Nokia vs. Yahoo smackdown!

Yahoo bought the photo sharing service Flickr in 2005. This morning came the news that Nokia bought Twango, founded by Microsoft refugees in Redmond. Telecom blogger Om Malik calls Twang “a combo of YouTube, Flickr, Shutterfly, Photobucket and Xdrive.”

There are some odd aspects to this. #1 of course is that Nokia supports Flickr on its phones, and in fact Flickr made Nokia S60 phones the centerpiece of its ZoneTag location-aware photo sharing prototype (including a very recent update to support some S60 3rd Edition phones).

The 2nd odd thing is that Nokia is buying a content sharing service, when its biggest customers are mobile phone operators that see themselves as being in the content service business. Does this presage a broader push into consumer services — head to head with the operators as well as Internet behemoths like Google and Yahoo? I realize Nokia expects to be beholden to no one, but in Strategy 101 we teach that moving outside one’s competencies and competing with major customers are two very bad (and common) outcomes of vertical integration.

Caroline McCarthy of CNET says it best:

It's unlikely that this acquisition will affect a whole lot of people who aren't Nokia customers (and it's not yet very clear as to how Twango itself will change) but it'll be interesting to see how this affects mobile media-sharing.

Technorati Tags: diversification, Nokia, social networking, vertical integration, Yahoo