So you reckon Nokia-wielding Microsoft can't beat off Apple?

Developers? Nah, it's all about consumers

Consumers liked Apple because it made phones for consumers, not mobile operator customers. The experience was slicker – but that was then and this is now. Today iOS, Android, BB10 and Windows Phone are all much more consumer-centric. Apple’s greatest asset is that it is fashionable, a cool brand, but fashion is fickle - as Crocs and Uggs will tell you.

This is nothing to do with technical prowess. Most people don’t know what multi-tasking, Bluetooth Smart or Category 4 LTE is. They might like “how it works”, by which they mean “what it does”. But in reality a lot of that is perception and if you like the brand and how it makes you feel, you exercise confirmation bias and end up liking one user interface over another and overlooking similar irritations.

For instance, I hate the way Windows Phone doesn’t have separate volume controls for different alerts and apps. So if I turn the volume all the way down to play games on the train, and then forget to turn it back up I miss calls. Worse it switches to vibrate when it is all the way down and so if I remember to turn the volume back up I need to explicitly switch from vibrate to ring.

But the active tiles are so good that the UI’s other foibles are forgiveable. Ask a significant number of people as to why they have a particular phone and they will say “the camera is good”. Dig deeper, ask the Apple customer why they didn’t buy a Lumia or Xperia – both of which have better cameras – and the real answer is “I like Apple”. We all do the confirmation bias thing.

Fashion

And fashion is a really, really powerful tool. Just as Motorola revived its fortunes for a while by combining of marketing and product with its “hello Moto” campaign, ultimately its problems were too deep.

Big company strategy is not usually a good place to start with a fashion play but the two might just come together with Microsoft. The plan to bring Windows, Windows Phone and Xbox closer together might be platform and developer-led but to a key influencer section – the mavens – Xbox is cool. Kinect 2.0 being able to tell when you are sweating might be spooky to some, but the view from those who aspire to being a Halo Spartan or Titanfall Mechwarrior is that the Xbox One has street cred.

Getting this right is far more important than Microsoft’s playing to its home territory of BYOD, MDM and corporate backends. Yes all that should be in place, but it needs to wait for the consumer pull. People in suits don’t like being told they have to use a phone because the IT department supports it. The phone needs to be made cool to the end users while doing everything the IT department mandates.

What should MS do next?

Historically, the Windows Phones with a keyboard have not sold well. There are so many people who will tell you that they only use a BlackBerry because they don’t want to type on a touchscreen. But there must be a significant (and influential) market for the love child of a Surface and Communicator. QWERTY on the inside 12 key keypad, e-ink on the outside and super thin.

Nokia within Microsoft could be awesome. There will be some inevitable cutting back, however, and as a start Microsoft should divest itself of the non-smartphone business. In addition, Elop has made no secret of the Nokia name being dropped well within the two years for which Microsoft has the licence to use it.

Similarly, the Android stuff should go, ideally along with the dumb phones. It’s not that Android itself is a bad idea, however people get horribly religious about OSes and having the Google interloper in the Microsoft camp will never work and alienate the Americans against the Finns. Remember very little is about how good or bad a product is. Politics is, unfortunately far more important.

Where technology and fashion meet is when a piece of technology makes something cool. Just as when Nokia, Ericsson and Motorola were worrying about each other, BlackBerry and Apple came from nowhere, there is always the risk of a new challenger. Everyone should be keeping a watchful eye on Amazon. A 3D phone might be the next major differentiator.

Microsoft should look at how Google took a $6bn bath on Motorola and avoid making the same mistakes. Taking stock of what Nokia is good at – radio, hardware, particularly platform design and especially supply chain – is the key to making the acquisition work.

Don't be too quick to dismiss Nokia supply chain wonks, MS

The supply chain is important at both ends. Nokia gets its suppliers to work together without getting in the way. It dominates suppliers and drives down costs. Nokia still sell over half a million phones a day, around 400 a minute and that is significant buying power. In the time you’ve spent reading this article, Nokia will have shifted a pile of boxes taller than the Angel of the North.

More important, and this is the thing that Microsoft really must not damage, is the outward supply chain – the route to markets. The ability to get phones in the hands to customers in rural parts of India and Africa is something Samsung can approach, but Apple just can’t touch. In India the word “Nokia” is a colloquialism for mobile phone. The local distributors can deliver daily, and this matters hugely to dealers who lack the the funds to carry stock. With pricey phones like the Lumia 630 this is essential.

Taking on Nokia, its people and technologies will be hard for Microsoft. Pulling together the business partners, the competitive landscape and the industry Microsoft thinks it understands, but doesn’t, is very much more of a challenge and the key to this will be listening to the people in Espoo with the grey hair and the battle scars. ®