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Five Year Predictions: Nokia

Editorial by admin on Monday October 13, 2014.

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We are introducing a new series today in the form of Five Year Predictions. Each week we will take a look at a major brand in the mobile space and will see where the company is now, what its short term future looks like, and finally where we think the brand will be in five year's time. We cannot please everyone and get everything right, but we hope this series will give more of an insight into the plans of companies as we enter the next phase of mobile technology. Kicking it all off is Nokia.

Nokia Now

I was one of those people who did not want Nokia to sell its devices and services division to Microsoft, mainly because I am of a vintage that remembers when the Finnish phone maker strode atop the mobile world in a manner that would make Apple think it needs to employ a new marketing team. Those days, of course, are long gone, but the more I think about it the more I realise that in the long run at least Nokia is better off.

Nokia had fallen a long way, even if the company did happen to still be building some excellent smartphones. The brand had become the poster boy for the third best operating system on the market and was becoming synonymous with both Windows Phone and Microsoft. Of course, Microsoft's platform probably wouldn't be chugging along today if it wasn't for Nokia, but the company was feeling more like a subsidiary of Microsoft than a standalone brand.

It seemed perfect sense then for Nokia to sell off its mobile division, run with the $5 billion cash and one day be able to return to making smartphones. One day Nokia will be able to return to making handsets, while the company has effectively been handed back the reigns to its feature phones by Microsoft deciding to ditch them. Sure, feature phones are not where it is at these days, but they provided a steady bottom line for Nokia, and would have for Microsoft too.

In the meantime Nokia is repositioning itself as a services company. The Espoo, Finland based company has already released a highly praised Android launcher this year, while a new partnership with Samsung points to a multitude of possibilities in the future. One of the key points of the sales of its mobile division to Microsoft was that Nokia got to keep its HERE maps service.

The Near Future

HERE Maps is highly regarded and is a true competitor to Google's own admittedly wonderful Google Maps. The service is taking baby steps to being able to compete with Google on a large scale and Nokia has this past weekend struck a deal with Samsung for the Korean giant to offer HERE Maps. Yes, Nokia once dominated Samsung in the mobile sphere, but times have changed and now the companies are working together on a deal that may have wide ranging consequences across the whole mobile space in the future.

Firstly, HERE Maps is already popular on Windows Phone as a downloadable app, but the limitations of Microsoft's OS in terms of market appeal means Nokia's service needs other outlets. The company has struck a deal with Samsung that will see HERE Maps placed inside the Korean company's Galaxy Apps Store running on most of its devices.

Here's the thing, the Galaxy Apps Store is rarely used by Samsung users simply because they have the Google Play Store right on their doorstep. So, HERE Maps is not going to suddenly become an overnight sensation, although Samsung is clearly hoping that it could drive more users to its own store. And that's sort of the point, Samsung is actively seeking ways to stand on its own two feet and as the years go on Nokia could play an important part in that.

Samsung recently moved all (nearly) of its smartwatch products over to its own Tizen ecosystem, an OS the company made with Intel. While the company is cautious about the language it uses, there is little doubt that one day Samsung hopes that Tizen is a big presence in the mobile arena. The company is developing handsets for the platform and almost certainly envisages a day when the majority of its products run Tizen and not Android.

In other words, a Samsung/Google breakup is not beyond the realms of probability and in fact seems certain to happen. With Samsung's vast resources, if the company can get it right and make Tizen a success, hundreds of millions of smartphones sold each year will be running it. Guess which company will be supplying the maps service? Yes, that's right, Nokia.

If Nokia and Samsung's initial partnership goes well the Finnish company could also supply other services to the Tizen ecosystem. It is probably a no lose situation for Nokia because if Tizen fails it can just move on, but if Tizen is a success it will reap rewards from that.

How long a workable Tizen platform will take to come into action remains to be seen, but it is likely at least two years off. In the meantime Nokia will have to busy itself with other things, probably more services; but the big goal for the brand (Tizen or not) is that it wants to get back to making hardware products.

Microsoft's buyout of Nokia's devices and services divisions left behind a still functional company that can start building smartphones again in 2016, when Microsoft's licensing agreement expires. What's more, those devices will be sold under the Nokia branding, a name in the industry that still holds plenty of sway. Interestingly, once Nokia remerges as a smartphone manufacturer, the company can build on any platform it wants.

That of course means that Nokia being an Android supporting company is very likely, and once again the Nokia brand will be front and center on the most popular OS in the world. Whether Microsoft will let the company build on Windows Phone remains to be seen, while Samsung's plans for Tizen are not clear enough to know if it will allow third party devices.

The 5 year prediction

In five years Nokia will be:

Building smartphones again

Making smartphones for Android

Be a major partner on Tizen's growing market space

In the wearable space (Microsoft's buyout did not include any smartwatch plans)

Making the bulk of its income from services

So, that's the MobileBurn 5 year prediction for Nokia. What do you think, do you agree, or do you see the company taking another path? Also, which company would you like to see us tackle next? Let us know in the comments below!

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