Why Nokia is toast

“Nokia now finds itself standing on a ‘burning platform,’ according to CEO Stephen Elop. Other clichés might apply. ‘Sinking ship’ comes to mind.,” Mike Elgan writes for Computerworld.

“Apple and Google are winning because they have winning strategies,” Elgan writes. “Nokia is losing because it has a losing strategy. It’s as simple as that.”

“Nokia and Microsoft this week announced a sweeping new partnership that would replace the Symbian OS with Microsoft’s Windows Phone 7 as the software for Nokia’s smartphones,” Elgan writes, “Nokia’s stock price tanked, and hundreds of employees stormed out Friday in protest of the Microsoft deal. They no doubt suspect, rightly, that the deal will involve sweeping layoffs.”

Elgan writes, “My view is that Microsoft doesn’t matter. Although Windows Phone 7 is a way better operating system than Symbian, Nokia’s problem isn’t Symbian, and the solution isn’t Windows Phone 7.”

Much more in the full article – recommended – here.

MacDailyNews Take: Former Microsoftie Elop went with the devil he knew; a common mistake.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

47 Comments

  1. “Apple and Google are winning because they have winning strategies,” Elgan writes. “Nokia is losing because it has a losing strategy. ”

    You’ve not really said anything here except… repeated the words winning and losing, respectively. You’ve explained nothing.

    “It’s as simple as that”

    Actually it’s not. It’s much much much more complex than that, since, you haven’t explained a thing.

    1. Um, did you read the article? You know, the article that has “much more” and is “recommended”? The one that’s three pages long? You might be surprised to find that he does explain it. In considerable detail.

      Or you could just spew off based on MDN’s summary and look like an ass. That works too.

      ——RM

    2. Well. I’m a Finn but never wanted a Nokia phone.
      I’m an Apple fan, but dont want an iPhone. It’s a nice piece, but not for me.
      Sony Ericsson my brand as long I can use a phone without any Microsoft software.
      Apple and Google is showing the path.
      Now if Apple does a cheap phone it’s gone with Nokia and M$. They can never cope with that.
      Android is then the real rival left.

      1. Why not an iPhone ? price ? or size ? or, no reason ? please explain. yes the Android is nice, oh i see, maybe you want an open system :), yes it’s REALLY nice in that case 🙂

        the iPhone is the best phone, but the users and developers are not free, i understand why, but the reasons are bad, it’s all about making profit with the App Store, a bad decision because it’s only generating a very small part of Apple’s revenue.

        1. I’ll explain. I do a lot of outdoor tasks, fix cars in my garage etc. and phone always in my pocket. So it might be the size and that iPhone got so much glass on it. I’m sure it would brake down in no time.

          Not saying iPhone is bad or anything else like that 🙂 It’s a masterpiece.

          A smaller iPhone or some other one made by Apple, who knows if I would get one 🙂

          Only good thing is that Apple now got a chance to toast both Nokia and M$ 🙂

  2. Nokia is just proving how desperate it really is. I’m all for new and competing platforms, including Android (despite some of their dick moves these days), but using Windows is a bad move.

    I think I’m one of the few that hopes the new OS landscape is iOS, Android, and WebOS (and a GOOD F#@KING RIDDANCE to Microsoft’s relevance).

  3. Nokia is an ostrich with its head stuck up it’s ass. Companies that refuse to acknowledge new realities and trends in the technologies they depend on (like Sony,Microsoft,Dell,Nokia,Palm, etc…) do so at their own peril in a digital economy where being able to change on a dime and reinvent oneself is essential…

    All these companies are so stuck in a culture of conceit and arrogance that they underscore by trashing real innovators like Apple. This trash talk and arrogance, only serves to illustrate their their egotistical insecure idiot CEOs that put them to ridicule, obscelecence and irrelevance.

    Nokia has been in denial since Apple introduced the iPhone and went out of their way to make fun of how “cute” it was and ignore it completely…

    Ollie, what’s his name, basically destroyed Nokia’s dynasty and screwed the whole economy of Finland as a result… Welcome to the whipping post Jokia.

