Power of Microsoft-Nokia-Blackberry trio?

Ever since Nokia ( the company my friend Saurabh loves till death and has delayed buying a new cell in spite of damaging his half-a-decade old N72 in the hope of a new perfect phone being launched by Nokia very very soon)  chief Stephen Elops announced that Windows will be the primary OS for all of Nokia smartphones, tongues have been wagging whether eventually Nokia will be taken over by Microsoft.  Reports of another troubled handset maker Research In Motion, makers of BlackBerry cell phones, being sold and the top contender to buy the company being Microsoft amongst others gives rise to a very interesting situation in case both the companies are actually bought by Microsoft.

Before going into the details of what the possible implications could be here is a quick look at why the Microsoft can easily lap these two companies.  Microsoft has around $50bn in cash reserves while the market capitalization ( for laymen, it is the total value of the company based on the value of the stock and can be calculated by multiplying the number of shares of the company and the value each stock on the stock exchanges) of Nokia and Blackberry have fallen drastically compared to 2007-08.  The market capitalization of Nokia and Blackberry maker RIM are approx $7bn and $4bn respectively.  So even if Microsoft buys both the companies it won't be much of a dent in the cash reserves.  More so debt can be easily raised and hence it is not at all difficult for Microsoft to carry out the transaction.

But why would Microsoft buy these companies and would it make business sense?  I personally feel the answer to this question would be 'YES'.  And this is why I think it can prove a formidable competition to the Androids and the iOSs of the world.  Microsoft has had a very rocky journey in the mobile space with failed attempts of Windows 5.0,6.0 and 6.1.  More so Stephen Elop is an old Microsoft guy and his intentions are inclined towards Nokia playing a major role in Microsoft's success if any.  The way Meego OS was unceremoniously stopped after N9 and also not forging a partnership with Google give us hints to think in this direction.  Meego will now continue as 'Jolla' by people who worked on Meego and have the patents as well.

As far as Nokia is concerned it is still the favorite brand among Indians (India is the second fastest growing market in the world) and as mentioned in the first line people still love it.  So Microsoft gets a  foothold in such a huge market.  Also the hardware of Nokia is undoubtedly the best.  A 3.2MP camera on a Nokia phone would do the job of a 5MP camera on a say HTC or LG.  Also it has a great battery life though it is because of the outdated Symbian OS.  So together with a few twists in the OS and riding on the Nokia brand Microsoft can succeed.  Besides Microsoft also gets the stake of Nokia in the Nokia-Siemens joint venture which lays the network for communications as well as huge number of patents in the telecom domain which are very valuable.  But there is still one space where Nokia has never been very successful except the E Series and that is the traditional domain of Blackberry, the enterprise class. And by buying Nokia, Microsoft also saves $1bn per year it pays to Nokia as fees for being the primary OS.

Until about two years ago it was a sin if a corporate person did not have a Blackberry.  Superlative security along with amazing sound quality and almost zero time email delivery made it a hit with the ' Business Class' . But with the iPhone and Android email was not an exclusive feature and slowly people started turning away from Blackberry.  But even today it has the most secure network and it is almost impossible to trace emails via the servers of the company.  Also the latest OS 10 looks very impressive.  And not to forget the battery life is better than iOS and Android barring the BOLD4.  So by buying RIM Microsoft gets the most secure network.

Microsoft itself has a huge variety of products to offer.  First it has the popular XBOX 360 which can be integrated with the cell phones and has been done with the latest Nokia offerings.  The popular Office Suite is another huge product Microsoft can add.  Besides Microsoft has a been a great marketer of products reflected in the fact that 90% of the PCs worldwide work on Windows in spite of proof that there is some flaw in the system.  Also Microsoft gets a stronghold in all categories of cell phones be it music or business.

But the biggest question remains as to whether it can integrate all the systems to form a perfect system taking the best from all systems it inherits as it has been a herculean task for Blackberry to migrate to BB OS 10 which it acquired from QNX.  Personally I'm not a fan of Microsoft and hence I wish that Nokia teams up with Android which would give the best combination ever and Blackberry comes up with the BB10 soon.  I would not like to see my favorite brand die.  Blackberry has impressed me with the call quality and the email service and plan to upgrade to a BB as soon as front facing camera becomes a norm and OS 10 arrives.