Is this the end of standalone wireless phone manufacturers?
As I noted roughly four years ago, the wireless phone business is cyclical. When I started at Motorola in 2000, the common message was that Motorola was uncool, and that Nokia was cool. Then RAZR hit, and the perceptions were reversed…for a time. But soon enough, the message was that Motorola was uncool and that Nokia was cool. If you fast forward to the time that I wrote my post in 2009, one analyst was noting that Nokia’s smartphone share was declining “in the face of competition from Apple and BlackBerry-maker Research in Motion.”
Yeah, Research in Motion.
Times certainly do change.
But the bigger change that goes beyond the current fads or trends is the change in wireless phone manufacturer organization. Take Motorola. My former employer split in two, so that the police radio business (that used to include automated fingerprint identification systems) and the mobile phone business were two separate firms. The latter firm ended up getting snapped up by Google.
And now Nokia’s mobile phone business has been snapped up by Microsoft.
Both of these are examples of vertical integration, where the same company provides both the software (the wireless device operating system) and the hardware (the wireless device itself). (Apple, of course, has followed this model throughout its history.)
Nokia had adopted such a strategy just three years ago – successfully – but wasn’t able to maintain Symbian’s OS lead. So Symbian was outsourced, and Nokia got closer to Microsoft. And now they’re closer.