Apple and Nokia - The Perception Shift of Hardware and Software
by Ewan Spence
How times change. The last week has seen one technology company gather the press and media together to announce a tweaked product line-up that surprised absolutely nobody, while another announced the first device to launch one of the most intriguing and potentially game changing music service in the last few years.
The fact that the staid company was Apple and the innovator was Nokia seems to have escaped everyone’s notice.
The switch in fortunes may or may not continue – there can be no doubt that both companies have their innovation labs working at full speed for new products, but it’s going to be very hard for a pure hardware play to provide a significant win on the quarterly company reports. The future is going to be in software, and the services that are being provided.
In that light, Nokia’s Comes With Music serivce is a very interesting half way house – on certain phone models you will also get a one year subscription to Nokia’s Music Store that allows you to download as much music as you want, and keep it when the year is up. Note that it is Windows Media DRM so there are some transfer restrictions). It’s doubtful that Nokia are making any profit on this service, although do expect the price of the handset with the service to be higher than a vanilla phone.
What it does do is provide a service that helps people make their purchasing decision.
Nokia’s major play is something called Ovi, which ties in a number of software services (mapping, gaming, over the air sync of files and data, and a few other tricks as well), and Nokia are hoping that these services provide a stickiness to their offerings in these days of almost identical technical specs. The news from CTIA that Rogers Canada will be using their Maps and Gaming service for their High-Speed customers is one of the more interesting developments in this field.
Apple have a similar service as well, in the MobileMe although it should be noted that all these services are subscription based (whereas Nokia only asks for a fee if you use their off-line file-sync section), and both companies have Application Stories available for developers – of course Apple’s iPhone store is the only store availabel to developers, Nokia continues to believe in an almost fully open software ecosystem.
It’s no longer enough to have a really nice piece of hardware (like the iPod). You need to have something behind it that provides more value to the user, and keep them coming back to your platform. Apple’s recent music event shows that the day of the standalone are no longer enough. Their future has to lie in devices like the iPhone (and arguably the iPod Touch making a tablet play) or the Nokia tablets and smartphones that tie you to the servers of a company with a subtle enough touch that you could move away, but don’t want to.
Something Apple hasn’t quite mastered yet for the smartphone, but Nokia are managing quite nicely.



















