Microsoft says Nokia deal good for rivals

Mon Feb 14, 2011 6:45am EST

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* Microsoft says Nokia deal to help all Windows Phone makers

* Mobile chief says money changing hands both ways

* Nokia shares down 3.6 percent

By Matt Cowan

BARCELONA, Spain, Feb 14 (Reuters) - Microsoft's (MSFT.O) deep collaboration with Nokia (NOK1V.HE) will help rival phone makers, not threaten them, the software giant's president of mobile told Reuters in an interview on Monday.

Many analysts believe that smartphone makers such as Samsung (005930.KS), HTC (2498.TW) or Sony Ericsson (6758.T)(ERICb.ST) will now embrace Google's (GOOG.O) Android platform more deeply, fearing they can no longer compete with Nokia on Windows Phone.

But Andy Lees said the vote of confidence from Nokia, which sold 100 million smartphones last year, would encourage software developers to create applications for Windows Phone, benefiting all cellphone makers using the platform.

"Having them really betting on Windows Phone as the future of their smartphone business is a big statement in terms of the potential for volume and the total ecosystem," Lees told Reuters Television at the Mobile World Congress fair in Barcelona.

"If you're a developer... would you develop to Windows Phone? Before you might have said: 'I'm not sure, because what's the ultimate volume going to be?," he said.

"Well, now the largest phone maker and also a whole set of other OEMS (original equipment makers) are already betting on the platform."

Attracting developer attention is crucial for the success of any smartphone. Apple's (AAPL.O) iPhone was a design hit in 2007 but the App Store where users could buy small software programmes to personalise their iPhones cemented its position.

Asked about Nokia Chief Executive Stephen Elop's Sunday night claim that the deal with Microsoft would be worth billions to Nokia [ID:nLDE71C0K0], Lees said the picture was complicated.

"There are royalty payments for software, they're putting search in more places, there's joint marketing that we're doing, so money is moving around, depending on which element of the business agreement it is," he said.

"Absolutely, there's money changing both ways."

Nokia investors expressed renewed scepticism about the deal on Monday, sending the shares down almost 4 percent. [ID:nLDE71D0EO]

(Writing by Georgina Prodhan; editing by Sophie Walker)

((georgina.prodhan@thomsonreuters.com; +4420 7542 7954; Reuters Messaging georgina.prodhan@thomsonreuters.com@reuters.net)) Keywords: MOBILE FAIR/MICROSOFT

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* Microsoft says Nokia deal to help all Windows Phone makers

* Mobile chief says money changing hands both ways

* Nokia shares down 3.6 percent

By Matt Cowan

BARCELONA, Spain, Feb 14 (Reuters) - Microsoft's (MSFT.O) deep collaboration with Nokia (NOK1V.HE) will help rival phone makers, not threaten them, the software giant's president of mobile told Reuters in an interview on Monday.

Many analysts believe that smartphone makers such as Samsung (005930.KS), HTC (2498.TW) or Sony Ericsson (6758.T)(ERICb.ST) will now embrace Google's (GOOG.O) Android platform more deeply, fearing they can no longer compete with Nokia on Windows Phone.

But Andy Lees said the vote of confidence from Nokia, which sold 100 million smartphones last year, would encourage software developers to create applications for Windows Phone, benefiting all cellphone makers using the platform.

"Having them really betting on Windows Phone as the future of their smartphone business is a big statement in terms of the potential for volume and the total ecosystem," Lees told Reuters Television at the Mobile World Congress fair in Barcelona.

"If you're a developer... would you develop to Windows Phone? Before you might have said: 'I'm not sure, because what's the ultimate volume going to be?," he said.

"Well, now the largest phone maker and also a whole set of other OEMS (original equipment makers) are already betting on the platform."

Attracting developer attention is crucial for the success of any smartphone. Apple's (AAPL.O) iPhone was a design hit in 2007 but the App Store where users could buy small software programmes to personalise their iPhones cemented its position.

Asked about Nokia Chief Executive Stephen Elop's Sunday night claim that the deal with Microsoft would be worth billions to Nokia [ID:nLDE71C0K0], Lees said the picture was complicated.

"There are royalty payments for software, they're putting search in more places, there's joint marketing that we're doing, so money is moving around, depending on which element of the business agreement it is," he said.

"Absolutely, there's money changing both ways."

Nokia investors expressed renewed scepticism about the deal on Monday, sending the shares down almost 4 percent. [ID:nLDE71D0EO]

(Writing by Georgina Prodhan; editing by Sophie Walker)

((georgina.prodhan@thomsonreuters.com; +4420 7542 7954; Reuters Messaging georgina.prodhan@thomsonreuters.com@reuters.net)) Keywords: MOBILE FAIR/MICROSOFT

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