Can Club Nokia thwart .NET?
By Andrew Orlowski
Posted: 27/11/2001 at 01:13 GMT
theregister.co.uk
Nokia is expected to announce ambitious plans for its Club Nokia portal at its
Capital Markets Day in New York tomorrow.
Club Nokia is an overlooked part of the phone services jigsaw, but one that
will be increasingly important as the Finnish giant focuses its artillery on
Microsoft, and tries to coalesce an array of carriers and terminal suppliers
to unite against a common enema. [Don't you mean 'enemy'? - ed.]
"Nokia has always been a software company," execs told us at the Comdex
launch of its open platform a fortnight ago. With that milestone
announcement, Nokia has begun to license much of the essential goodness
that makes a Nokia phone - the user interface - along with middleware and
applications, in source form, to anyone who asks.
But the Club Nokia parlay isn't just a case of the Finns catching portalitis -
the peculiarly late-90s fashion where vendors aggregated as much useless
content in one place as they could find, in the hope of capturing traffic. No,
instead an expanded Club Nokia will become a marketplace to sell content and
services, too, much as Redmond envisages all the disparate Windows tendrils
leading back to its Hailstorm hub of web services.
In an interesting analysis of what he dubs the 'Clash of Civilisations' between
Nokia and Microsoft, a piece which puts the Club Nokia announcements into a
broader context, Keith Woolcock of Nomura Research concludes that The
Beast will ultimately prevail.
Woolcock is no Microsoft shill - in the same research note, he describes
efforts to sell the phone manufacturers its Stinger, aka the Microsoft
Smartphone platform, as having "failed miserably". But he thinks Microsoft
will prevail because of the breadth of its existing penetration in the PC
business - it's rapidly amassing customer information through Passport
already - and through the .NET development tools. Adding, too, that Club
Nokia faces competition from the carriers themselves for services portals.
Traction
It's an interesting note (and if you nag us enough, we'll nag Nomura to make it
public, somehow) but by our reckoning he's taking a highly pessimistic view.
Or optimistic, if you're Microsoft.The biggest handicap Microsoft has is that
its mobile client platform "lacks traction", as the VCs like to say. Or in other
words, no one wants a Microsoft phone. As Woolcock points out, most of the
major manufacturers have seen and declined Stinger. Only Samsung is
gung-ho about the platform, although Mitsubishi (through its Trium
subsidiary), can reasonably be expected to have a dabble. The bright British
company Sendo is betting on Stinger - but Sendo only shipped its first phone
this year. Even if Siemens and Alcatel are added to this number, it leaves
manufacturers who hold 80 per cent of the current voice handset market
doing their own thing.
And the phone business, unlike the microcomputer market in 1981, isn't
about to be taken over by a great unifying outsider: the handset
manufacturers voted for their own OS platform by creating Symbian, and
most of what else matters - like Bluetooth, WAP, or MMS - is decided in time
honoured fashion, laundered through industry committees.
There's another, more bleeding obvious reason why phones now aren't like
PCs then. There simply isn't a telcomms vendor now that is as dominant as
IBM was in 1981, even though the phone business is making the same
tottering fall from being a vertical industry into a horizontal industry, just
like the PC. People rightly credit Gates' foresight in envisaging a horizontal
personal computer business, but Microsoft's success owes much more to its
role as the preferred supplier for the IBM PC than anything else. It was the
IBM blessing, not amazing software, that legitimised Microsoft.
ASCII Art
Yet there's another factor, too, that's usually overlooked. Let's suppose
Stinger turns out to be astoundingly good, much better than the competition.
Then surely, world+dog will beat a path to the Stinger manufacturers' door,
pausing only to throw away its 2G handsets en masse. And today's phone
giants respond to the demand.
But it isn't really going to be like that: smartphones will be a luxury item at
first, getting progressively more affordable. And in the meantime, the 2G
manufacturers will exclusively be providing their own, or industry standard
applications. Microsoft has given little thought to how the splashy services
for smartphones 'degrade' on less capable handsets.
This we'll call it the ASCII Photo problem, (because it hasn't really been given
a name yet). Nokia's new imaging smartphone, the 7650, let's you take snaps
and send them as MMS messages to your friends. If your friends don't have
an MMS-capable device, they're sent a URL to a web location (Ker-Ching! It's a
web service revenue opportunity!) ... which they later access from their PC.
Now the really smart thing, we suggested to Nokia in Barcelona last week,
would be to scan the photo and create a little ASCII art picture, the kind of
which you still see in some sig files. That gets sent to the recipients crappy
little phone, and surely, joy is unconfined.We were joking but the underlying
conundrum is serious: and it's how to lure 2G phone users into the 3G
promised land.
It's a conundrum that all operators and handset manufacturers face, and one
we venture, that Microsoft is particularly badly placed to cope with. We might
be wrong, but we suspect it hasn't even given it a moment's
thought.Multimedia rich smartphones play to all Microsoft's strengths, at
least on paper. Redmond astutely saw off applications competitors in the
early 90s by appealing to the PC magazine's tick list mentality - more
features! better! - and it's successfully used this tactic to win significant
market share in the PDA battle against Palm. (Although Palm deserves much
of the blame for ceding this battle). PocketPC doesn't really win best of class
in any utility comparison - it's the most awkward address book, the worst
MP3 player, and the most expensive communicator you can buy - but it
promises the earth, and it sure looks great: the lovely retro Chrome styling
of Compaq's iPaq makes it look like an American classic.
It's personal
Despite the bewildering and frequently abstract talk of web services, this one
should be fairly simple to call. It's a battle between consumer vendors over
who owns your address book, your buddy list, and the web services that
spin-off this simple decision are the rewards for these competing armies. Our
Smartphone Roundup earlier this year drove home a couple of points: not only
is a single converged device, no matter how tacky, more useful than two
discrete gadgets (phone plus PDA), but that in a head-to-head, the more
personal device can be expected to win.
Or put another way - you can give a lot of voice to a data device, and it won't
feel like it's ubiquitous or personal. But give a little data to a voice device,
and it's your friend for life. This battle, as Nomura suggests, is truly epic,
and only a fool will declare a winner at this stage. But in terms of "stickiness"
we'll vote for a stupid voice vendor over a clever data vendor. And Nokia isn't
stupid. ® |
