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Buy Nokia and Microsoft, Not RIM or Sprint

Tickers in this article: MSFT NOK S RIMM

NEW YORK (TheStreet) -- When I make a prediction, I often tell people that I reserve the right to be wrong.

Unlike many folks in this business, I do not mind being wrong. As with all of life's endeavors I not only expect to miss frequently, but I welcome the occasion. Rarely, if ever, do I learn a whole lot when people are singing my praises and patting me on the back. In fact, I write better articles after being wrong because it creates a learning experience for all of us. I will never understand why some authors go into hiding after making an errant call.

That said, several instances exist where I disdain missing the mark.

At the top of the list? When I end up wrong because I followed the crowd, but never dug deeper or thought critically past the consensus.

For example, I have never gone with the crowd on Amazon.com(AMZN) . From the moment, Kindle Fire rumors surfaced, the entire world called it a competitive salvo tossed Apple's(AAPL) way. I knew better. And I still do. Developing a deeper understanding of Jeff Bezos' ways has helped make me a better investor.

Emerging stories versus dead money
One of my favorite publications, Slate, published an all-too-common example of blindly following the consensus:

The Lumia 900 smartphone that launched yesterday has the backstory of a summer blockbuster: Two aging veterans of the tech industry, Microsoft and Nokia, team up for one last caper ... Nokia's Lumia 900 is supposed to lead Windows into the mobile promised land and upend the rapidly emerging Apple/Google duopoly.

That's an incredibly thin, short-sighted and uninformed analysis of the situation.

The author followed that up by speaking of logistical blunders surrounding the launch of Nokia's(NOK) new phone on Easter Sunday. (That sort of thing has never happened to anybody else? Think Apple and China).

He concluded by arguing that " Microsoft(MSFT) can't subsidize hardware manufacturers to make Windows Phone products because Microsoft's whole business is selling operating systems to hardware makers."

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Fair point. Google's(GOOG) Android is open and free.

Surely, Microsoft executives never considered the conundrum the Slate scribe presents.

I have. And it leads me to one of two solutions (or a mix of both):

  • Give the mobile OS away for free.
  • Subsidize smartphone/tablet inclusion of Windows 8 by wheeling and dealing in other areas.

I expect point one to take precedence.

The Slate author should have done some research on Microsoft's history. Critics have claimed for ages that it was up against it and could never succeed. But for better or worse, Microsoft is bigger than the sum of all of our parts.