Ever since Stephen Elop became CEO of Nokia we knew this outcome was inevitable. It was his job to make it as easy as possible for Microsoft to acquire the vital parts of Nokia, and here we are: Microsoft is acquiring Nokia’s devices unit for 3.79 billion euro, and another 1.65 billion euro for its patents. It’s a bit of a complicated deal in that Microsoft buys the Asha feature phone brand and Lumia smartphone brand outright, but will only license the Nokia name for current Nokia products; the Nokia brand will remain under the control of Nokia the company. This means Nokia as a phone brand is effectively dead.
In addition, Stephen Elop will return to Microsoft. I’m sure entirely coincidentally, Ballmer announced recently that he’s stepping down.
All this was as inevitable as the tides rolling in. Nokia has been going downhill and has stagnated ever since the announcement it would bank its future on Windows Phone. It went from being the largest smartphone manufacturer to an also-ran, which is made painfully clear by the fact that Microsoft paid more for Skype than it does for Nokia’s devices unit.
A painful end for a once-great phone brand. This was the plan all along, and in essence, Nokia’s board has executed it masterfully; the Finnish company has switched core markets several times in its long, long history (it started out as a paper company), and the unprofitable phone business was a huge liability for the company, despite claims by some that Nokia was doing just fine. Nokia’s board has masterfully gotten rid of this money pit so it can focus on the parts that are profitable.
And, as always, the next Lumia will turn it all around.
Nokia is gone and RIM/BlackBerry may be next.
Not so long ago they were big names in mobile and it was hard to imagine them ever going down.
One day this will happen to Apple and Samsung too.
Nokia’s down is writing on the wall. Everyone knew that it will happen sooner than later. And blackberry too, of course.
Company that too arrogant and too full of itself will crumble faster.
Lets we monitor how blackberry doing
What irks me is so many saying “Elop killed it!” when in reality it was a total mess, infighting, poisoned culture, and it was dying by the time Elop was brought in. It would be similar to bringing somebody in to “save” your car while ignoring the fact that there has been flames shooting out from under the hood for the past 100 miles.
Nokia was ALREADY toast folks, the ONLY market where they had any real presence was dumbphones which by the time Elop was brought in was already like being the best 8-track player company in 1985. They had something like THREE different OSes, Maemo, Symbian, and the Java one whose name I can never remember, and we have had multiple guy post here that were working at the company in software who have reported it was a giant infighting mess over there and how NONE of their OSes were ready to compete head to head against iPhone and Android, so what EXACTLY did anybody expect him to do? And don’t say Android as Samsung and HTC would have curbstomped them, nobody does high end Android better.
If its any consolation it looks like Ballmer is gonna get the last laugh at the board, not only is he gonna spend billions of a dead company but he’ll probably get Elop in the big chair who’ll follow Ballmer’s “All we care about is overpriced cellphones and tablets, forget that billion dollar Windows business that is dying thanks to Win 8 hatred, have I mentioned we have an appstore?” and Elop will be able to save MSFT about as well as he saved Nokia. I wonder if in 2020 we’ll see some company buying MSFT for the patents?
Oh, come on: the “burning platform” memo was the worst failure in management and communication of the decade.
Nokia was mismanaged, but it had tons of opportunities and leverage. Some pruning would have done it; he chose to burn the whole tree. Maemo was in a better position than Windows Phone, and MSFT shamefully proved no better than Nokia at delivering updates and improvement.
The whole “Burning Platform” memo was completely ripped off from Chapter 6 of Daryl Conner’s “Managing at the Speed of Change” (ISBN 0-679-40684-0).
I think it’s totally unfair that Daryl Conner’s received nothing for the part he’s played. He at least deserves to be recognised as the inspiration behind the destruction.
Nokia’s stock price was once $40. Did Elop travel back in time and write a burning platform memo then too?
WHAT opportunities? Please list them because all I have heard is “Maemo and Linux” which you can read for yourself how much of a broken mess THAT was…
http://taskumuro.com/artikkelit/the-story-of-nokia-meego
At the end of the day you just have to look at where they were to realize they were doomed. the year is 2010, Apple has iPhone 2 which is a monster hit, Google has just released Froyo and will release gingerbread before the year is out, 2 OSes that are so well done they are still used even to this day by some OEMs, and finally you have the fact that not 6 months earlier you had a major Chinese chip designer (Loongson if memory serves) that had just shown their dumbphone SoC that would allow them to crank out a full phone for just THREE US DOLLARS, a number that Nokia had no way of matching.
So what did Nokia have? they had the TI OMAP, a BADLY out of date CPU they had not one, not two, but THREE OSes internally fighting for resources, none of which could compete with Android 1.x much less iPhone 2 and Android 2.x and they had a lead in dumbphones, a market which as i pointed out was about to have the bottom fall out and which had as much future as the 8-track.
Elop did the ONLY thing he could do, throw a Hail mary and hope to make up some ground and it failed, simple as that. There was NO other products in the pipe, NO other OS to fall back on, Maemo was broken and being sabotaged by Intel who feared the ARM version would eclipse the X86 version, there was no other road to travel, the board had waited too long to make the call.
You were likely thinking not of Loongson (they make ~desktop MIPS CPUs), but MediaTek:
http://en.wikipedia.org/wiki/MediaTek
…which have also nice dual sim Android SoCs.
And Nokia actually had four internal OS: apart from Meego and Symbian, also Series40 and Series30. And recently, again four: Windows Phone, Series40, Series30, and an OS in the Nokia 501 ( http://www.nokia.com/global/products/phone/asha501/ ) from Smarterphone; that’s how many Microsoft will carry on, at least for a while.
Bingo. Nokia was already in serious trouble when Elop came aboard: its Symbian platform was clapped out and ripe for mass cannibalization by the rapidly rising Android, and their own attempts to create a viable successor were a complete mess. It’s almost a mirror of 90’s Apple, where Elop was supposed to be Nokia’s Steve Jobs, sweeping in to save the day with fresh blood and clear direction.
Alas, as Radio says, he made one fatal newbie error by stating publicly what should’ve been kept utterly private, and causing such an instant and catastrophic run on stockholder and customer confidence that business schools will no teach it for decades to come.
It might seem incredible to bystanders that such a huge company could be brought so low by a few poorly chosen words. But, as pointed out, Nokia was already in an extremely vulnerable position, and Elop’s Osborning of its existing platform before its replacement was ready was the only nudge needed to set far larger and more destructive market forces in motion.
Simple mistake, simple outcome; nothing complicated or malicious needed to explain it.
By contrast, paranoid “Prison Planet”-level gibber like Thom’s own “It was Elop’s job to trash Nokia from the inside so MS could pick it up in a firesale” may play well to the anti-MS zealots, but is utter incredulous toss from any sort of real world business perspective. I may not be a great businessman, but even I can put my brain into gear and figure out why this argument is not credible:
1. A powerful, independent Nokia that successfully translated its then 50% market share to WinPhone in the first two years of Elop’s tenure would have been infinitely more valuable to MS than what they’re getting now: a handful of patents and a struggling 5% market share.
