They had quite a run.To a very real degree the Finnish giant Nokia created the mobile phone market from nothing and for well more than a decade they reigned supreme over it. However the market Nokia created and Nokia has inexplicably refused to for years….until now. And now, the changes that have been unleashed in Nokia are looking more and more like bad choices and pure chaos as the 15th annual Nokia World begins tomorrow with the company with even less to show than last year…and everyone agreed last year’s Nokia World was dire.
Remember the devices that were the big reveals at last year’s Nokia World? The Maemo OS which is already dead and gone, the N900 which is already off the market and will mainly be remembered as the only device to ever natively run Maemo, and the Nokia Booklet, an overpriced netbook which may have been sold to one or two Nokia employees but that’s it.
So what has changed for Nokia over the last year? First and foremost the longtime CEO, Olli-Pekka Kallasvuo was shown the door after Nokia bled away 75 percent of its market cap over the last three years. He was replaced by 43-year-old Stephen Elop from Canada, the first non-Finn to head the company. He was headhunted from Microsoft where he headed the Microsoft Office division. Looking at his resume, I would say his biggest advantage in his new job is that he has long experience working with the Silicon Valley culture that has so confounded Nokia in the past.
However, in addition to the likelihood a Canadian head will fail to win the heart of his Finnish workers (or for that matter, a nation which supports Nokia like it was a football team, or their greatest claim to fame) he is also a logistics guy and a manager…when what Nokia really needs is an inspirational, product-design minded visionary. That is even more true today as the man who has been called the Jonathan Ive of Nokia, the smartphone evangelist with the big plans, Mobile Solutions head Anssi Vanjoki just resigned. It may be that he lost a bid to be CEO, or is casting a no-confidence vote against Elop in advance. It may be that he simply sees that the old order is changing at Nokia and feels he should change with it.
Either way, Nokia has lost its two most important decision makers in just two weeks and they have more or less nothing to display at Nokia World tomorrow. MeeGo, the OS that Nokia has said is the successor to Maemo and will be the key to their smartphone future (y’know, what they said Maemo would be last year) isn’t ready yet. That leaves them with the N8 to generate the smartphone heat for the faithful in London. However, the N8, while a sharp looking touchscreen phone, is running Symbian 3 which is not likely to cause Apple or Google much anxiety. It also isn’t likely to cause much excitement in either the gadget crowd or the mainstream.
Nokia became a powerhouse turning out endless versions of well-designed, powerful feature phones. They have tried to bring the same methodology to smartphones, but they have failed to understand the market. Even their newest flagship smartphone, the N8, is said to be defined by its excellent camera. If the camera is the main talking point you have for your new smartphone, you have a serious problem. How serious? Look at the following graph…
As you can see, according to Gartner Apple has been more or less stable, as has been Windows Mobile and to a lessor degree RIM. Nokia? In freefall. In fact, it appears that most of what Nokia is losing, Android is gaining. That is just going to get worse as more mid to low end Android phones are expected to flood the market over the next two quarters, striking deep at the territory Nokia still calls it own, low cost/low margin feature phones. The lack of available profit has been a big part of what has doomed Nokia and now even that looks likely to be taken away.
So…major event in two days. What does Nokia have to show?
- A new, outsider CEO with the wrong skillset (who is not supposed to actually attend anyway).
- The sudden resignation of their visionary Mobile Solutions leader with no replacement in sight.
- A smartphone that would have been competitive two years ago, but now is not likely to make a splash.
- Continued delays connected with their next-gen OS.
- A whole bunch of new, low profit feature phones.
Will the last carrier exec to leave Finland please turn out the light?