Posted by Matt Egan 24 February 2014
Why Nokia has released an Android phone: it isn't for me or for you
Why Nokia has launched three Android phones, and why it isn't bad news for Windows Phone.
This morning held a press conference in which it announced five new phones... and not one of them was a Windows Phone. Three of the new Nokia handsets run Android, OS of Windows' mortal enemy Google. For Nokia - the company that (a) committed to Windows and (b) has now been bought by Windows-maker Microsoft - this is a radical move. So what's going on?
The clue is in the pricing. The five handsets announced today all cost less than £100. you could buy them all at once for less than half the cost of the top-of-the-range iPhone. They range in price from 29 Euros to 109 Euros. And that is very cheap for a connected phone.
The two cheaper ones - the Nokia 220 and the Nokia Asha 230 - don't even run Android. The 220 is a feature phone with no named OS. The Asha 230 runs the Asha OS - a very basic smartphone platform.The more basic and proprietary the OS, the cheaper the phone is to build.
Ranging above these are the Android handsets - the Nokia X, Nokia X+ and Nokia XL. These are full-featured smartphones, with lowish specs. They run a version of Android that looks like Windows Phone, and offers access to multiple app stores. (Indeed, it remains to be seen just how easy it is to install Android apps. These Android phones may, like many you find in Chine, have very little about them that is Androidy.)
And they are aimed at the all-important sub-£100 market. Running a free or open OS such as Android or Asha allows Nokia to hit that sub-£100 sweet spot. It also allows Nokia to differentiate its more expensive, high-class phones. And maintain profit margins in those phones. If you could buy a 4in Lumia for £50 you wouldn't easily be persuaded to spend £400 on one, now would you?
Budget smartphones are where it's at
The budget market is where all the growth is in smartphones. Both in the western world where the Lumia 520 is Nokia's most popular phone (it costs £109) and more importantly in the developing world.
Nokia claims around 10 percent market share in several major markets in Europe. That's probably as good as it will get for Windows Phone. It's quite impressive for a single OEM platform, and it should mean Nokia and Microsoft make a healthy profit there. But now that everyone who wants an expensive smartphone has one, it is going to be difficult for Nokia to increase market share in these markets. So it will attack the market from the bottom, making handsets for those people who like the idea of a smartphone but can't or won't pay out more than £100. Like your mum or dad, the person who likes using Facebook and would like to do so on their phone.
When you consider that for those people the option is usually a cheap Android with an early Android OS, the Nokia phones start to look like a great deal. They'll do well. On specs and reputation alone I'd certainly recommenend them, pending a proper test.
Nokia's pitch for the developing world
More important is the developing world. Nokia talks about getting the 'next billion' users on to connected smartphones.
For people in many parts of the world the infrastructure needed to provide fixed-line broadband is (literally) a pipe dream, but cellular connectivity offers all the possibilities of the web. In markets such as China, sub-Saharan Africa and South America the fight is on to win over new smartphone users, and keep them as their countries rise in GDP and living standards. Lenovo's recent purchase of Motorola was one sign of the big phone makers jockeying for position here. Nokia's announcement today was another.
Although it said its new handsets would be available globally, Nokia kept saying that the focus would be on emerging markets. By blending Android with Windows Phone it has created a cheaper set of phones that offer something approaching the high-end smartphone experience. And with the 220 and 230 it has handsets that offer true connectivity at a price affordable to many more users than is currently the case.
Your 'burner phone' is someone else's power PC
(A quick side note here. It was interesting that when Nokia announced that the 220 would cost 29 Euros, lots of US and UK bloggers referred to it as a 'burner' phone. A phone to be used and then thrown away. To which I would say only this: if you live in the developing world, 29 Euros is a significant investment. The Nokia 220 is intended as the principle phone for relatively wealthy people in very poor countries. Its motives are commercial, but Nokia is to be applauded for this.)
Windows Phone is doing okay
Even though Nokia never really mentioned Windows Phone in today's announcement, I don't think any of this is a real sign that Windows Phone is in trouble. Rather, it shows that Nokia is positioning Windows Phone as the premium platform. Windows Phone is a curated environment and experience. It is secure, although not massively customisable. And it offers great server-side support for business.
You can get a Nokia Lumia Windows 'Phone' in every size from 4in to 10in, in various colours and at a carefully aligned array of price points. And your IT department will thank you for doing so.
The Nokia X handsets maintain the same visual style, access some Windows services and many Nokia apps. But they are a step below the Lumia Windows phones, aimed at the rapidly developing sub-£100 markets in the western- and developing worlds.
Interesting times in the global smartphone world, dear reader. Interesting times. (See also: why you should buy a Windows phone... now.)