Analysts: Nokia’s Move to Microsoft Only Strengthens Apple


Credit: epicharmus/Flickr
Credit: epicharmus/Flickr

What does Nokia’s decision to junk Symbian for Microsoft Windows Phone 7 mean for Apple? The view on Wall Street is that the Cupertino, Calif. iPhone maker will stay strong – and its strength only increase the longer the Finnish cell phone maker waits to release handsets.

“The more time it takes for [Nokia] to launch their product, the tougher it will be for them to compete against iOS and Android-based devices,” ISI analyst Abey Lamba remarked Friday. Lamba expects Apple “will remain the leader.”

This point was echoed by Mark McKenzie, analyst with Gleacher & Company. Although teaming with cell phone giant Nokia could help Microsoft move up from its current third-place market share position, “it is a ways behind Apple and Google. Nokia will have to move fast or else see its handset division descend into negative cash flow,” said McKenzie. He notes both carriers and developers are already distancing themselves from Nokia’s Symbian platform.

While the timing of a device launch could decide the success of the Nokia-Microsoft tie-up, another factor is the number of applications available when a handset launches. Apple reportedly has up to a year’s lead-time on any device coming from Thursday’s announcement and the Cupertino, Calif. firm has a huge lead in applications available for its iPhone and iPad customers.

Indeed, MKM Partners’ analyst Tero Kuittinen predicts “profound problems” for Nokia’s bottom-line if the phone maker can’t introduce a Windows handset by the fourth quarter.

A day prior to the Nokia shakeup, CEO Elsop told his company employees “Apple owns the high-end range” of smartphones. In the memo, the Nokia leader also admitted its rivals are taking market share by offering a complete ecosystem, something that Microsoft might be able to provide.

But if Apple owns the high-end, it is making moves to also eat into the low-end prepaid market. Reports surfaced recently the tech giant is working on a pay-as-you-go iPhone nano that might cost $200.

[Barron’s, Business Insider]