Linked by Thom Holwerda on Tue 24th Sep 2013 11:44 UTC
PDAs, Cellphones, Wireless

Finland is boiling with rage this weekend over the $25 M bonus payment the CEO Stephen Elop is set to receive as he leaves Nokia after his two-year tenure. Questions are now being raised by the oddest aspect of the bonus: the board of Nokia seems to have given Elop a $25 M incentive to sell the handset unit cheaply to Microsoft way back in in 2010. This effectively means that the board hired a man who was given a giant carrot to drive down Nokia's overall valuation and phone volumes while preparing a sale to Microsoft. What could possibly be a reason to structure Elop's original contract in this manner? Did the board in fact end up promising Elop more compensation in case he sells the phone division than if he runs it with modest success?

Vindication. We were right all along.

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RE[3]: Comment by Nelson
by dsmogor on Tue 24th Sep 2013 16:47 UTC in reply to "RE[2]: Comment by Nelson"
dsmogor
Member since:
2005-09-01

Using your logic, Nokia shareholders would get much better off if Nokia had simply offered Samsung a takeover/merger deal in 2010/2011, than struggling alone with WP mission, after most MS partners have left the building.
Not to mention that MeeGo was much more featurefull than WP at that time and some Nokia signature features got supported only on subset of Lumias, 2+ years later.
Recall it was in hugely dominant position by then, (all of which was ruined during Elop's tenure) and any smartphone contenter would have happily paid 10x current price just to get its market share.
And no, it's not Nokia that dropped the ball here. It made everything to make WP/Lumia successful:
- put it in award winning design
- followed on with HW innovation in screen and photo departments
- put all the weight of its brand (still strong in many parts of the world) behind it despite WP missing signature features
- ditched all of it's native production capability to align with WP limitations
- agreed to lower ASP and profitability to offer wide pricing levels despite WP limitations

It's really not Nokia hw design fault that its WP devices have failed to gain traction.

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