Light Reading

Nokia on the Road to Hell?

Sarah Reedy
5/7/2013
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Nokia shareholders are politely asking the Windows Phone maker to pick a new path, not the road to hell it's currently on.

On Tuesday, shareholder Hannu Virtanen told the hell-bound company's CEO Stephen Elop, "You're a nice guy ... and the leadership team is doing its best, but clearly, it's not enough," according to Reuters. He then asked, "Are you aware that results are what matter? The road to hell is paved with good intentions. Please switch to another road."

I think Elop is well aware of the importance of results, but I have to admit that it's easy to wonder if he's lost his way. I was thinking the other day that I hadn't heard a peep from Nokia in quite some time when I saw Microsoft's latest Lumia 920 commercial making fun of the fanboy war between Apple and Samsung. The problem was that I didn't realize it was a Lumia commercial until the very end. All the attention was on Apple and Android.

That's how the market is, too. It seems that Nokia's big Windows Phone push hasn't really been that big at all. The Finnish company sold 5.6 million Lumia handsets in its first quarter, up from 4.4 million in the previous quarter, but only giving it 5 percent market share. (See Euronews: Nokia Devices Still on the Slide.)

The problem is, it's going to be quite hard to "switch to another road" at this point. I do think Nokia is smart to stay on the sidelines of the Apple and Android fight, but it has to find its niche elsewhere. Crawling back to Android is a lost cause -- it's too little, too late. At this point, its options may be to either focus on taking down BlackBerry, a tricky proposition given their relative enterprise offerings, or to become the champion of the cheap phone.

If it can capture the first-time buyers and emerging markets, where it already has inroads, Nokia may have a chance of escaping purgatory. It seems to realize this, as it's holding an event in India on Thursday where it will unveil a low-cost smartphone targeted at emerging markets. It also just appointed a new general manager for China, Erik Bertman, who takes over June 1.

At the same time, Nokia is not giving up on the high end. Its oft-rumored Lumia 928 is expected to come soon to Verizon. (See Nokia Flagship to Sail Onto Verizon in May?)

I don't know if the emerging markets will be enough to save Nokia, but just staying the course doesn't seem like the best move. I wouldn't be as dramatic as Virtanen to say Nokia is headed to hell, but things will certainly get heated where it's going.

— Sarah Reedy, Senior Editor, Light Reading

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lanbrown
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lanbrown,
User Rank: Moderator
5/14/2013 | 6:07:24 PM
re: Nokia on the Road to Hell?
WP was a sinking ship long before Nokia boarded. Nokia was seeing double digit growth with Symbian. 2010 showed a 34% increase over 2009; 134 million units compared to 100 million, so an increase of 34 million units. Nokia is not even selling 34 million Lumia handsets a year. WP has been a failure and Nokia needs to move on before it is too late. If a 34% increase in sales is a burning platform; then what is WP? There is no hope for WP; there never was.
f133972
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f133972,
User Rank: Light Beer
5/9/2013 | 6:57:21 PM
re: Nokia on the Road to Hell?
Enough to save Nokia??? What??? That's a bit bold to say. Maybe you didn't realize it was a Lumia commercial until the end because that was the intent of the commercial...? You talk about market share, isn't that what the commercial is eluding to?
Are we going to make more speculations on the direction of Nokia with little injections here and there -- or can we at least give more "light" perhaps unbiased depth to the article? KK THX
lanbrown
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lanbrown,
User Rank: Moderator
5/9/2013 | 2:01:54 AM
re: Nokia on the Road to Hell?
Nokia wants to use some of its own products like their Map software, which is something Google doesn't like. Google doesn't need Nokia, Nokia needs Google though.

The strategy for Nokia is simple. They supposedly already convinced Microsoft to also support more than just Qualcomm chips. Of course, the company they picked is in the process of a de-merger. Microsoft does need to support more than just Qualcomm chips. Once that is done, then Nokia can start to compete with the likes of Samsung and HTC. Nokia can continue to sell WP but that also means they can easily support others. Sailfish will finally be available soon. Firefox will have an OS as will Ubuntu. If people buy the FaceBook phone, maybe Nokia could produce the next model. Nokia can succeed, they just canGÇÖt rely (trust) Microsoft to be the one to do it.
lanbrown
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lanbrown,
User Rank: Moderator
5/9/2013 | 2:01:30 AM
re: Nokia on the Road to Hell?
They did but the phones just do not sell. AT&T spent more on advertising on the Lumia 900 than they did the iPhone. Essentially they spent around $400 or so per phone to sell a $99 phone. AT&T didn't see an increase in customers, just a lot of money spent for nothing. For the $150 to $200 million they spent, they could have had a great promotion. Renew or sign-up for a new contract and you are entered in to win $1 million. Each day there would be a new winner and they could do that for six months. Guess what, they would have been farther ahead than jumping on-board the WP train wreck.

Look at WM, where did that end up? Microsoft abandoned it but that was long before the milked it. How about the Kin. That was followed by WP. Microsoft abandoned every WP customer out there with WP8. Up until WP8 handsets that couldn't run the next OS were still being sold. Great way to alienate your small customer base and inform potentials to stay away.
dineshk913
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dineshk913,
User Rank: Light Beer
5/8/2013 | 5:33:00 AM
re: Nokia on the Road to Hell?
Or they can virtualize the phone and allow either of OS work ! ...
vinod nanapan
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vinod nanapan,
User Rank: Light Beer
5/8/2013 | 12:47:22 AM
re: Nokia on the Road to Hell?
Android is Junk. iPhone is costly. Windows phone is moderately costly and better than iPhone. So choice is clear !!!!
Jeff Anttila
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Jeff Anttila,
User Rank: Light Beer
5/7/2013 | 11:54:26 PM
re: Nokia on the Road to Hell?
I'm Finn, and really want to see Nokia succeed, but Apple should be a use-case in "First Mover" or "First to market" advantage.

Even though Nokia had smartphones years before Apple did, Apple localized the software so developers could write the software once.

I remember on Nokia/Ericsson and their first Smartphone platform.
MordyK
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MordyK,
User Rank: Light Sabre
5/7/2013 | 10:51:07 PM
re: Nokia on the Road to Hell?
I don't see why they can't go the Android route at any time. AT the end of the day the only major difference between Android and Windows Phone are the apps and the interface, but Nokia can create a signature interface layer on top of Android (inspired by Symbian?) which is an area where they have a ton of experience and add some of their unique stuff such as Pureview. IMHO Its really just a question of marketing and dealing with an overlap of OS's which will also need an good migration app/tool to make it seamless for transitioning customers.
SarahReedy
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SarahReedy,
User Rank: Blogger
5/7/2013 | 10:17:47 PM
re: Nokia on the Road to Hell?
Do you think they could really adopt Android at this point and stand a chance against others like Samsung and HTC? It has stiff competition no matter what it does, but it seems like a tough road with Android too.
rgrutza600
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rgrutza600,
User Rank: Lightning
5/7/2013 | 9:03:21 PM
re: Nokia on the Road to Hell?
I forgot to add that Windows Phone 8 is the best smartphone OS on the market. I own two iphones, two androids and two windows phones...
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