2. Imagine the legal and financial shitstorm that’d land on both MS and Nokia if there was even the slightest indication that Elop was intentionally sabotaging Nokia on MS’s behalf. Read the real press sometime: former CEO Jeffrey Skilling got 24 years for his part in bringing down Enron from the inside; even a lowly ex-network admin like Terry Childs received a $1.5 fine and four years in the big house for locking out San Francisco’s IT systems for a fortnight. What exactly does the resident peanut gallery think the law courts and stockholders would do to Elop were he discovered to be pulling the same shit?
3. Why on Earth would Elop, who has just landed the top job at one of the biggest technology companies in the world, choose 1. to be another CEO’s bitch when he’s now a CEO himself, and 2. risk huge fines and jail times in the process? I can only assume Thom et al studied at the Chewbacca School of Law and Business, because their ‘explanation’ makes absolutely no bloody sense whatsoever.
To use the old axiom: “Never ascribe to malice what may adequately be explained by stupidity.” I think that accurately describes Elop’s tenure, though Thom’s I am starting to wonder about…
Elop didn’t have to trash Nokia from the inside, Nokia itself was doing a pretty good job at that.
The only thing he needed to do is turning a company in freefall into a WP shop. Even if Nokia itself was sinking it’s assets would still remain valuable, and they could be obtainable a lot cheaper later on.
With Nokia 100% commited to WP it was just a matter of transfering ownership, as the migration to Microsoft’s ecosystem had already been done at Nokias own expense.
So I don’t think it was a sabotage, it was probably laid out clearly in front of the shareholders back when Elop was proposed as CEO:
“Your devices unit is irreversibly lost and it’ll only drag the whole company into bankruptcy, but you can get out of this mess and still get a decent profit by going WP exclusive and placing the devices unit in a desirable situation for an acquisition from Microsoft.
And in the meanwhile you’ll be getting a cash influx from MS to keep the company afloat.
Win-win, right?”
So presumably part of this fantasy deal you envisage also involves them saying that they’ll only complete the buy out it when it’s worth a fraction of what it is today?
I’m not buying it
Not really, rather than it would be adquired when it was aligned with Microsoft’s interests in the mobile market.
It just so happened that the value went down, but given their prior trend of mismanagement it could have gone down anyway with no expectations of selling it until it was worth pennies, and without the few billions they got upfront from MS.
Then again I wasn’t there so I obviously don’t actually know
Edited 2013-09-04 08:36 UTC
Yep, it’s complete nonsense. Nokia was worth infinitely more to MS as an independent partner with 50% smartphone market share. But the burning platform memo ruined that by causing Symbian’s users to mass migrate before its WinPhone successor was available, leaving those users with nowhere to go but Android or iOS. Anybody who thinks MS or Nokia would willingly hand their entire smartphone market share over to Google and Apple is smoking some seriously bad crack.
…
Honestly, Thom’s Nokia posts should all be titled “Nerds Say the Dumbest Things” as a perfect example of just how phenomenally stupid supposedly intelligent people can be when rabid ideology substitutes for basic logic and common sense. It’s embarrassing just to read.
Err.. did you know that many waiting rugged phone with Android inside? Many people hope for Nokia-Android phone. And what’s Nokia response when google people make an offer to them to make phone with android? Well, you know the answer.
And like other said, there’s Maemo. If it executed right, it will turn the table IMO.
They have opportunities, yet they are to blind to grab it.
Nokia makes an Android phone. Its Vertu. Go and buy it.
Veryubis no longer Nokia brand. Its now owned by some fund I think.
Nokia retained a 10% stake
So Nokia does NOT make an android phone after all.
I don’t see how you gather that from what I said.
Mid-tier or lower-tier, with common-but-elegant-body, please. Oh, and not everybody has thousands or want to spend that bucks for phones.
Edited 2013-09-03 16:17 UTC
Haha, it was a little tongue in cheek
Just to add; the remaining business left with Nokia is still profitable and I could see Nokia turn into an IBM – the consumer side of the business is gone in favour of providing the sorts of infrastructure heavy lifting telecommunications equipment that aren’t subject to the fickle whims of consumer emotions but rather whether the product does the job at the right price. Maybe long term Nokia might disappear as there is a merger with another telecoms infrastructure company like Ericsson or Alcatel.
I don’t think anyone can rationally argue against that. Nokia has lost 90% of their market cap in the last 6 years, and they lost more than half of it before Elop… So yeah, they were in serious trouble all on their own – no doubt.
I think you are taking advantage of the literal interpretation of that statement to make it seem far more ridiculous than it really is…
No, Elop’s job was not literally to trash Nokia. But his job WAS to turn Nokia into a tier one Windows Phone OEM, wasn’t it? Isn’t that, in light of the current state of things, the same thing?
And the “pick it up for a firesale” argument… Be realistic. Who, other than Microsoft, is a newly transformed but still failing Nokia worth anything to? Do you really think that the prospect of Nokia selling to Microsoft was never discussed when Elop was hired? Really?
No – I don’t think there was literally a conspiracy in the works to trash Nokia so that Microsoft could buy it cheap. What I think is that there was a plan to make Nokia more attractive to Microsoft, that the plan all along was to sell to Microsoft, and that in order to become attractive to Microsoft Nokia had to become worth buying by transforming themselves into a tier one Windows OEM…
If Windows Phone had happened to become a dominant platform along the way and Nokia happened to make a whole lot of money in the process and turn the company around, well maybe things would have turned out differently in the end. But I would wager money that most of the board thought that outcome was a pipe dream – hiring Elop was the kickoff of a buyout plan, not an effort to turn Nokia around as a company…
Its simple, Nokia’s fate was put in Microsoft’s hands the minute they decided to hitch their wagon to Windows Phone. Once that decision was made, where things went from there was entirely dependent on Microsoft’s performance, not Nokia’s… And you don’t think that there was a backup plan all along to sell in the event it didn’t work out. Really???
I don’t think anything Elop did was out of ignorance or stupidity. I think he did exactly what the board wanted him to – either get them out of the mobile phone market, or make them successful in it again (in that order). And they put together a plan to accomplish that. And now they have succeeded.
Considering that now Microsoft owns the largest Windows Phone producer, what motivation do other companies have to get into Windows Phone?
What makes you think Microsoft wants other companies getting into Windows Phone at this point? That has worked out so well for them so far…
Look at Surface. Yeah, it has problems, no doubt there – but it represents 50% of the entire Windows 8 tablet market in sales (more if you count the surface pro). Microsoft can do whatever they want at this point, their mobile hardware partners are going to all leave anyway (most already have)…
Microsoft is going vertically integrated, this is the final memo for those that didn’t see the writing on the wall already. They don’t have a choice really, if they don’t do this now Windows 8 is effectively dead as a mobile platform because everyone else already left the party – you can’t build up a platform that no one licenses…
ps. For those wondering why Nokia’s board decided to go to the dark side in the first place – well right here lies the 7.7 billion reasons…
Edited 2013-09-03 06:26 UTC
You are right about the vertical integration, and it is yet another reason why many, including myself, will not get an Xbox One. The same walled-garden, vertical integration, one OS to rule them all, mentality will apply now to gaming.