  4. There is no Google OS, each brand of OS is customized to the individual phone makers brand. iOS is comparable only to each individual phone maker and their OS. Rather than Android being fragmented, it actually doesn’t exist without being customized by the individual phone maker. Google gives away the brains of the OS and every phone maker builds the rest of the body, altering the OS to make it to their liking. This makes HTC android, quite different from Motorola Android. This is very different than Windows being adapted by all PC makers, but Microsoft determined the whole cloth of the OS, with add-ons making minor distinctions. I wonder what this comparison would tell us. We already know who makes the most dough. It is also important to compare sold units to sold units. Whining that we are only able to see data on units shipped is bullshit. Each company knows exactly how many units are sold. Time to compare Apples to Apples (imitators).

    1. What he’s saying is ” – here are the places we make money… Bing, Office, Xbox… see how our money-making things are going to have their own mobile platform now, thanks to the company that has in the past sold the most phones?”

      A fairly simple ‘synergy’ gamble, and of course, as we know, Mr. Ballmer didn’t get the “stop using ‘synergy’, it’s totally a punchline now” memo that other upper management brass seem to have finally started circulating.
      Now, they might have a brilliant plan. For this to be a brilliant plan, three things would need to be true.
      Thing 1 is that Nokia would have to be able to design and manufacture a really amazing phone. Ask yourself if you think that is possible.
      Thing 2 is that MS would have to be able to design and maintain a robust, scaleable mobile architecture that supported a rich development community.
      Thing 3 is that they would have to be able to work very closely with each other and play nice.

      Well… we’ll see about that. We’ve only got a few Nokia workers walk off the job to go by right now. But come on. A Microsoft guy takes the helm of your company. Your platform is ‘burning’. “Yeah, screw this day, we’re goin for glogi.”

      What this really means, in my opinion, is that MS has a full share hardware partner, and therefore the only one that will survive in the near term. Oh no moto.

  5. For M$ it’s a win-win situation. They have a manufacturer who will be stuck with the platform and pay the licensing fees. Plus they get a well known manufacturer to put their platform out amongst the carriers.

    For Nokia it’s a big risk. The platform is shaky and poor designed. They are going to have to retool and rely on M$ for support and development. A huge mistake.

    Nokia will implode as a result. Sales will be poor and it will cut their profit margins even further. M$ of course will write of the losses because of their windows and office cash cows.

  6. Elgan’s record of analysis is poor, 40% hits, and 60% misses. Simple as that.

    I think Nokia has a chance if it executes quickly, meaning, they’ve been running WP7 on their prototype N9 in the lab for the last 5 months ever since Elop took over. Then on Monday at the Mobile World Congress, he does a keynote address where he pulls it out and demos it, and says it will ship by May. That would be Jobsian.

    Carriers want a 3rd choice, iOS, Android and something. Right now, noone knows who that 3rd choice is going to be. Is it RIM’s QNX? Is it HP’s WebOS? Is it the NoWin phone? Becoming that 3rd choice would be a big deal for Nokia and Microsoft, because developers will then develop for it, and carriers would carry it, and it would buy Nokia time to actually develop Meego if it becomes obvious that success requires an integrated approach shown by iOS, Blackberry, HP, Bada, etc.

  7. Nokia should make simple phones – thats what they are good at.
    They think they have to make some complex ‘smart’ phone, but that isnt the only market.
    Because they are all freaking out at Apples huge profits, they cant see that there is room for other kinds of phones.

    They will be reduced to a small office in Sweden and a guy calling China to tell them how many phones to manufacture and ship, with crappy software being delivered from Redmond.

    Of course, Nokia is heading for a big fall, probably being eaten by another co., and that will be the fat lady singing for the people who work there.
    Any group who hires that Dolt Elop deserves what they get, but I feel sorry for the workers.

    Although its fun to laugh at Nokia and M$oft (because they really are such Dolts), its a serious matter when a big company lays off employees because of the Dolts in charge.

    Manufacturing in China is destroying our western societies, and no-one seems to care.

    Apple is part of this job-loss offshore-manufacturing tragedy, too.

