Nokia outlines market share and job loss risks of Microsoft partnership

Nokia has outlined the risks of partnering with Microsoft, including a "substantial reduction" to its staff and loss of marketshare.

Nokia has outlined the risks of partnering with Microsoft, including a "substantial reduction" to its staff and loss of marketshare.

Nokia and Microsoft confirmed a strategic partnership in February, with Nokia adopting Windows Phone as its primary smartphone strategy, Bing, as its search engine. Nokia will also fold its Ovi store into Microsoft's online Marketplace.

In the 275 20-Q document filing with the US Securities Exchange Commission, Nokia raises concerns over its ability to create a competitive smartphone platform with Windows Phone's "unproven" success and "very low adoption" compared to Google Android and Apple mobile platforms.

Nokia says the new strategy will also cause job cuts. "The implementation of our new strategy is expected to have a significant impact on our personnel, including substantial reductions in personnel following the appropriate consultations," said the report.

While the Finnish company confirms its commitment to the open source mobile operating system, MeeGo, and plans to sell 150 million Symbian devices in the next few years, it says it may not be able to secure a return on investment (ROI) for these platforms.

Nokia expects the transition to Windows Phone to take about two years, which could erode its currently strong brand identity worldwide, damage its Symbian product quality and cause loss of market share.

"Our mobile operator and distributor customers and consumers may no longer see our Symbian smartphones as attractive investments during the transition to Windows Phone. This would result in a loss of market share, which could be substantial, during the transition and which we may not be able to regain when quantities of Nokia Windows Phone smartphones are commercially available," the report said.

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