But it still remains to be seen if Microsoft can make it alone with Windows phone.
Yep and you can say goodbye to MSFT while you are at it! The ONLY reason Windows sold was thanks to the OEMs and the economies of scale, nobody is gonna shell out Apple prices for Windows products, not a chance in hell. Instead you have valve putting out their own game focused Linux and Acer reporting that now nearly 14% of their PC sales are ChromeBooks!
If there is anything written about Ballmer in the history books it’ll be that he took what was a 90%+ monopoly on the desktop and burned it to the ground in a foolish bid to become another Apple which mark my words WILL fail. Valve is gonna end up taking the gamers, who just FYI can’t stand the bloated mess that is Win 8, and Google with their business apps and virus proof ChromeOS will end up snatching away a good chunk of the business users.
I never thought I’d see the day but unless they stop shooting themselves in the foot I have a feeling the EOL of Win 7 will also be the EOL for MSFT as any kind of competitor. Real shame as Sinofsky made a damned good OS with Win 7 only to see Ballmer destroy it for “Oh hai! I’m a cellphone LULZ, did you see my apps?”.
Oh and for those that say only “Luddites” are not embracing the “innovation” that is windows 8…why have you not replaced your car’s steering wheel with handlebars? Bikes are the largest market by far, you are just a Luddite for not embracing the innovation of driving your car with bike handlebars! Or maybe, just maybe, a UI that works good in one place doesn’t magically work good in all?
i agree, i know that Microsoft is trying to push WP8 for licensing but they need to accept that they are basically going to do an Apple and have their own phone with their OS, which may not be no bad thing.
Other OEM’s have already got a free OS with Android, which Microsoft gets a fee for anyway.
I just hope that the influx of Nokia engineers at Microsoft will increase the speed of development of WP8. If Microsoft had any sense they would allow the nokia engineers to simply get on with it and not try and micro-manage them. The problem for nokia engineers in the past was there was no clear vision on what they had to develop. It should not be easy, here’s windows phone, develop it, make it competitive against iOS and Android.
I thought it was well-know that you never, ever solve software development problems by throwing more coders at them (The Mythical Man-Month, Fred Brooks).
They arguably already have their hand in Windows Phone development. For example, the changes enabling the 41MP sensor on the Lumia 1020 was a joint effort between Nokia and Microsoft. The SoC doesn’t support 41MP cameras so it uses an aux processor had to be written, along with supporting firmware code. In addition to that various components had to be tweaked and optimized to enable the lossless zoom.
So there is a great deal of collaboration already, this just tears down pointless walls surrounding two companies which have 90% of the same goals.
I’ve read that contrary to 808 41 mpix processing is done on the main Soc which despite it being worlds faster than ARM11 makes the actual picture making process speed barely acceptable.
You’re right.
http://blogs.windows.com/windows_phone/b/windowsphone/archive/2013/…
There was still work done on WP8 OS to accommodate the 1020 sensor, just not as extensive as I believed.
They don’t matter. Their focus has always been Android.
What exactly is microsoft gaining from this? It seems like a waste of money.
doh!
It’s Elop’s signing on fee as Balmer’s replacement. Didn’t you get the memo?
A lot!
They get the division’s patent portfolios, for starters. Then its human resources (including the smart engineers and industrial designers) experience, sales and marketing channels, just to name a few. In short, that $3.7b is a bargain basement price really, all things considered.
Sales and Marketing was already taken over by Microsoft, with big checks and little success.
Here are the patents they are getting:
As part of the transaction, Nokia is assigning to Microsoft its long-term patent licensing agreement with Qualcomm, as well as other licensing agreements.
—
Here are the patents they are not getting:
Nokia will retain its patent portfolio and will grant Microsoft a 10-year license to its patents at the time of the closing. Microsoft will grant Nokia reciprocal rights to use Microsoft patents in its HERE services. In addition, Nokia will grant Microsoft an option to extend this mutual patent agreement in perpetuity.
In addition, Microsoft will become a strategic licensee of the HERE platform, and will separately pay Nokia for a four-year license.
[Source http://www.microsoft.com/en-us/news/press/2013/Sep13/09-02Announcem…]
I guess Microsoft is trying to be the next Apple. To be honest, I cannot see any future of this strategy.
The tech-consumer field is actually a very difficult business to stay alive in for long. Many many companies boasting vast market shares have gone out of existence, and many have nearly gong out of existence (ask Apple) or escaped to the un-sexy (IBM) and now Nokia (with NSN).
Microsoft is clearly attempting to stay in this game. Everything changes, and everything will certainly change again.
I think it’s a pity for all the great inexpensive feature phones with week(s) of battery life that won’t be made now. That was their true strength.
Not that I dislike my Lumia 620, but I have been contemplating moving to a (secondary) Nokia 208 (the new dual sim feature phone which will be released any time now) since during my work days, smartness is secondary to phone-ness (and it comes with mail for exchange so I will still be able to sync my google calendar).
And face it, WP8 isn’t really there yet.
Wow! A twin soul!
No, it is not, but as a WP8 user of 7-8 month I can say it’s getting there slowly (emphasis on slowly). Also, the quality and availability of the apps has been increasing steadily. That being said, I can’t wait for my new Nexus 4 to be delivered :p
+2. 🙂
This price is a joke. They paid 8.5 billions for Skype but only 5.5 for Nokia?
It was obvious that this will happen, but it still makes me sad. I hope the shareholders will not accepts this, or the EU steps in somehow..
Its 7.7 billion (5.5 billion is in Euros).
That is half Nokia’s current market cap… Still though, considering Nokia has lost about 90% of their value in the last 6 years, I think the board was probably happy to take it.
So now we know what what the real 3 step internet business plan looks like:
1. Get a company to hire your mole in an effort to save their sinking business.
2. ???
3. PROFIT!
Now we know the elusive step 2: do nothing and wait…
edit: that should be 7.2 billion, not 7.7.
Edited 2013-09-03 06:41 UTC
The board voted a guy in that promised to destroy the company and then buy it which probably gave them more money than letting Nokia run.
How can you live with yourself knowing you are a rich bastard that destroyed Nokia and all the great people working there just to get a few extra millions?
What rock have you been living under? Most rich bastards live with themselves just fine, often after committing atrocities far worse than this. It’s been the case even before the word “rich” got invented.
Edited 2013-09-03 07:47 UTC
Easy: you get rewarded with a better position.
They outright bought Skype, they are only buying parts of Nokia. The smaller part, at that.
— Deleted —
Essentially what Lucas0 said above..
Edited 2013-09-03 06:30 UTC
Read this (Wed 2nd Mar 2011)
http://www.osnews.com/permalink?464534
Ok, but big companies like IBM, HP, MS, Apple, Google will never die.
Say IBM as an example, they focus on business market as always.
Nobody speak about Big Blue, but they are still there.
That will be -most probably- the case for Nokia.
