“We are navigating through a significant company transition in an industry environment that continues to evolve and shift quickly. Over the last year we have made progress on our new strategy, but we have faced greater than expected competitive challenges … We have a clear sense of urgency to move our strategy forward even faster … We are confident in our strategy and focused on responding urgently in the short term and creating value for our shareholders in the long term.” Stephen Elop, Nokia CEO after reporting a $1.8 billion loss for first three months of 2012.
For Nokia, I mean! Just when you think how much worse can it get, more bad news. Not that I am surprised and just shudder at the idea that what happened to Kodak could happen to Nokia.
7 thoughts on “Game over?”
Let’s nor forget Best Buy- agile is the new black
Nokia is definitely in trouble but it’s not clear yet if its headed for the same end as Kodak. The next few quarters will tell — if Nokia continues to lose $2B per quarter then (obviously!) it’s game over, but there’s two factors working in Nokia’s favor that could help turn the company around.
First, Nokia knows its in deep trouble and has been working to affect a turnaround, putting out its first Microsoft-based phones fairly quickly while maintaining good product quality.
Second, Nokia has allies in Microsoft and Verizon (https://plus.google.com/110836322558502335897/posts/7xjXQYBuda1), who are both depending on Nokia’s success to counter Apple and Google.
The question is if Nokia can ramp up revenues/profits from Windows Phone sales faster than its losses from the rest of its portfolio.
Now, why did we have the feeling that this won’t end well for Nokia? Captain of their destiny or Prisoner of their wishful thinking?
I guess my one main comment is to Elop’s assertion that, “…we have faced greater than expected competitive challenges.” REALLY?
I think the challenges are EXACTLY as you might have expected. Developers, carriers and consumers are all moving in one duopolistic direction: the tightly curated iPhone, and the loosely-coupled divergence of Android.
To get back into the game, Nokia has to target a different type of user, or be 10X better. At the present, they are neither.
The honest answer that Elop didn’t mutter is that they didn’t have a measuring stick before Lumia, but they do now, and they still come up short.
How they plan to rectify their current position, and whether they even have a cogent narrative as to why Nokia still matters is what Elop should have been talking about, IMHO.
The game is far from over. Initially mobile hand sets were dominated by Nokia mainly on ease of use / interface. Now the game has changed but is far from steady state. My sense is that Windows may be slow but they understand consumer applications and will get there. Together Nokia and Microsoft still have a chance as game of tablet / pads has just started and is not over. The way concept of screen will change over years is difficult to guess/estimate even for the best pundits of internet.
“To get back into the game, Nokia has to target a different type of user, or be 10X better. At the present, they are neither.”
They had a different type of user – the sort of user who wants superb photography on their phones – who wants flexible features such as open USB access. Who wants to bluetooth over a music file to someone else. Who wants their battery to last longer than a single day at best etc.
They alienated these people by moving to a poor man’s iOS – i.e. WP. The management did what the US technocracy thought it should do and now look at it…….
Comments are closed.