Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) CEO Steven Elop says that he thinks Windows Phone 8 will win the mobile operating system battle.
However, skeptics will see this as little more than publicity generating optimism, but the idea has to be taken on its own merits. Can Windows Phone and Nokia come out on top in the mobile market?
The CEO made the comments in an interview with Bloomberg earlier today. When asked whether or not he saw Windows Phone ever getting to number two in the mobile market, Steven Elop said that he thinks the Windows Phone system will, eventually, come out on top.
Microsoft Corporation (NASDAQ:MSFT) has worked long and hard on the Windows Phone system. Its recruitment of Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) to that battle was not a victory, and it has not played entirely well since the launch of Windows Phone 8. What advantages does the Windows Phone system have? How could it ever end up on top?
Emerging markets are a clear opportunity, and Nokia has maintained a strong brand in those markets for years. The firm released new low end Windows Phone models earlier in February.
There is little advantage to Windows Phone in these markets, however. Competitors are offering devices on Google Inc (NASDAQ:GOOG) Android for the same prices or cheaper. Emerging markets are an opportunity for Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V), but the company has no discernible advantage there.
Microsoft Corporation (NASDAQ:MSFT) has one prime advantage. It’s desktop operating system is still by far the world’s most popular. No competitor is likely to overtake them before the death of the PC market. The reason for the product’s longevity is its position in enterprise.
In recent years many large companies have switched to a “bring your own device model. There are disadvantages to this that limit its potential, and there may be a rejection of it in the coming years. The most important weakness in the model is the inability to ensure security of information across so many different devices.
Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) and Microsoft Corporation (NASDAQ:MSFT) have an opportunity here, as they have the greatest ability to integrate with current enterprise systems.
Microsoft needs to leverage the dying PC market to catapult itself into the mobile market. There is competition out there, most notably from Research In Motion Ltd (NASDAQ:BBRY) (TSE:BB).
There is an opportunity for Nokia, and the top spot is achievable. It’s not likely however.