Apple? That company that almost went bankrupt in the nineties? Or Palm? That company that is gone now.
I notice that you didn’t include Sun Microsystems in that list. They too focused on the “business market”.
Edited 2013-09-03 07:37 UTC
And Watson was a low-key affair?!?!?!
Never say never.
… Right.
I should not wrote “big companies”, but “big trolls” ;-P
My phone is a bottom-end (2G) Nokia 100, which runs the S-30 operating system. I think these are only sold in Asia (I live in Taiwan). It retails for around US$50, but mine was free from the phone company in exchange for a two-year contract.
For bottom-end phones, Nokia is good. Quality is excellent, battery life is about four days, even includes a built-in flashlight (can’t find that on anything else that isn’t a “smart phone”).
I have no need for a smart phone, but if I was getting one, I would never consider Windows.
Now that Microsoft is taking over Nokia, we may see the end of these low-cost phones. Maybe I should pick another Nokia 100 while they are still being made? For my needs, it’s perfect.
Sorry for this “off topic” comment, but to save 50 bucks, you signed a two year contract? Am i missing something, or is this something to reflect on?
/Uni
You’re missing something. The two-year contract (as opposed to pre-pay) also gains me a lower per-minute rate. But the free phone was an added bonus. Plus I can get a new free phone once every two years.
They’re also sold in the UK. They cost around £20 sim-free (that is, off contract) in high street shops. A couple of my friends have it – it makes a great hiking, camping and festival-going phone, apparently, because it lasts weeks without needing a recharge, and because it doesn’t feel like a big deal if you lose it.
I wonder if Microsoft intends to continue these bottom-end phones. There’s still a solid market for them in many parts of Asia, but I guess there are plenty of Chinese manufacturers who’d be more than happy to fill the gap.
WP7/8 performs much better than Android on low-end hardware (single-core, 512GB RAM). My HTC mozart was always smooth and responsive and doesn’t crash as often as other HTC phones.
However, the performance advantage will be nullified soon if not already, and Microsoft doesn’t have anything else to offer. App development and publishing on WP7/8 is also very restrictive despite of its tiny market/apps and great need to attract more developers.
It has been 2 years and Microsoft did absolutely nothing to improve the situation. Either they don’t care much about WP itself or their top management is braindead.
What “low end” hardware are you talking about? A “low end” Android phone right now would be the Nexus 4…which has a decent, multi-core CPU, a decent GPU, and plenty or RAM…and it’s $200 for an 8GB version, $250 for the 16GB. Not to sound like a commercial here, but what does Windows Phone give you for $200 to $250? (unsubsidized)
Are you serious? He spelled out the hardware he was talking about. Less frothing at the mouth and more reading.
The Nexus 4 is heavily subsidized by Google, so its not comparable. The device is sold at a loss. Its around $600 when not sold directly by Google. Try again.
The Nexus 4 doesn’t sell for anywhere near $600 here in Sweden. And we usually pay a bit more than the US price. Cheapest I could find was $422.
Actually a “cheap phone” would be the Galaxy Precedent or LG Optimus Q, both run Android 2.3, both have 512Mb of RAM and about the same in ROM (but to be fair both come with MicroSD cards included) and both go for around $50 USD without any contracts.
So I really don’t see how anybody could be arguing for dumbphones when you can already get Android units that cheap, in fact if $50 USD is too rich for your blood they have refurbs of the above for $20 USD delivered.
The scary part? Those phones…really aren’t bad, they run quite nice actually. I remember when all you could get at that price was an Android 1.4 that would freeze often and was crash prone but after a buddy got the Precedent as a “throw around” phone and loved it I decided to say “what the hell” when my contract ran out and try the LG slider and…I like it, like it a lot in fact. It loads fast, gets decent battery life, takes good pictures, all in all its a really comfortable phone.
Sure I’m not gonna be playing 3D shooters on the thing but I don’t game on my phone and everything else, GPS, media playing, heck even Youtube streaming, all those work fine. I was only gonna use this one for a month or two and then move up but now I think I’ll probably stick with it for awhile, its really just a nice comfortable phone.
Subsidized isn’t the proper word, I think the Nexus 4 just has a much lower profit margin than many other phones.
While that may have been true for WP7, didn’t i read somewhere that 8 actually requires a dual core cpu?
Dual core is a requirement for WP8.
Where do you find WP8 on a single core CPU? I thought the minimum requirements are dual-core for WP8 (which would be odd,if it really runs that well on a single-core)
Edited 2013-09-03 18:27 UTC
Such bottom-end Nokia phones can be also bought in the EU.
The message so far is that they will continue being made under Nokia brand: http://conversations.nokia.com/2013/09/06/asha-feature-phones-and-t…
All the really talented people already jumped ship. Still, this is a sad day.
Here’s hoping that Jolla becomes what Nokia used to be. They’ve got the right set of talent.
Please note, I’m not affiliated, just one of the pre-orderers. Looking forward to my first hands-on.
I find it interesting that Thom claims to have known this to be in inevitability in light of this news item:
http://www.osnews.com/story/27139/Not_even_Microsoft_has_faith_in_N…
Supposedly Nokia was in such dire straits that Microsoft didn’t want them, and this reflected poorly on Windows Phone.
Now when Microsoft buys a part of Nokia, it also reflects poorly on Windows Phone? I’m not quite sure that’s fair.
Consider the following:
32,000 employees will transfer over. That’s massive. Its a testament to the value of the devices unit. Paying $7 billion for what js supposedly a dead end venture doesn’t make sense. Obviously Microsoft sees tremendous value.
Nokia stock has gone up YoY, and they’re actually worth more today than they were a year ago. If Elop was simply a Trojan horse, he would’ve sold at the lowest possible price. This didn’t happen. Its also highly illegal to do so.
Kantar World Panel numbers came out today showing that Windows Phone is growing its share in Europe.
http://thenextweb.com/microsoft/2013/09/02/kantar-windows-phone-ext…)
That’s meaningful growth which will, as expected always go unreported on this website because it tells a different story than what Thom would have people believe.
Microsoft is buying exclusive rights to the Nokia brand for Asha, you don’t pay for something you don’t plan to continue, so that to me implies they plan to do something interesting around Windows Phone, especially when you read this from Kantar:
Microsoft paid 7 billion (plus more to license patents) for one division of a company, I think the comparison to Skype is a little off base. It didn’t buy NSN or HERE for example.
What is more likely is that Mr. Elop secured the financial stability of Nokia by giving them billions, ridding them of outstanding liabilities, and transferring the teams executing on the Lumia business to a company with unlimited cash.
He was masterful in ensuring that Nokia commanded a majority of WP sales in order to force Microsoft’s hand, and in the process he’s made himself the front runner for CEO to be in charge of the grand vision.
I didn’t think it’d happen, it will depend on how Microsoft integrates them, but I will miss following market trends and making predictions for NOK
Nelson – please take a pill, have a rest, and let others discuss the topic 🙂 Interesting, how someone can defend trojan horse, mostly destroying a company ecosystem, then buying it off, returning to his original company as a CEO. LOL 🙂
I think, that this case needs some antitrust investigation, and Nokia board needs to visit a shrink too 🙂
I’m a little overjoyed, as I’d imagine anyone who bought Nokia at 3.5, considering its 5.4 now.
