What do Microsoft and Nokia have to offer each other in Windows Phone 7 deal?

I don't think anyone was really surprised by today's news that Nokia and Microsoft have joined forces. While the video of the announcement doesn't exactly inspire confidence, I'm willing to be a little more optimistic (at least for the moment) than Chris Nerney, one of my fellow bloggers here at ITWorld .

The reasons that I'm not immediately writing the partnership off is that despite not having gained huge traction in the market, Windows Phone 7 does have a lot to offer. It can be considered, in fact, to be the only truly innovative product to come out of Redmond in years.

The platform set a new bar in terms of instant access to current information through its tile-based Start screen and its lock screen. You can easily view notifications, see upcoming appointments, review messages and emails, and keep on top of your social networks. To me, the UI set a new bar for home screen interfaces.

The platform also took a unique page for both the home screen and certain app screens by not linking the physical and logical screen sizes. An app's screen contents can extend beyond the physical screen allowing the user to swipe to see additional content. It's not a new concept, but it is well executed and built into the OS more than on other mobile platforms. That offers a lot of potential for developers to do some cool things.

Despite these innovations and a deep integration with social media and other technologies like Xbox Live and the Zune marketplace, the device hasn't caught on. I recently talked about some of the reasons for that (and reiterated my belief that Windows Phone 7 would make a great tablet OS, far better than trying shoehorn Windows 7 onto a touch-based device).

Nokia does have some important things to bring to the table to help Windows Phone 7 succeed. Nokia is a global brand and generally makes very solid hardware. Although not thought of so highly in the U.S. these days, Nokia still has some brand value abroad, particularly in Europe. That could pump up interest in WP7.

The company is also planning to bring its development resources to help improve the limited app selection available for Windows Phone 7. This sounds good and Nokia does have a base of developers for Symbian and MeeGo (both of which are largely dead in the water as mobile platforms after today's announcement despite Nokia's claim that it will ship a MeeGo device, which may be a tablet). The trick will be getting those developers on board with WP7. Nokia can probably convince some of them, but many are likely to feel burned by the Finnish company (particularly those that were working on MeeGo).

More importantly, Nokia will be bring its in-house development team to WP7. That could be huge for helping Microsoft build the platform beyond its current state, which is clearly still a very new product in need of refinement (anyone else wondering where that update that includes things like copy and paste is?). Nokia's team can help both with the platform as a whole as well as with developing a broader range of apps.

Nokia's development aid, however, may backfire somewhat on Microsoft since the company has been given permission to customize WP7 on its hardware to differentiate it from the devices available from other manufacturers. Microsoft was very clear that it wanted to maintain control and a uniform look and feel across all devices to avoid any of the platform fragmentation issues that have cropped up around Android's completely open approach. Existing manufacturers are not likely to be happy with a single new company being able to modify the interface when they are not.

Nokia also has extensive relationships with carriers in virtually every global market. That is a huge resource to bring to the table. The two companies can leverage those relationships to ensure that Windows Phone 7 gets more attention and consideration by carriers and thus by consumers.

So, Nokia has a lot to offer Microsoft, but does the Finnish company stand to gain a lot from this partnership? That's a murkier question and one that hinges on how successful Windows Phone 7 eventually becomes. If the platform succeeds and manages to snare market share from Android, iOS, and BlackBerry, Nokia could reap some rewards. Even if the success is modest or based around non-Nokia devices, the company might gain from its development involvement with the platform (hard to say not knowing the terms of the deal).

It seems clear, however, that for Nokia to turn itself around its vision of Windows Phone 7 must be successful. That means that despite what Nokia has to offer Microsoft, the company is somewhat on its own to succeed or fail. That may look bleak, but partnering with Microsoft may have some positive effects beyond explicit resources provided to Nokia.

European mobile carriers have been concerned about the growing control Apple and Google are having in their markets. They were actually in favor of the idea of Nokia producing WP7 devices as it ensures more smartphone diversity. This could translate into a stronger push of Windows Phone 7 in Europe, one of Nokia's past strongholds.

Overall, I think this move helps Microsoft more than it does Nokia. I think Nokia had to find a partner and decided Microsoft was the best option available, which may have allowed Microsoft to get the better end of the stick out of this deal. That said, I do think it has potential for both companies. Since I also think Windows Phone 7 has some solid potential, I find it slightly encouraging that the platform might develop and expand better with Nokia's involvement.

Ryan Faas writes about personal technology for ITworld. Learn more about Faas' published works and training and consulting services at www.ryanfaas.com. Follow him on Twitter @ryanfaas.