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Will Nokia become collateral damage in Microsoft's battle with Apple?

Will Nokia become collateral damage in Microsoft's battle with Apple?

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From the moment of their announcement, Microsoft's Surface tablets have sat firmly entrenched in the middle of the Windows 8 spotlight. They've seized a stranglehold on the hardware conversation and focused it exclusively upon themselves. Though many have lamented the impact that will have on Microsoft's traditional PC OEM partners, what I think has gone overlooked is the effect of Surface on Microsoft's other hardware partner, Nokia.

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nokia windows 8 tablet mockup
nokia windows 8 tablet mockup

From the moment of their announcement, Microsoft's Surface tablets have sat firmly entrenched in the middle of the Windows 8 spotlight. They've seized a stranglehold on the hardware conversation and focused it exclusively upon themselves. Though many have lamented the impact that will have on Microsoft's traditional PC OEM partners, what I think has gone overlooked is the effect of Surface on Microsoft's other hardware partner, Nokia.

In the months preceding the debut of Surface, Windows 8 excitement was spread more diffusely among the many companies looking to build for the new OS — and yet Nokia's name was still the one most regularly whispered when dreams of a legitimate iPad competitor were being contemplated. Sure, you could rely on Asus to do something crazy, Acer to target rock-bottom price points, and Lenovo to serve the business classes, but the perfect Windows 8 tablet? That had to come from a design team as fastidious and demanding as Apple's, which is to say it could only come from Nokia.

Or so we thought.

Microsoft did everything we hoped Nokia would, and it did it first

As it turned out, Microsoft's research labs had been spending their time doing more than just printing 3D prototypes of new mice. Behind a veil of absolute secrecy, they had also been developing a highly refined new tablet design, based on high-grade materials like magnesium (VaporMg, in Microsoft parlance), and augmenting it with an all-new pressure-sensitive keyboard cover and a seamlessly integrated kickstand. The sheer amount of time and effort that the Redmond team invested just into the kickstand — going so far as to make sure that the way it clicks back into place sounds "right" — can be taken as evidence of a surpassing attention to detail. The Surface tablets that resulted, which share almost all external traits and differ primarily on specs, are the product of this meticulous design process and it shows.

The problem, however, is that Microsoft's great feat is Nokia's great disaster. Think about the things that would have made you love a Nokia tablet before the Surface was announced. Top of the list would have been uncompromising industrial design, high-grade materials, and some subtle innovation in interaction methods. In other words, precisely the things that make the Surface slates so desirable.

What might have been a thunderous product launch will now be just another Surface competitor

In preempting Nokia's tablet with its own effort, Microsoft has disarmed its most committed ally in the fight to build up the Windows ecosystem. If you're Nokia, how do you sell people on great design when they already have a reference point that's superlative? What sci-fi material can you introduce to make your hardware sound more appealing than VaporMg? And how do you hope to improve on a tablet cover that's only 3mm thick yet includes a full keyboard?

Nokia is already deeply invested in preparing at least one Windows 8 tablet. The company's design chief Marko Ahtisaari confessed back in March that a third of his time was being consumed by work on the otherwise unannounced slate, while Stephen Elop has repeatedly expressed Nokia's keen interest in the "broader opportunity" presented by the tablet space. The wheels are in motion and there's no going back on this plan now, particularly not for a company hemorrhaging money fast enough to have analysts asking about its cash reserves.

How many successful Windows 8 tablets can the market really support?

The dire financial straits in which Nokia finds itself are actually the reason I feel Microsoft has let its partner down. For Nokia to recover, it needs an unqualified success story in the latter half of this year. Whether it comes from Windows Phone 8 or Windows 8 hardware, at least one blockbuster product needs to be introduced to convince investors and creditors that Nokia is on the right path and to eventually drag the company's credit rating out of junk territory. Seen in such a stark all-or-nothing context, the prospect of being an also-ran, just a "very good" alternative to Microsoft's iconic Surface, must be considered unpalatable.

If there's an olive branch being extended from Redmond, it's in the limited release that Surface will get at the outset. Microsoft was careful in wording its announcement, positioning Surface as a US-only retail product in its physical Stores and making it available through a "select" few online Stores as well. That may well change with time (and commercial success), but for now it leaves open some opportunity for Nokia's tablet in the broader global market.

Microsoft is doing what's best for Microsoft, at least in the short term, with its planned launch of Surface devices. It's taking control of the entire user experience and essentially aiming to match or outdo Apple at its own game. In Steve Ballmer's words, Surface "embodies hardware and software working together." Ironically, that's also what he said on February 11th, 2011 — when Nokia and Microsoft announced their strategic alliance.