I guess ignoring the commentary here did me a lot of good.
Yes, but wasn’t Nelson on point about calling Thom out?
Edited 2013-09-03 20:00 UTC
That is exactly why it did not happen.
There is a reason why NSN was not bought – it’s not Nokia’s to sell, yet. And now we know why Nokia bought out Siemens’ share out of Nokia Siemens Networks – they were preparing to sell off their mobile division and focus on the core mobile network tech.
Yep. I was just saying why they didn’t pay a higher price, they just bought one division of Nokia. From what I’ve read they seem to have paid a fair market value as well.
Its a nice deal. Nokia cleans up its balance sheet, MSFT absorbs Lumia costs and moves it forward, Nokia engineers work closer to WP ones.
Also something I think is missed in many commentary, Microsoft identified the break even point for Nokia’s devices and services line: 12.5 million a quarter, assuming the same mix of device prices.
Nokia was not too far off, certainly by Q12014 it was a possibility that D&S could break even.
They are however worth half as much as they were when Elop joined:
September 2010 $8.66
September 2013 $3.90
(I’m naturally not including the $1.40 bounce since this announcement)
Not necessarily. Just “lower”. As you yourself note, deliberately tanking the price would be illegal and selling at the bottom would look suspicious, so hey give it a little time and don’t sell at the lowest point.
I’m not suggesting that’s what happened, just so we’re clear, just saying that’s how I’d do it.
While true, $8.66 was a sharp drop already from the 12 or so they were at, and that occurred under the previous CEO.
I think its unrealistic that the Nokia board colluded with Mr. Elop to destroy the value of their own company in order to be sold for less, more than likely what I think happened is that Microsoft realized that they shared common goals but had an inefficient business model.
MSFT expects 600M in savings within 18 months of closing the deal.
That’s true, but when you look at the graph over the past three years the best you can say is that Elop managed to maintain the price and stop Nokia falling over the edge entirely.
Whether that makes him a “turnaround” CEO depends on just how dire the situation was at Nokia when he got there, I guess.
No I have to admit, it seems unlikely. Still, it’s a nice conspiracy theory…
Yeah. He put a floor under it, what is disappointing for me is that I’ll never get to see if the partnership would’ve been fruitful on its own. Of course now that MSFT has Nokia it won’t go bankrupt, but half of the fascination I had was with seeing how Nokia could thread a fine needle.
Eh, to me it depends on if we use shareprice as the sole barometer.
I think slowing the losses, divesting non-essential businesses (Selling Vertu for example) and moving Nokia to release devices every 2-3 months was an impressive managerial feat.
If (big if) Nokia ever came back (let’s say #3 or #4 worldwide) it would’ve been a historic turnaround. I guess we’ll never get to find out.
Culture clash was the term which came to my mind…
Ah, so Palm is still around? Great! Which reminds me: Who produced these Kin phones which are still famous for their high speed failure?
That’s true! Good for Nokia to get rid of the money pit.
Vast amounts of cash – yes. Unlimited? No. And those damned shareholders: See the appointment of ValueAct to the board.
You should join marketing 😉
… wait that’s mean: I take it back…
And every the YOY rising market share of WP is quoted I have to think of this one:
http://xkcd.com/1102/
Oh yes. When two European companies tried to “friendly” merge into what was NSN, internally it was already quite a culture clash, that ripped the company fabric from inside.
I wonder what will happen in this case where differences are MUCH bigger.
But this is just a takeover so probably many of those 32000 will be just shown the way home as soon as legally possible.
Edited 2013-09-03 10:40 UTC
That’s a worry I also share. Microsoft is known as an abrasive place to work — and from what I’ve heard about Nokia there was always a very upbeat, cooperative mentality.
This is why I’m hoping Mr. Elop becomes the next Microsoft CEO. There is just too much going for him. He’s run Microsoft’s most profitable division, he’s run Nokia. He knows both.
He’ll continue the course Microsoft has charted for itself in its reorganization as well. The man is very well spoken and knows the ins and outs of Microsoft.
Right, your point is well taken, which is why I stated in my first comment that I worry about the integration.
It can either go like Project Pink/Kin or it can go like Skype, Kinect, and even Google’s Android. Acquisitions are always a risky business. The one thing going for Nokia/MSFT is the fact that they’ve had a partnership for two years already.
Its actually a very favorable deal to Nokia upon a second look. They also get $2B of immediate financing from Microsoft. That covers the entire NSN acquisition.
OK — you got me. Not unlimited, just enough to buy Nokia like 9 or 10 times over.
The ValueAct stuff I’m not so worried about, the Board appointment was to avoid a protracted PR battle, but I’m not convinced they are completely beholden to them, especially since whatever supposed institutional support they have may be very fragile and predicated upon very specific critiques.
That’s true for YoY percentage increases, but this is actual marketshare increases which are concrete.
For example, WP grew 77% YoY but they didnt grow 77 marketshare percentage points. An important distinction.
Any way its sliced, Windows Phone is growing in Europe and other parts of the world and I wish some people would finally admit that.
nokia sales were growing but still utterly pathetic. the amount of money being dumped into pushing sales is amazing. profitability is nowhere to be found for wp8. the one going for them is that apple seems to have somewhat stagnated and 2nd place might be available.
double digit sequential growth is “slow”? They’re growing faster than most Android OEMs sequentially with near the same volume movements.
They are now ahead of HTC and BBRY with Sony not too far ahead. Then the only thing separating the next few OEMs up is a million or so units. Definitely achievable with the trajectory they are on.
Look at Sony’s volumes shipped for the past 3 quarters and compare it to Nokia, you’ll see Nokia is rising while Sony has remained more or less stagnant.
Nokia needs around 12.5 million units a quarter to break even with Windows Phone for the D&S division. They are well on their way. Especially with the QoQ and YoY trends.
Some people will reply that you can have high growth from low volumes, but these aren’t low volumes anymore. Any growth from here on(for example, if there is another double digit increase in Q3 2013 would be an undeniable feat).
Also impressive are the margins of these devices, the 520 has a margin of 20% and they’re selling like gangbusters.
Without the proper context that “growth” rate is meaningless. E.g. a 10% sequential growth rate on a 90% market share is orders of magnitude larger in overall shippments, than a 100% growth rate on a 3% market share. Also, the sequential growth rate of the market overall, which has been in the double digits as well (57% at least),is required to understand Nokia’s growth rate properly.
Yes and no. On Q1/2013 Sony shipped more xperias (8.1 million) than Nokia did Lumias (5.6 million). On Q2/2013 then trend contiued and Sony shipped 9.6 million xperias to 7.4 million Lumias moved by Nokia. Which means Nokia still fell short by 5.1 million units to break even, i.e. they’re still off by a bit over 40% (at least according to your estimate in that regard). Lumias, currently, are experiencing a higher growth rate than Xperias indeed.
