Nokia (s NOK) sells a lot of $50-$100 phones. In places like India, where I just returned from, Nokia’s ringtone is part of the urban soundscapes. It accounts for about 40 percent of total global handset sales. Much like McDonalds and Coca Cola, Nokia is everywhere. (Except in the U.S., but that is a whole different story.) Like those big, lumbering mature companies, it is unable to move nimbly.
It has yet to launch a credible touch screen phone to compete with LG, Samsung, HTC and every other handset maker. Simply put, Nokia facing innovator’s dilemma has become calcified with caution and is unable to invent markets. Instead of fighting off iPhone and other touchscreen phones, Nokia is thinking about selling laptops. Yes, you heard that right. Nokia will consider making PCs. Chief Executive Olli-Pekka Kallasvuo told Finnish national broadcaster YLE (via Reuters) that the company was looking at getting into the PC business.
Maybe it is Nokia’s way to handle competition from Lenovo, Asus and Acer. This is quite amusing because most of these PC makers redefine the word “loser” when it comes to making money. You might hear some analysts say that it is a good idea since mobile operators want to sell connected netbooks. I am not convinced that netbooks can be very profitable. If Nokia does indeed get into the PC business, it will be running and wheezing after more nimble competitors. You only have to look back at its failed attempts to sell underpowered tablets to know how this PC experiment is going to end.
What do you guys think about Nokia’s new likely diversification into laptops?