A cloudy forecast for Nokia-Microsoft alliance

The Nokia-Microsoft tie-up for Office software--announced yesterday--is a clear knock against BlackBerry maker and enterprise stalwart Research In Motion, though it's unclear whether the effort will do much to further either Nokia's or Microsoft's agenda.

[1]"We do not believe having Office ... on a Symbian OS will drive enterprises away from BlackBerry," UBS analyst Maynard Um wrote in a research note to investors. Um said a Nokia-Microsoft teaming will have "little impact" on RIM's efforts in the space.

Others see more gray, however. In comments to BusinessWeek, Frost & Sullivan's Ronald Gruia said it's difficult to evaluate BlackBerry vs. Nokia-Microsoft since it's not a direct apples-to-apples comparison. Nokia executives argue the company's enterprise offerings cost less than those from RIM, and require less investment.

Nonetheless, UBS' Um said the Nokia-Microsoft teaming reveals more about the two companies' strategies than it does about the competitive landscape.

"We believe Nokia may benefit to some extent from consumer demand for Microsoft Office, but the incremental opportunity is likely to be limited," he wrote. "We believe this announcement may raise concerns about Nokia slowly relinquishing control over its own software products."

Indeed, Nokia pulled the plug on much of its Intellisync-based enterprise offerings last year--in favor of alliances with the likes of IBM and Microsoft.

As for Microsoft, the teaming highlights a relatively new tack by the company to team with vendors of rival platforms. Nokia backs Symbian, an operating system that competes directly with Microsoft's Windows Mobile platform. However, the two have played together before: In 2005 Nokia announced it would license Microsoft's ActiveSync technology for Nokia phones.

The new Nokia-Microsoft alliance for Office also comes at a time when a number of rivals are looking to expand their offerings for business customers. Executives from Google have hinted at bringing enterprise-focused additions to their Android platform, and Apple has long been pushing its iPhone into the corporate space.

But such players have a long way to travel. BusinessWeek pointed out that RIM accounted for 34 percent of smartphone sales in the stores of the largest U.S. wireless service providers, according to Avian Securities, and it boasted the most popular smartphone on the market, the BlackBerry Curve.

For more:
- see this BusinessWeek article [2]
- see this WSJ article [3] (sub. req.)