Sony has had plenty of troubles moving their current Xperias. But in the previous year(s) they have experienced 55% sequential growth rate. Which would be impressive according to your standard; double digit growth rate. Alas…
Everything is better when the standard is arbitrary. 7.4 million of devices shipped, in a segment where 235.4 million units were sold, represents a 3% share. That’s almost statistical noise, which I would argue is a low volume when compared to the market segment overall.
Where are you getting your numbers? Some analysts are expecting that Nokia is selling the 500 series at either a loss or very small margins:
http://www.forbes.com/sites/terokuittinen/2013/08/19/the-first-wind…
Sequential growth rates from Q1 to Q2 2013 was 9.3% . From 216.3 million to 236.4 million. Nokia pretty easily beat that.
Sony
2012
Q3 8.8
Q4 8.7
2013
Q1 8.1
Q2 9.6
Nokia
2012
Q3 2.9
Q4 4.4
2013
Q1 5.6
Q2 7.4
Obviously Nokia has experienced more robust growth than Sony, and if the trend continues will over take them in a quarter or two.
Yeah, which is why I estimate that perhaps as early as Q1 of 2014 they could hit break even for the unit.
In addition to that, Microsoft’s own 2018 15% market share target for Windows Phone requires 15% sequential growth from now till then.
I’m not sure I follow. What years and what quarters are you comparing? It would be impressive up until their growth flatlined. Something I don’t preclude from happening to Nokia, they do have work cut out for them.
Well, LG is the #3 OEM and only has a 5.2% marketshare, just for context.
But yeah, it might be low if you compare it to the entire market, or as some on this website do, every Android OEM combined (Wtf? Honestly..) but it is a respectable number considering the position of the others (save for Apple and Samsung).
Its hard to know really, but Nokia had an overall 22% margin last quarter with a heavy shift towards the Lumia 520 (usage statistics collected via analytics show a shift towards the 520 as well). Now, granted there might still be some high end mixed in there.
Next quarter we should be a more solid idea of the kind of margins Nokia is extracting as the 520 will invariably make up a much larger usage share.
I’ve read reports which peg Nokia’s margin for the rest of the year in the 20s. We’ll see.
Edited 2013-09-03 19:28 UTC
Yes Nokia could beat that, but they could as easily not beat that at all. And even though they have beating the growth rate of the overall market, they are still doing so at a single digit rate. Given Nokia sits at barely over 3% of the overall share of the market, that means they need to grow consistently for a while before their market share is of any overall significance. And that is assuming everybody else is stuck with their current growth patters.
And again, since you’re talking in terms of a future which has not happened, you right now could be correct as you could be wrong.
And the pattern of using the future continues. Honestly who cares about Microsoft’s own prediction? That’s hardly a fact. Blackberry predicted BB OS 10 devices were going to fly off the shelves, and yet…
I’m simply stating that in my opinion it’s silly to pick those quarters that agree with your narrative, while ignoring the ones that don’t (Nokia has had quarters of shitty growth as well in the past few years), in order to establish a pattern in a market as volatile and dynamic as the smartphones.
That still means nothing, it simply illustrates how dominated the market is by the main 2 players: Samsung and Apple. Just because LG is #3, it does not mean their share is significant either, specially taking in consideration LG has less than 1/4 the share of the #2 player.
In fact, to me it seems you could be trying to have it both ways. In multiple times, you have made the point of how insignificant the market share of every android vendor, other than Samsung, really is. And now you’re making the case that Nokia’s share is significant even though it’s still smaller than the share/shipping volume of some of the very vendors you consider insignificant elsewhere.
[/q]
Those websites may be handpicking the stats that support their biased narratives. Which really is not that different from what you routinely do regarding Nokia.
I asked where you got those numbers, and your answer is “from the grapevine,” Huh?
Of course, but for right now, Nokia is on a fine trajectory, which is I think all I’ve been arguing. It flies in the face of the notion that Nokia is in crisis strategically when their strategy is bearing out just fine.
Yes, which is why I said “if”. Its a strong possibility, but by no means assured. I only brought Sony for comparisons sake. I don’t think Thom makes 10 OSNews posts a month on how Sony is doomed, despite their troubles.
I also don’t see smear articles on LG, Lenovo, etc. who also have single digit marketshare. Basically everyone except Samsung and Apple has single digit market share.
But Blackberry is not Microsoft and BB10 is not Windows Phone. I’m only commenting on what Microsoft has said, and how it is achievable. Especially considering Nokia is already exceeding that required rate two fold.
That’s a great point actually, there’s a lot of uncertainty and it’s definitely true that things can change seemingly over night. There’s good and bad in that though. Just as their fortunes can take a turn for the worst, they can also stumble on to prosperity.
I’ve made a point of how insignifcant profit margins are. Market share is a reality that OEMs have to deal with. However Nokia needs to get to point B before they can go to point C. Establish themselves as #3 and then move on from there.
I think its more of, how do people see Nokia’s figures as disastrous but not LG or Lenovo or Sony. They don’t get the constant smear articles, the snarky lead in, or anything like that.
I think Nokia potentially one day reaching #3 is just a milestone, I would hope they would push higher into more share but its hard to tell this far out. We’ll see how Q3 and Q4 look to see if any concrete gains are posted.
They went from #9 to #6 I believe though, so they are showing upward mobility.
I try not to, but I acknowledge that I do root for them so there is some confirmation bias in what I may say. So grain of salt and all that. I don’t expect my analysis to be taken as gospel, only taken into account against the backdrop of negativity here.
Yeah, it’s difficult to know absolutely, but you can derive ranges that are more or less on the money. Again, we’ll see October 19th how close I was.
Oh, come now, I’m sure it will work at LEAST as well for them as the Intel and Nokia engineers who collaborated on Meego!
I stand corrected, you are perfectly right!
Given all the apparent synergies what could go wrong?
Oh dear – this looks bonkers. Two drowning men clutching at each other can’t save themselves.
I thought with Ballmer going there was going to be a real rethink at Microsoft and that part of that rethink – if they thought clearly and clinically about the company’s future – would be to abandon Windows Phone. Microsoft appear to making exactly the same error Apple did back in the 1990s. Then Apple was hypnotised by the staggering success of Microsoft and so it thought it had to be another Microsoft, it had to compete with Microsoft on the same terrain and chase the same markets and products, deploy the same business strategy. It didn’t – which is exactly what Jobs said when he returned, forget Microsoft and concentrate on what Apple does well. Since MacOSX Microsoft has been hypnotised by Apple, and then by a combination of Apple and Google. MacOSX lured Microsoft into the elephantine disaster that was Vista, iOS and Android have lured it into the disaster that is Windows 8 and Windows Phone, Google search lured it into the disaster that is Bing, and it’s the same story with Zune, XBox and so much else.
Microsoft needs to start shedding product lines, it needs to be radical about that. All the pretence at being a consumer products company should be shed, Microsoft has never been a consumer products company and has never made any profits of consequence in consumer markets, and that’s after years of intense effort and billions and billions of money flushed away. Why does Microsoft need to make a phone, a gaming console, a search engine?
