Microsoft Officially Owns Nokia's Smartphone Division

I didn’t quite call this one: I honestly expected Microsoft would pick up BlackBerry. But, in a move that’s surprising in how bold it is, Microsoft has bought Nokia, and is now, officially, in the business of making smartphones.

Technically, Microsoft didn’t buy all of Nokia, just Nokia’s Devices and Services division. But since Nokia is mostly known for making smartphones and providing them with services, essentially they’ve bought the whole shebang, as far as the man on the street is concerned. But why?

The short answer is that it’s the only way Microsoft can compete. They have to make their own phones or give up entirely on mobile, and that last is not an option if the company wants to survive, long-term.

Nokia bet the entire business on Windows Phone, and to be honest, it was easy to see why. Windows Phone is actually a great phone OS; intuitive, easy to use, fairly smartly designed. The problem is that Apple has all the street cred and Android is free to use, so outside of Nokia, response to Windows Phone has mostly been “Eh, OK, we guess we’ll make a phone for this.”

There’s a lot of hubbub about how Samsung and HTC won’t make a decent phone for Windows Phone now, but realistically, they weren’t making decent phones anyway. When was the last time you saw somebody using a Samsung Focus? This lets Microsoft’s “hardware partners” exit an OS they didn’t care about or use gracefully, and lets Microsoft focus on actually making phones people might buy.

That’s a hard road, however. Apple and Google have many, many people invested in their ecosystems, and Google in particular is a tough customer. Google will put superphones in cereal boxes; it doesn’t care, it just needs your eyeballs to keep looking at ads. Apple locked in a lot of customers a decade ago with iTunes. Microsoft still has that one guy with the Zune and your parents.

In other words, we wish them luck, but they’re going to have to work hard to create something that can rival the two biggest names in the field. But at least now they won’t have bad handsets holding them back.