Published as part of our sister-site GamesIndustry.biz's widely-read weekly newsletter, the GamesIndustry.biz Editorial, is a weekly dissection of an issue weighing on the minds of the people at the top of the games business. It appears on Eurogamer after it goes out to GI.biz newsletter subscribers.
Nokia's decision to abandon its own smartphone software development in favour of creating new devices for Microsoft's Windows Phone 7 platform was widely trailed by rumour sites, but still managed to come as something of a shock to the mobile world.
Few people outside of Nokia and its loyal developer community were under any illusions about just how seriously the firm was lagging behind newer, more nimble rivals in the upper end of the market, but it was still extraordinary to watch a company which had been utterly dominant in this sector a few years ago effectively admitting defeat and starting again in respect to a huge part of its business.
For observers on the gaming side of the fence, this newfound alignment between Microsoft and Nokia essentially signifies the drawing of a new battle line in the rapidly expanding mobile gaming space. In the red corner, Apple's iOS devices. In the blue corner, Google's Android and the newly revealed PlayStation Suite service from Sony - and in this week's new corner (green, perhaps?) we find Microsoft's Windows Phone 7 and former mobile device champion Nokia.
Why is this significant? The obvious answer is that it's significant because smartphones are rapidly on their path to becoming among the most ubiquitous and popular gaming platforms on the planet. The pace of their evolution vastly outstrips traditional gaming devices, as does the range of their appeal, while their openness delivers nimble, aggressive business models and pricing that the traditional players are struggling to match.
The company that ends up dominating high-end mobile - assuming that any one company or platform does - will become the de facto platform holder for a fairly major chunk of the interactive entertainment business.
On a more short-term basis, though, the Nokia alliance neatly stitches together some questions which have floated over Microsoft's whole position in the mobile market. Up until now, the company has enjoyed little other than a string of failures in mobile - some noble, some rather less so. Despite persistent rumours, it has avoided matching its console rivals by launching an "Xboy" handheld system, instead focusing its efforts on Windows Mobile and, latterly, Zune, neither of which have enjoyed any serious market traction.
The battle between Sony and Nintendo over the handheld space was always one Microsoft could afford to remain aloof from while it focused its resources on establishing a strong foothold in the home console market. But the combined threat of Apple, Google and now Sony in the mobile space - including the rapidly growing mobile gaming aspect - could not be ignored so blithely.
Windows Phone 7 is the company's response, and it's a competent and attractive mobile operating system. A little form-over-function for some tastes, perhaps, but definitely a contender for market share against Android and iOS.
Just one problem - it utterly lacks the kind of device support which would give it a proper chance in the market. While HTC, a manufacturer whose star is definitely in the ascendant, has adopted WP7 on some devices, much of the company's focus remains firmly on Android. Samsung, the other main supporter of WP7, also does Android devices and is something of a bit player in the mobile market anyway.
This is especially important from a gaming perspective, because although it remains a million miles away from the inflated budgets of console game development, mobile development costs have definitely risen in the past couple of years - especially at the upper end of the spectrum.
The nature of the market means that developers are extremely unlikely to target multiple platforms from the outset, choosing instead to release on the dominant platforms before porting to less popular platforms if the demand proves itself. Right now, that means that the bulk of games hit iOS first, and many of them actually stay there, never being ported out to Android.
The growing success of Android will probably change that - but without pulling out the world's biggest money-hat, it was hard to see how Microsoft was going to populate WP7's software line-up with anything rivalling those of its rivals.