Now that Nokia has signed up with Microsoft to utilize the Windows Phone 7 operating system, Intel is still pushing ahead with the MeeGo operating system. According to the latest report from Reuters, Intel is blaming the decision for Nokia to shy away from its joint MeeGo collaboration due to financial incentives being offered by Microsoft.
MeeGo was introduced last year at Mobile World Congress as a joint collaboration between Intel and Nokia as the two folded their respective Moblin and Maemo operating system into the open-source Linux-base OS that was positioned as a contender against iOS and Android. MeeGo represented an opportunity for the two smartphone underdogs in the U.S. smartphone market to gain market share and traction. Nokia, while a leading phone manufacturer worldwide, has had troubles entering the U.S. market with its Symbian platform. Intel, which makes chips inside desktops, laptops, and netbooks, wants to place its Atom chips inside smartphones and tablets and faces an uphill battle against chip-makers who use ARM reference designs, like NVIDIA, Qualcomm, Samsung, and Apple with its proprietary A4 chips. MeeGo, for Intel and Nokia, would be an entry into the competitive smartphone market.
However, since the MWC announcement last year, Nokia is now steered by a different captain–Stephen Elop, who is a former Microsoft executive. Intel’s CEO thought that Elop’s decision was a bad one, and says that if he were Elop, he would have gone with the Android platform, but conceded that he understood Nokia could not afford to spend too much resources on MeeGo development. “I wouldn’t have made the decision he made, I would probably have gone to Android if I were him,” he said. “MeeGo would have been the best strategy but he concluded he couldn’t afford it.”
Intel further says that the decision to go with Microsoft was based on financial incentives, stating that Microsoft offered “incredible” sums of money for Nokia to use Windows Phone 7. Google CEO Eric Schmidt had admitted that he had spent considerable time courting Nokia to use Android, but Nokia’s Elop worried that utilizing Android would lead to the commoditization of the Android brand. Additionally, there was also a lot of established players in the Android ecosystem such as HTC, Motorola, and Samsung, and competition is fierce. Going with Windows Phone 7, Microsoft made an unusual concession in giving Nokia carte blanche access to modify and change Windows Phone 7 code to customize and tweak as they pleased. This would allow Nokia to differentiate from other Windows Phone 7 OEMs and offer value to its end users.
For now, Intel is looking for other partner(s) for the MeeGo project. Nokia, in adopting Windows Phone 7, has stated that MeeGo will now be an experimental platform. The phone-maker has already cancelled its first MeeGo phones. Rumors have it that carriers were concerned that the hinge on the first device–which was said to utilize a sliding form factor–was not sturdy enough. That rumor seems a bit dubious as Nokia has used the form factor previously in the Nokia N97, N97 Mini, and the E7 smartphones, all of which have good build quality and run the Symbian OS. The exact reasoning for the initial MeeGo smartphone’s cancellation was not disclosed by Nokia, but the company is expected to release a MeeGo phone later this year–perhaps its first and last device unless that platform gains traction that would warrant further investment.
Intel’s CEO says that carriers want a third ecosystem and highlights openness as an attractive quality. That means that Intel views iOS and Android as its chief rivals for MeeGo and doesn’t consider Windows Phone 7, webOS, or the BlackBerry OS as contenders, either due to the closed OS nature, limited adoption, or declining mind share as in the case of the BlackBerry in light of more consumer-centric releases from Apple and Google in recent months. More recently, Motorola and Verizon Wireless have expressed cordial disinterest in Windows Phone 7, even though the latter will still offer devices running that OS in its lineup later this year. Even Asus, which released early Windows Phone 7 prototypes and was an early partner of the platform, has not released a single Windows Phone 7 consumer device and is still evaluating its strategy for the platform.
“We will find another partner. The carriers still want a third ecosystem and the carriers want an open ecosystem, and that’s the thing that drives our motivation,” Intel says.
Since Nokia’s announcements surrounding its Windows Phone 7 adoption, reports have circulated that says that Intel was caught off guard, but remains committed to the platform. Even if this is the case, it’s still questionable if MeeGo can gain traction if there isn’t a major hardware partner backing the platform. For now, most phone-makers are either developing their own OSes–as in the case of HP/Palm and Research in Motion–or are going with either Windows Phone 7 or Android. Where does MeeGo fit into the equation? Perhaps the better question is if the smartphone war will be a three-horse race? As it stands, it seems to be a two-horse race between iOS and Android moving forward unless RIM can change its luck and make the BlackBerry OS more competitive. For MeeGo, webOS, or Windows Phone 7 to be disruptive, there has to be a lot of compelling reasons for manufacturers to adopt the platform.
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