Nokia and Microsoft Deal for Mobile Entertainment

Nokia will use the new Microsoft protection software in order to encourage the use of multimedia using wireless networks, respectively will purchase the license for the PlayReady technology and will include it in the S60 software, the most used platform in the mobile industry.

The Microsoft technology allows sharing protected content, such as music, games, or video materials between mobile phones, computers and other devices.

The S60 software from Nokia is used on a large scale in the companies products, but also in the mobile phones manufactured by LG Electronics and Samsung Electronics. The only rival program that Nokia fears is Windows Mobile, developed by Microsoft.In 2005, the two companies signed a deal for installing Windows Media Player on Nokia phones.

As the price of the mobile phones decrease daily, the dealers search for a way to obtain profit from the use of the software applications, while Microsoft is searching for new profit sources from the mobile market.

In June, Nokia spokesmen mentioned that the company will reorganize its whole activity, and will focus more on software and services. Nokia claims that they expect a lot of S60 devices, and S40 ones included in the deal that use the PlayReady technology to reach the market in 2008.

The companies say that this deal could determine a growth in the demand for entertainment on mobile phones. According to Informa, a research company, the entertainment services - games, music, television, adult content and gambling - will reach the sum of 38 billion dollars until 2011, from 18,8 billion dollars in 2006. Until now, music was the only entertainment service offered by the mobile phones, but it is expected that the new market growth to direct itself on offering mobile television.

Microsoft and Nokia said that they will work together to allow clients to access digital content by using mobile phones and devices, and also, Nokia could launch in the next months an on-line music store designed for mobile phones, as a rival to the well known iTunes using the PlayReady technology.

Sebastian Nystrom, the head technician at Nokia refused to make any comments on the impact that this deal will have, but said that "PlayReady will be the main component that will be used for offering such services".