Microsoft got so used to being omnipresent and hegemonically dominant for a brief period in the 1990s that it came to think that that was the only way to run a big successful tech company. It isn’t. Microsoft need to concentrate on who and what they really are, which is a software company that is most successful in the enterprise markets. We are witnessing as a consequence of the explosion of mobile computing devices the growth and establishment of the largest and most vibrant software markets in tech history. These devices and the software they run will dominate computing for the next decade and more, and are transforming corprorate IT. And Microsoft does not have a presence of consequence in those markets. What an utter strategic failure. It’s 2013, there are already a billion plus mobile computing devices in use and there isn’t a descent working version of Office that can run on those devices. That’s insane.
So what does the next couple of years hold for Microsoft? An absurd and almost certainly disorientating and chaotic internal reorganisation, a lame duck CEO followed by a new one trying to take control of the sprawling Byzantine mess, and now a huge new loss making business bolted on. It’s not just the CEO who should be sacked it’s the entire Board of Directors. How long until a shareholders revolt?
Ben Thomson is as interesting as ever on this fiasco.
http://stratechery.com/2013/the-deal-that-makes-no-sense/
Additionally read the numerous posts by the ex-Nokia exec Tomi Ahonen who has picked apart the Nokia Windows Phone disaster from day one and who perceptively identifies the Microsoft acquisition of Skype as the key factor in the poisoning of Microsoft’s relationship to the crucial carriers.
http://communities-dominate.blogs.com/brands/
On the other hand Brian S Hall think this is a brilliant move
http://techpinions.com/iphone-ios7-remake-computing/22439
Well put Nelson.
With the launching of the multiple platforms of Windows 8, Microsoft has reshaped itself to serve the mobile market. In years past, Microsoft CE devices and Windows Mobile was marketed to give them a toe-hold, with devices like the Compaq IPAQ and the Samsung Blackjack.
Office365 is another example of how Microsoft has changed it’s marketing perspective as package software will be come a rare commodity in the very near future.
I have owned a number of Nokia phones, my favorite was an E71, a beautifully built phone, for a time when cell phones were for calling, with occasional texts and emails. My last one was a Nokia 900 with Windows Phone 7.8. I do like Windows phone live tiles and overall usability, but for me, there was still too much lacking when compared to IOS or Android to stay on the platform.
If you look at all the changes and purchases that Microsoft as made in recent years, including Nokia, it is easy to see that Microsoft has adopted of the Apple ecosystem strategy.
Arm chair quarterbacks are never going to be 100% right. Another article brought up microsoft’s purchase of Danger which led to the Kin phones. Also relevant is the recent “succcess” of surface tablets. I don’t think Microsoft gets mobile hardware.
The somewhat good thing about the transaction form Microsoft, is that they are also getting Elop. Which sounds crazy, if you believe as I do that Elop really sucked as CEO of Nokia. But, the phone division of Nokia is going to be headed by someone who believes in it. He’ll probably get promoted to CEO. If he doesn’t… look out! The New CEO’s first job will be to blame everything on his predecessor and things like this acquisition. It could end up being a repeat of HP/Palm.
. I don’t think Microsoft gets mobile hardware
MS mobile hardware is awesome, I don’t know why do you say that.
It doesn’t sell very well…
It sells well, where are you getting your numbers from?
Edited 2013-09-03 17:44 UTC
The Wall Street Journal.
http://blogs.wsj.com/digits/2013/07/18/microsoft-takes-900-million-…
Makes a large assumption that the write off consisted primarily of assembled surface units. The actual unsold inventory (as in completely assembled and boxed) may not be large, there’s also accessory charges to take into account and unassembled parts.
Write downs are filled with accounting gimmicks which makes deriving the true meaning behind them a little difficult.
Companies that are good at selling mobile hardware don’t have such stories written about large write downs against inventory.
But can the same be said for the software that runs on it
But can the same be said for the software that runs on it
What?, Windows mobile is awesome too.
Good to see you are alive and well Muhammad Saeed al-Sahhaf.
Look at the bright side: At least Nokia sold Qt in time.
Sad, but expected news, though…
So what, Qt is still owned by a proprietary company that could be acquired from anyone or change the license when ever they want.
Edited 2013-09-03 15:15 UTC
The KDE free QT foundation has a plan. Basically, if they discontinue the development on a free QT version, KDE gets to re-license previous versions as BSD. If the foundation did that, it would undercut the commercial licensing of QT as companies could take the BSD licenced QT and do whatever it wanted to with it without releasing their source code ( as would be required with GPL) or paying Digia a cent.
http://www.kde.org/community/whatiskde/kdefreeqtfoundation.php
Only if they discontinue developing, and Digia doesn’t have to, all they need is to change the license and that won’t apply, it is a vaporware hope.
Yes, it will apply. The agreement explicitly says that the condition is that they must continue development
under the LGPL 2.1 and the GPL 3 or else, the Foundation can re-license it as BSD.
I told you, they don’t have to stop development, for example, they release a brand new product called QtPlus or QtPro, and they start working exclusively in that product, all the new stuff goes there, and they only maintain the old Qt a patch a month, hey that is still active development, it means they don’t have to release it under BSD, now, Is not clear if that agreement has to
be renewed with every version of Qt, hey, maybe It won’t apply with Qt6, you never now, Digia is still in control.
Except that the actual agreement doesn’t talk about “active development” but “important releases”, which it defines as “bug fixes, performance enhancenments and new functionality, all in accordance with industry practice for an actively developed C++ toolkit in similar state of development”.
QtPlus/QtPro would be the obvious, immediate example of a similar toolkit.
About versions, the letter doesn’t even mention version numbers, but Qt as a whole.
No, QtPlus and QtPro could be a completely new product, compatible with Qt, but not the same product and since the agreement only applies to Qt and not the new products my hypotheses still applies, that agreement is fragile.
Edited 2013-09-04 14:46 UTC
Well, you can always find a way around agreements. It happens all the time, but it’s not as simple as you imply. And the agreement addresses what you said. If Nokia/Digia or whoever owns the rights of Qt, ever puts existing classes, methods, components or functionality in another library or software package (or writes replacements of those classes, components for this new library/software), they (and any changes made to them) immediately become part of Qt.
Yes, Digia could fork it and make a different product, but they’d have to write entirely new classes, which can’t be replacements for the “old” ones (or they’d also become part of Qt), so they’d have to maintain two different code bases. And a couple of patches every now and then in Qt wouldn’t be enough: if, in the course of a year, there’s a significant gap between the development of QtPlus (or any other toolkit similar to Qt, as the agreement explains) and the development of Qt, the Foundation can claim that Digia failed to comply with the agreement.
Again, I’m not saying it is a perfect agreement, but it isn’t more fragile than any other agreement in the industry (as a lot of suits show). And it certainly isn’t a “vaporware hope”.
Edited 2013-09-04 19:57 UTC
No they don’t have to write entire new classes, not at all, the own Qt, they own the trademark, the code, everything, they don’t have to do that, and they don’t have to maintain 2 different code bases, all they need to do is maintain the new product and patch the old one, That agreement is vaporware.
