Wednesday, September 4, 2013

For BlackBerry, Bad News in the Microsoft-Nokia Marriage $NOK $BBRY $MSFT

For BlackBerry, Bad News in the Microsoft-Nokia Marriage

If misery loves company, BlackBerry had a friend in Nokia while both companies were struggling to adapt to a changed mobile phone world.
But Microsoft’s purchase of Nokia’s handset and services business, some analysts said on Monday, may now make it harder for BlackBerry to find its own savior and will only underscore the Canadian company’s fundamental problems.
“BlackBerry always looked small fry,” said Nick Spencer, the senior practice director for ABI Research in London. “Now they look even more small fry. They’re up against three of the biggest companies in the world.”
Once the dominant maker of smartphones, BlackBerry has spent the last couple of years vying with Microsoft’s Windows Phone operating system for third place in a market overwhelmingly dominated by Apple’s iPhones and phones using Google’s Android operating system. The general indifference that greeted a new line of BlackBerrys introduced earlier this year, along with a new, more sophisticated BlackBerry operating system, led the company to say last month that it is “exploring strategic options” including a sale.
Reports, which were never confirmed, said Microsoft had at least kicked BlackBerry’s tires at some point but decided not to bid for the company. But its purchase of Nokia, which had already adopted Windows Phone for its handsets, rules out any slim hope that Microsoft’s wealth and other resources might provide a solution to BlackBerry’s problems.
While Mr. Spencer believes that BlackBerry is most likely to be broken into separate pieces of varying interest to buyers, he said the Microsoft transaction could provide BlackBerry with a new, if slim, hope for salvation. Apple, like BlackBerry, has always designed and controlled both its handsets and operating system. Google acquired Motorola just over a year ago. With the Nokia purchase, Windows Phone is also allied to a hardware brand.
That makes Samsung, which mainly uses Android in its market-leading handsets, the odd man out, Mr. Spencer said. There is, he said, the possibility that it might consider buying BlackBerry “if it also decides end-to-end software and hardware is the way to go.”

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