Nokia teams with Yahoo to bridge gap to rivals

Nokia and Yahoo have agreed a deal that sees Yahoo take control of Nokia’s Ovi messaging services, and Nokia provide mapping services for Yahoo!
 
The deal, unveiled yesterday, should give Nokia better traction in North America – a market it has traditionally struggled in -, while helping Yahoo find its way in location based services by leveraging Nokia’s extensive Ovi Maps portfolio.
 
It is also designed to help the firms close the gap on rivals Apple – which is eating into Nokia’s share of the smartphone market -, and Google, which has Yahoo on the ropes when it comes to navigation services.
 
Yahoo’s maps will  carry the “powered by Ovi” tag, with the reverse moniker attached to the Finnish vendor’s little-known Ovi Mail and Ovi Chat services, which will be distributed by Yahoo, when the first services go live in 2H10.
 
The pair will also work to ally user IDs, so Ovi users can access selected Yahoo services using their existing login details.
 
“Yahoo's online expertise will bring exciting mail and messaging enhancements to millions of Ovi Mail customers,” Nokia CEO Olli-Pekka Kallasvuo said.
 
He acknowledged the importance of the deal in boosting Nokia’s presence in North America, which remained the vendor’s weakest market during Q1, with sales of €219 million down 27% on Q109.
 
Carol Bartz, CEO of Yahoo, said the deal would boost her firm’s presence in emerging markets – one of Nokia’s strong points - after conceding the firm had lost its way in the navigation market in a press conference.
 
Usage of Ovi Maps has spiked in usage after the firm began offering the application for free in late January.
 
While the two firms paint a rosy picture, Current Analysis analyst Avi Greengart told WSJ.com they were simply painting over the cracks and that structural changes were needed at both companies.

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