Sunnyvale, California — Web pioneer Yahoo Inc. and cell phone maker Nokia on Monday announced an alliance that will empower the Finnish phone giant providing map services to Yahoo customers on both PCs and mobile devices, while the Sunnyvale Internet company provides mail and chat services for Nokia customers around the world, seeking to regain market share lost to rivals like Apple Inc and Google Inc.
The deal, disclosed Monday in New York by Yahoo CEO Carol Bartz and Nokia CEO Olli-Pekka Kallasvuo, seeks to influence the strengths of both companies to compensate for the weaknesses of each. Nokia, the world’s leading mobile-phone manufacturer, would gain access to Yahoo’s world-leading base of e-mail subscribers, boosting Nokia’s presence in the U.S., where the Finnish company is struggling to compete with fast-growing smartphone platforms such as Apple’s iPhone and Google’s Android.
Beginning in the second half of this year, Yahoo will host Nokia’s Ovi email on phones exclusively and Nokia in turn will provide maps and navigation for Yahoo. They will be designated as “powered by Ovi,” Nokia’s Internet service brand. Nokia and Yahoo will also function on a federated ID that will enable users sign into Yahoo and Nokia services with the same login name.
CEOs Carol Bartz and Olli-Pekka Kallasvuo. (Credit: Nokia)
Nokia is the leading handset supplier in many emerging markets, but it has been battling to grow in North America. “We are clearly the leader in our industry, yet we do not lead in the biggest market in the world — the U.S.,” Kallasvuo told reporters in New York.
Nokia’s Kallasvuo said working more closely with Yahoo would help it compete in the United States. “This is one step we are taking to change that.”
“By employing Nokia’s map and Navteq services, it will be a much valuable experience for our users,” Bartz said. She said the alliance would help Yahoo build its audience in developing countries such as Indonesia, India and Thailand where the primary way many people access the Internet is through their phones.
“Many of you are aware that we have not focused a lot on our maps platform. This alliance changes that,” Bartz said. “By using Nokia’s maps … it will be a much richer experience for our users.”
Furthermore, Bartz also mentioned that Yahoo will continue to operate with other cell phone makers and will be incorporated into other smartphone operating systems. This suggests that Yahoo will still be on Research In Motion’s BlackBerry devices, Apple’s iPhone, and even Google Android devices.
Financial terms of the deal were not disclosed.