Now, they can go beyond, they can take all the community patches to the old Qt and integrate them into the new one, make them closed source and even improve it w/o having to open source the changes they made, that agreement has plenty of holes, but hey, it keep the conscience of people like you in a slumber.
Yes, they do. The agreement, which they signed, says so. Period.
No they don’t that agreement is vaporware.
Period.
Cause you say so? Everything I said is in the actual agreement. What you are saying is just your opinion. Which is more valid?
Edited 2013-09-04 21:28 UTC
I’ve told you that the agreement has plenty of holes that makes it vapor ware, I’ve show you some examples, but you can’t read or don’t care.
It is vaporware, period.
The examples aren’t good. The moment they put Qt classes or functionality in the “new” library, they become part of Qt, and all of the terms of the agreement apply to them. That’s not my opinion, but what the letter says.
But we’re running in circles. All of what you wrote, I already addressed in my comments. Fortunately, the agreement is public, and anyone interested can read it and make their own conclusions, so I see no point in continuing stating the obvious.
The moment they put Qt classes or functionality in the “new” library, they become part of Qt
That is ridiculous, they become part if they extend it, but they can take the existing Qt classes, rename them (yes, they own Qt, they can do that) and with Polymorphism make them compatible with the old one, it is done all the time when someone tries to work around a license.
And if that doesn’t work, there are ten more ways to do it. it is vaporware.
Edited 2013-09-04 21:53 UTC
Elop is done wrecking Nokia. Now he moves on to take care of what is left of Microsoft.
Nokia is not ONLY phones.
See http://nsn.com/portfolio/products
This remind me the story of Alcatel-Lucent when they sold their “Speedtouch” brand in the DSL business.
Alcatel-Lucent is still in the DSL business providing high quality equipments to the ISP operators.
Nokia will simply focus on the business side, not more on the customer premises side.
It looks like a lot of people forget about this aspect, and are acting like Nokia will die. This is totally untrue !
Lumia brand will probably go to MS, and there are still smart engineers in Finland providing smart GSM products.
Note:As an example, ALCATEL ONE TOUCH brand is owned by TCL Communication.
FYI: Nokia Siemens Networks is not yet Nokia Networks(like it was in 2006)
Microsoft will stop licensing Windows Phone 8 and later Windows 8 to other companies (like Jobs did when he returned to Apple).
They will try to control the entire experience software and hardware (Like Apple).
They will end up with single digit percent market share (Like Apple).
Android will be the new Windows (fine, it already is) used by many companies and controlling 90% of the market.
All of that seems fairly obvious except for ending the Windows 8+ licensing program. That’s a pretty bold prediction.
While the desktop market is shrinking rapidly relative to the overall consumer computing space, Windows still has close to 90% of the former, and desktops are still holding rather firm within businesses.
Since you apparently don’t believe Macs will gain double-digit desktop share, that leaves Linux – Ubuntu convergence devices, ChromeOS, Android on the desktop, or an even darker horse. Maybe a brilliant run by Haiku or ReactOS? 😉
Unless a competitor rises to destroy their market position in desktops, as Android did to their mobile product, it’s pretty hard to imagine Microsoft pulling the dominant desktop OS away from Dell, HP, Asus, Lenovo and the rest.
But if it happens within 5 years, please link to this comment and say “I told you so”. If it happens in 3, I’ll link to this comment and say “Wow, you told me so!” 😀
well i may be wrong about Windows 8. But still think it is a possibility for Windows 8 RT and possibly Windows 9…
I myself use Ubuntu on one of my laptops 🙂
Why no talk of profit?
People talk market share like it’s the 90’s and apple only has a little bit. But they are taking home nearly all the profit in the mobile space.
I don’t understand why this is continually ignored here. Aren’t companies in the business of making profit? How long can Android hold market share if no one is making any money from it?
Because that ‘cash’ is still tied up in the stock market in one form or another. Apple has one of the lowest R&D budgets per sales and has a portfolio that rivals large hedge funds.
http://www.forbes.com/sites/darcytravlos/2013/03/24/apple-cash-marg…
This gives a good overview, and why the market looks at Apple’s stock price and NOT their cash on hand.
I’m not sure I understand how this applies to my point. The article was about what apple is doing with all the profits it is making, and it usually hoards lots of cash (even in the dark days of the 90’s they held more cash and short-term assets than most companies).
My point was that Apple is earning those profits in the first place. Samsung or HTC or Nokia or you name it – they aren’t earning that kind of money from their mobile divisions, hardware or software. In some cases their other businesses are propping up their mobile divisions, and their designs are copy cats with short lifespans.
I get that you if you aren’t in the states you might not see the proliferation of iOS devices, but I don’t get the continued focus on “market share” with no talk of business realities.
The comparison back to the OS wars of the 90’s does not apply, because back then Microsoft was taking all the market share AND most of the profit. Android isn’t a company, it’s an advertising delivery platform.
Conversely, How much longer can Apple Maintain such profit margins as their market share dwindles? Other competitors will gain the efficiencies of massive scale, that Apple cannot.
You made some cool phones back in the day.
Maybe now Windows Phone can have it’s own Nexus (Surface ?) line.
TOLD YOU SO.
So who wants to start the countdown to a repeat of Danger, Inc.?
… when conspiranoids are right.
I have to agree with other analses I’ve seen on the internet. Nokia was a locked in partner for MS. They produced wp8 phones and even are starting to offer tablets. With this amount of lockin nokia was de facto an MS subcompany. Why did MS have to buy them out?
I’ve seen 2 different feasable explanations: either they were about to pull the plug on mobile or they were threatening to switch to android.
The worst part of this all is the inevitable increase of patent privateering (or even outright trolling if they get the patents) by Microsoft.
Edited 2013-09-03 15:45 UTC
Meanwhile, Motorola has given Google exactly 0 leverage in the mobile patent scene.
http://www.fosspatents.com/2013/09/german-appeals-court-lifts-googl…
Microsoft now probably has one of the most, if not THE most threatening patent arsenal in the industry.
From what I’ve read, they didn’t get the patents. Nokia as a shell company will still own them. But this won’t stop MS from privateering – i.e. directing that shell Nokia troll to attack MS competitors. I wish this kind of idiocy could be stopped by some antitrust regulations.
Edited 2013-09-03 19:36 UTC
Um.. Some antitrust regulations that can be vetoed by Obama
… over the possibility of any wrongdoing on Elop’s conduct as Nokia’s CEO?
This will be very interesting for the mobile patent wars.
In the first couple of years (since 1998) of my mobile phone user experience I bought a few phones from “unlikely” brands: Philips (huge!) Motorola (the (in)famous StarTAC), Siemens…
But after that it was Nokia all the way, up to the N8.
But then I opened my eyes (I realized that Nokia wasn’t going anywhere) and about 18 months ago I bought my first Samsung, the Galaxy S2.
Even so I can’t help feeling sad. I wish I hadn’t sold my N8 for 100 Euro. R.I.P. Nokia, you’ll be missed.