Device operating systems

OS Watch: Nokia Melts Down on the Low End

Having sold off its high-end, luxury smartphone business, Vertu, Nokia Corp. (NYSE: NOK) says it's refocusing on the low-end. But, it's scrapping the operating system it was reportedly designing to target this market.

Sources tell AllThingsD that Nokia is ceasing work on the Linux-based OS, Meltemi, to instead focus on its S40 line of Asha phones. The thing is, however, Nokia never confirmed it was ever working on the super low-cost OS, which was rumored last year. Asked about the OS on the call, Nokia CEO Stephen Elop said:

We’ve never publicly used the term that you mentioned, so we don’t have any specific comments on a specific engineering effort, although it is the case that we have canceled certain specific engineering projects as part of our changes.

On the same call, announcing Nokia's massive restructuring plans, Elop admitted the handset maker was feeling the squeeze from low-end Android devices, but it plans to develop low-cost, full touch-screen Windows Phone devices to compete. It's reliance on the Windows Phone OS has many thinking an acquisition by Microsoft Corp. (Nasdaq: MSFT) may be in the cards for the struggling company. (See Nokia Poll: Microsoft Merger Expected, Light Reading Poll: What Will Nokia Be in 2014?, Nokia Cuts 10,000 Jobs, Restructures and Analyst: Nokia Faces Low-End Threat.)

In other mobile OS news:

  • RIM's $1,890 Porshe in your pocket: Another struggling handset maker, BlackBerry , is taking the opposite approach of Nokia and going after the extremely high end. The BlackBerry maker's $1,890 Porsche smartphone went on sale Thursday. RIM CEO Thorston Heins and the head of the Porsche Design Group launched the phone with an over-the-top party in Toronto last night. So far, Beyonce, Jay-Z, Piers Morgan and Kanye West are all apparently toting RIM's statement piece. The company has been struggling across the board, but does have a good hunk of cash on hand -- or at least it did until last night. (See Report: RIM to Cut 2,000 More Jobs and RIM to Sell the BlackBerry Farm?)

  • Microsoft's tablet ambitions: In light of Nokia's troubles, partner Microsoft may be looking to branch out on its own with a new tablet. The company has teased a "big announcement" coming Monday at a press conference it's holding, and The Wrap suggests the news will be the launch of its first, self-branded Windows 8 tablet to compete with Apple Inc. (Nasdaq: AAPL)'s iPad. At the least, the company is expected to show off some partner tablets featuring the latest version of its OS.
  • Social networking rumors abound: In the social rumors sphere this week, Samsung Corp. may be working to build its own Facebook competitor for Internet-connected devices, and Microsoft may buy enterprise-focused site Yammer, Bloomberg says. Microsoft would reportedly use the site's software to target its corporate customers with better collaboration tools.

  • Apple has its fragmentation woes too: Apple unveiled its latest iOS 6 on Monday, and the update has some complaining of Android-style fragmentation. iPhone 3G and iPhone 4 users won't get access to all of the 200 new features of the latest version of iOS. For example, voice navigation on Apple's new maps platform will only work on the iPhone 4S, iPad 2 and the latest iPad. The iPhone 3GS won't support FaceTime over 3G either. Apple CEO Tim Cook pointed out in his keynote that nearly all iPhone users are running the latest OS version, compared to the 7 percent on Android's latest Ice Cream Sandwich, but he could get a taste of the frag backlash Google experiences this fall. (See Apple iOS 6 Shakes Up Mobile Communications and Battle of the 3-D Mobile Maps.)

    — Sarah Reedy, Senior Reporter, Light Reading Mobile

  • schlettie 12/5/2012 | 5:30:06 PM
    re: OS Watch: Nokia Melts Down on the Low End

    How is Nokia going to build competitively priced phones at the low end with Microsoft royalties baked in?

    krishanguru143 12/5/2012 | 5:30:04 PM
    re: OS Watch: Nokia Melts Down on the Low End

    If Microsoft wants market share they might have to give it away.  I think at the low-end WP could be successful. It uses low-end hardware and low-end features.  If Nokia wants to survive, they need a true smartphone OS to use on the mid and high-end.  They could still sell some midrange WP phones, but WP will never compete in the upper tiers.


    The bigger question is, could Microsoft actually acquire Nokia?  There will be many reviews of any acquisition plan.  Elop a former Microsoft officer still holds Microsoft stock.  Nokia and Microsoft pre-Elop being CEO of Nokia were competitors.  One has to question is he wants Nokia to succeed or not?  If Nokia did everything without Microsoft Elop could make a sizeable sum.  If Microsoft bought Nokia, then Elop would be helping his MSFT holdings as well as cement a future at Microsoft as well and could make an even bigger fortune.  Elop holding MSFT stock is a conflict of interest.  If MSFT did buy Nokia it would be at a loss to the shareholders of Nokia.  So either lawsuits could be filed on behalf of the shareholders or he governments around could take a really big hard look at any acquisition.


    What really gets me is that he received a bonus for 2011.  A bonus for what?  They went from profitability to being unprofitable, their market share plunged to less than half of what it was and Nokia is in far worse shape now than they were before he joined.  Shouldn't a bonus be tied to some performance metrics that the company must meet?  Surely the board didn’t set those as being the goal.

    ethertype 12/5/2012 | 5:30:04 PM
    re: OS Watch: Nokia Melts Down on the Low End

    I think you're trolling a bit by calling Apple's OS evolution "fragmentation".  (Well, hey, it worked, because here I am commenting.)  What you're really describing is backward compatibility, not fragmentation. Sometimes OS evolution has to go hand in hand with hardware evolution.  Expecting full feature compatibility back through multiple hardware generations is not realistic, nor has it ever been.

    Apple's OS backward compatibility story is really not even comparable to the amount of fragmentation on Android, where you find multiple incompatible hardware versions and extensions WITHIN a single OS "version."  To get visual sense of how bad things are with Android, check http://www.bgr.com/2012/05/16/....

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