Comments for 2008 Web Predictions

Yokia! Why Nokia Should Buy Yahoo

2008-02-07T20:08:00Z

Syndicated from last100, our digital lifestyle blog

Forget Microsoft, News Corp. or even Apple. Nokia, the world's no.1 mobile handset maker, should buy Yahoo. Or so says Information Week's Stephen Wellman, who puts forward a compelling argument: If Nokia is repositioning itself as a Web services company, to combat falling profit margins on its hardware, then acquiring Yahoo would help to give the company a much needed presence on the desktop (not just mobile), as well as beef up its Web offerings and Internet brand recognition in general.

]]> "Nokia is now a Web company, not just a handset maker. But, the company acts as if the Web is just mobile and has no desktop component. This isn't a very smart strategy", writes Wellman. All of Nokia's mobile web rivals: Google, Microsoft and, of course, Yahoo all have desktop products.

"These Web giants are leveraging their vast desktop Web audiences to grow their mobile initiatives. While Nokia has tons of mobile phone customers, it doesn't have as many Web application users", notes Wellman.

As well as gaining a presence on the desktop, a Yahoo acquisition would help Nokia to further develop its range of location-based services (building on its purchase of GPS company Navteq), again to fend off challenges from Google. Ditto mobile advertising. In addition, Yahoo would give Nokia an instant bump in its U.S. brand recognition. Despite claiming a 40% worldwide market share for mobile phones, Nokia doesn't compete nearly as well in North America.

Overall, however, a combined Yahoo/Nokia (Yokia!) would provide Google with a formidable competitor in the pending battle for the mobile web. This is, as ex-Microsoftee Robert Scoble likes to point out, the real reason why Microsoft is attempting an aggressive takeover of Yahoo.

Alternatively, a nightmare scenario exists for both Microsoft and Yahoo: Yahoo sells it ad business to Google in return for an ad-revenue partnership. Meanwhile, the Open Handset Alliance starts to produce real results and Google's Android becomes a widely adopted mobile OS. The result? Google dominates the mobile Web (i.e. mobile ads) as it does on the desktop.

What do you think? Should Nokia merge with Yahoo? And yes, before you ask, Nokia does have the cash.

This post is syndicated from last100, our digital lifestyle blog covering Internet TV, digital music, Mobile Web and more. You can subscribe to last100 here.

Comment from Stephen Wellman on 2008-02-07

2008-02-07T22:26:06Z

And the most obvious reason Nokia should buy Yahoo: Flickr.

http://www.informationweek.com/blog/main/archives/2008/02/flickr_the_bigg.html

Comment from MySchizoBuddy on 2008-02-07

2008-02-08T02:39:16Z

Nokia doesn't have the cash, it has only $9B in cash and short term investments.
http://finance.google.com/finance?fstype=bi&q=NYSE:NOK

Nokia's stock however is pretty good

Comment from kuldeep on 2008-02-08

2008-02-08T09:02:47Z

If you are considering Nokia as a option, then why not Apple....it would be much better and both can benefit heavily from this.

Comment from Emre Sokullu on 2008-02-08

2008-02-08T10:11:09Z

Steve, there is one thing I'm sure - they'll need to change their name before entering the Turkish market. It doesn't sound so good in Turkish :)

Great points btw...

Comment from davidlian on 2008-02-10

2008-02-11T02:55:23Z

But I'm wondering why Microsoft (with pretty decent web services) would need Yahoo! if not for users....and Flickr.

Would it be money better spent for them to buy out Motorola's ailing handset division?

Comment from A.T. on 2008-02-19

2008-02-19T19:00:54Z

oh, please, no - we don't need that Americana slack, we have enough own EU one.