Nokia goes head to head with Apple, says Analysys

LONDON, UK: Nokia has laid down the gauntlet to the industry with the clear objective of being the service of choice for consumers looking to organise and get access to their social network and content from both the mobile and PC, says Analysys.

Mike Grant, Head of Broadband and Media at Analysys, who attended Nokia World 2007, Nokia's three-day conference in Amsterdam, said senior management at Nokia have outlined two major initiatives that accelerate the move by Nokia from being a pure device play into an integrated end to end consumer service organisation in the mould of Apple.

The first is the introduction of Nokia's "Comes with Music", a service offering buyers of certain Nokia devices 12 months free unlimited access to the Nokia music catalogue, which Grant says is a clear nod from the manufacturer to Apple for its success in integrating music with mobile communications.

Nokia's first partner in rolling out this service will be Universal Music International, who will offer access to their entire catalogue to Nokia customers outside of the US. During the 12-month initial service period, users will be able to download and store for as long as they wish as many tracks as they want from the catalog. After 12 months, the user can continue to gain access to the service, but will have to pay a subscription. However, the tracks they have downloaded during the initial 12 months will remain theirs to own regardless of whether they continue to pay for the service.

"Clearly Nokia expects that users will find free music for a year a compelling alternative to iTunes on the Phone," says Grant.

More significantly, Nokia has also announced further details of the expansion of the Nokia Ovi service into the Internet and PC worlds. Ovi currently provides users with access to music, games, social networking, content sharing, and mapping services through an on device WAP portal.

Going forward, Ovi.com will provide users with easy access to all their content and the Ovi storefront through a personalised "dashboard" or Web based portal. This portal will also provide easy integration with on device data such as synchronised contact lists. In short, the service looks very similar to Apples current .mac service.

In addition, Nokia have announced the development of a PC version of the Ovi dashboard providing again integrated access to the same services and personal content. Indeed, initial screen shots of the beta application give the impression of a user desktop that bears a remarkable resemblance to the desktop environments from Windows or Mac. Both Ovi.com and the PC Dashboard are in internal beta right now and will enter public beta next year.

"These moves are a clear statement that Nokia intends to compete head to head with Apple and others seeking to be consumer's default personal information and entertainment destination," says Grant. "As users increasingly build lives around their mobiles, taking pictures, listening to music, and maintaining and interacting with networks of friends and work colleagues, equality of access to content and data across mobile phones, PCs or another internet terminal is becoming increasingly important. Previously, only those who bought into Apple's .mac vision (some would say religion) could indulge in such luxury. Very shortly users will have a choice and that choice will include Nokia Ovi."

Grant adds: "The implications for operators and other OEMs are significant. Should Nokia successfully execute these developments and attract even a small proportion of their current 1 billion customers to this service, both operators and other OEMs will have a mountain to climb to offer the same compelling proposition. Nokia is laying down the gauntlet, saying effectively that Apple have got it right, and they intend to compete for consumer loyalty across mobile, PC, and the Internet. Moreover, while Apple have a strong presence in the US, Nokia's global market reach and scale make it a powerful competitor to all in this space."

"Nokia talks about partnering with operators to deliver the Ovi proposition and expresses the hope that other Series 60 licensees, such as LG and Samsung, will also offer Ovi to their customers. However, without the financial muscle and global reach that Nokia has in this space, it is hard to see any other player delivering a similar proposition," continues Grant.

"With this announcement, Nokia have stepped out ahead of the rest of the industry in bridging the divide between mobility and the Internet. Successful execution appears to be their one remaining challenge. We shall watch the company's progress in 2008 with interest."