    At the risk of redundancy, two small Villages are missing their Idiots – Elop and Ballmer.

  8. what do you he went with the devil he knew? this was predetermined in my opinion. this is the way msft does corporate raids. Do you really think the investment bankers are not part of this charade?

  9. Actually I believe Windows Phone 7 now has a future. So much so I and a large number of my friends have just downloaded the new tools for creating Windows Phone 7 applications. So far it looks really good compared to the crap from Google.

    The free video tutorials are fantastic for absolute beginners to C#.
    http://channel9.msdn.com/Series/Windows-Phone-7-Development-for-Absolute-Beginners/Installing-Visual-Studio-2010-Express-for-Windows-Phone

    It wasn’t worth the effort unless I knew there would be a market like Apple’s, but this will put WP7 on the map of almost any consumer in short order. Nokia is the world’s largest phone manufacturer.

    It is telling that they considered Android and rejected it along with their version of Linux. I agree with the reasons given as they make strong business sense. Any other non Apple manufacturer may quickly follow their lead for the exact same reasons.

    Many may have missed that yesterday for a variety of reasons may been a killing blow for fragmented Android which is now forked into three parts and Google’s hopes of dominating the mobile web.

    .

  10. Let’s see…sailors on a sinking ship see another sinking ship nearby. They jump in their life boats and row to the other sinking ship. After reaching the deck of the sinking ship, they sink their life boats. Now that’s what I call a unique strategy.

  11. So this is what happens when you jam moldy, stale tech that is half-baked down the throat of consumers?

    Butter luck next time (and put your Waterford stemware down, it’s not that kind of ‘toast’…)

  12. OMG not again!!
    I worked for Sendo for a couple of years having moved from Phillips and we had a good OS – Stinger, at least it was in those days. Sendo entered into a partnership with MS to supply code which was to become Smartphone 2002. Within 18 months with no code delivered by MS and our IP used by MS for early WM 2003 the company was finished and we ended up being sued by MS for contract violation!
    Embrace, Extend, Extinguish
    I can’t believe someone at Nokia didn’t see this coming!
    On a happier note, I now dev for iOS tho’ I feel deep sympathy for the guys in Espoo and my mates in London who have been right royally shafted.

  13. It’s a good article. This guy “gets” that Apple actively limits consumer choices, and that leads to increased sales and customer satisfaction. Everyone else seems to think “more choice” is always better.

    However, there is one problem to his advice at the end, where he explains what Nokia should do, now that the Microsoft partnership decision has been made. I like the part about the “non-smart” phone (make ONE tiny phone that is great at just making phone calls). But “following Apple’s strategy” will not work with Windows Phone 7 as the platform…

    Nokia is not the only Microsoft partner for Windows Phone 7. If anything, this partnership makes Windows Phone 7 more “legit” and increase the number of Microsoft smart phone partners. Therefore, by the time Nokia releases its Windows Phone 7 device, the other partners will be releasing their second gen Windows Phone 7 products. And they will range from “super phones” to commodity phones. Nokia’s entry will be one of many choices. You canNOT effectively use Apple’s strategy when you don’t control the choices.

  14. This has to be the biggest bunch of misinformed people on the planet!
    Nokia has already released photos of their new Windows Mobile 7 phones. They compare nicely with the sleek design of the iPhone 3GS including the slightly curved back.

    They come in a wide array of colors which should appeal to the masses. They were already in production before the announcement.

    That simple bit of information invalidates almost half of the comments seen in this thread.

    Nokia is in this to make money, not make rabble rousing announcements.

    http://channel9.msdn.com/Series/Windows-Phone-7-Development-for-Absolute-Beginners?page=1

    1. I believe those “photos” where Photoshop’ed concepts, not actual working phones. And I doubt that any are actually “in production.” The only Windows Phone 7 phones that are in production are from Nokia’s future competition, which Nokia just boosted by making Windows Phone 7 a potentially stronger platform. Watch, it will be this time next year (at the earliest), announced at CES 2012, before Nokia releases its first Windows Phone 7 product; that’s why they outline an elaborate transition plan, where Symbian and MeeGo still exists.

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