalys.
Any deal to back Google's Android by Nokia, still the world's largest maker of mobile handsets, would likely have torpedoed Windows Phone's chances. "At that point, the race is over," Mr. Elop said.
Mr. Elop said he negotiated with Mr. Schmidt and Google's top mobile executive, Andy Rubin.
Mr. Ballmer and his lieutenants headed for Helsinki in January to show how serious Microsoft was about cutting a deal. The plan was for Mr. Ballmer to fly privately into Helsinki, where he would then travel to a private Nokia facility, Mr. Elop added.
Mr. Elop said he instead got a call from Mr. Ballmer informing him that because of snow and fog, the plane wouldn't be able to land in Helsinki. About to run out of fuel, Mr. Ballmer instead landed in Stockholm. At that point, the fastest way for Mr. Ballmer to reach Helsinki was to fly commercially, Mr. Elop said, despite the greater risk that he could have been recognized.
While Mr. Ballmer was waiting quietly in the lounge, his cover was nearly blown when he was paged by name over the loudspeaker because of an error related to his plane ticket.
As momentum built over the coming weeks for a Microsoft deal, Nokia executives began to hint to Google executives that the company was leaning toward a deal with its rival.
Although their conversations were supposed to be confidential, Nokia executives were shocked when Vic Gundotra, a Google vice president, on Feb. 8 posted a message on his Twitter account that said: #feb11 "Two turkeys do not make an Eagle," an apparent reference to Nokia's investor conference on Feb. 11.
"I'm guessing they weren't happy with the way the decision was going," said Mr. Elop, who called Mr. Gundotra's message a "tweet bomb." He chimed in with his own tweet, comparing Nokia and Microsoft to the Wright Brothers: "Two bicycle makers, from Dayton Ohio, one day decided to fly."
On the evening of Feb. 10, the night before the alliance was announced, Nokia's board made the final decision to partner with Microsoft. Mr. Elop took the stage in London to sell the arrangement. Investors reacted cooly: Nokia'a American depositary shares fell 14% Feb. 11 on the New York Stock Exchange. Since Feb. 10, the stock has fallen $1.81, or 17% to $9.09.
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2011-02-18
, 16:50
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Posts: 963 |
Thanked: 626 times |
Joined on Sep 2009
@ Connecticut, USA
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#1463
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Why? Because M$ was scared to death of the potential of MeeGo/Qt and was determined to spend or do whatever it took to put a stop to it.
To M$ Linux will always be a disease that must be eradicated.
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2011-02-18
, 16:54
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Posts: 642 |
Thanked: 486 times |
Joined on Aug 2008
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#1464
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2011-02-18
, 18:16
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Posts: 1,950 |
Thanked: 1,174 times |
Joined on Jan 2008
@ Seattle, USA
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#1465
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Despite the decisions Elop has made, for better or for worse.
I think they will keep meego - they will get rid of Symbian I think, but keep Meego.
And if all goes shits up, then they can jump ship to Google, it's free for anyone to use anyway.
Personally if Nokia release Meego devices, like the N9 then I'm not too bothered - but I won't be buying any WP7 crap.
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2011-02-18
, 18:46
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Posts: 670 |
Thanked: 367 times |
Joined on Mar 2009
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#1466
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From the Wall Street Journal, a look at all the behind-the-scenes maneuvering. Good read, I've quoted the entire article.
http://online.wsj.com/article/SB1000...994792270.html
Nokia's Flirtations Put the Fear of Google Into Microsoft
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2011-02-18
, 18:48
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Posts: 670 |
Thanked: 367 times |
Joined on Mar 2009
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#1467
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I rather doubt the contract with Microsoft will allow Nokia to just "jump ship to Google". In fact, I expect it forces Nokia to greatly limit even what it does with MeeGo.
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2011-02-18
, 18:51
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Posts: 3,464 |
Thanked: 5,107 times |
Joined on Feb 2010
@ Gothenburg in Sweden
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#1468
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2011-02-18
, 18:55
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Posts: 4,384 |
Thanked: 5,524 times |
Joined on Jul 2007
@ ˙ǝɹǝɥʍou
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#1469
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Well, Nokia always said that sales were greatly exceeding their expectations. Apparently they never intended these devices to be commercially successful, but people bought them and loved them anyway.
Still, we now have CSSUs for 4 out of 5 Maemo devices so if you want to scratch an itch on an open component you can :-)
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2011-02-18
, 19:10
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Posts: 908 |
Thanked: 501 times |
Joined on Sep 2010
@ West Sussex, England
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#1470
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This story convinced me that Elop was NOT a Trojan Horse and that he believed he was acting in the best interests of Nokia shareholders. Anyone who continues to float these conspiracy claims needs to contend with this article.
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Tags |
bye-nokia, i don't even, just shoot him, just shoot me, let's elope, lockdown, meego?fail, negatron dan, nokia defiled, nokia suicide, sell tulips, step 8 out of 5, the-end?, www.elop.org |
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It's totally unimpressive that windows 7 is ported to arm, since they've rewritten most stuff anyway.
What they can't rewrite is history, the history of the wintel marriage, where intel is the assumed windows architecture.
Getting all windows software ported is not going to happen overnight, it'll take a decade.
(Not to mention forcing everyone to write new drivers)
I'm pretty sure this was their goal with the whole .net thing, but most of the software that matters doesn't use .net, and probably won't due to the drawbacks of using a VM.