Nokia CEO Stephen Elop has sent out a 1,300-word memo to company employees detailing his anger at the phone manufacturer for losing out to Apple and Google.
The once world-leader in mobile phone production has been on a downward spiral since Apple launched its iPhone, leaving the company’s Symbian OS in the technological dust.
Nokia has repeatedly failed to compete with new products and technology launched by other smartphone manufacturers but maintains stability thanks to its large share in the ‘dumbphone’ market.
The leaked memo details Elop’s anger at Nokia’s failing to achieve anything close to that of Apple: “The first iPhone shipped in 2007, and we still don’t have a product that is close to their experience.”
Elop was also angry that Android, a relatively new OS at only two years old, has overtaken Nokia in the smartphone stakes.
Nokia is now starting to lose out on its last bastion of hope in the dumbphone market to Shenzen-based companies, posing an even bigger threat to the manufacturer’s future.
So Elop, an ex-Microsoft employee, published the memo in hope of rallying the troops. Nokia is expected to make some pretty serious changes following this year’s MWC, including internal company structure and a greater emphasis on Finnish management spending time in Silicon Valley.
But for Nokia to really get back on track in the mobile market they will need to dump Symbian as an OS. For years it was a market leader, but has been rapidly surpassed by Google and Apple’s offerings, something which Nokia has never managed to catch up with. Rumours indicate a collaboration with Microsoft and Windows Phone 7 but then that is an OS that is still yet to establish itself.
So why not Android? Perhaps a few years ago when the OS came about then Nokia could have pre-empted HTC and Samsung as leading manufacturers, but now the company is encroaching on big boy territory and would have some serious work cut out if it wanted to take them on. HTC and Samsung have built consumer trust as Android manufacturers, and Nokia would have to do the same. There is no doubt that Nokia can build well-made devices; the N8 is definitely a nice piece of kit, but it is simply a case of sloppy OS decisions.
Stephen Elop goes into great detail as to the ever increasing threat posed by competition and explains why Nokia just isn’t keeping up: “There is intense heat coming from our competitors, more rapidly than we ever expected. Apple disrupted the market by redefining the smartphone and attracting developers to a closed, but very powerful ecosystem.”
“…and then, there is Android. In about two years, Android created a platform that attracts application developers, service providers and hardware manufacturers. Android came in at the high-end, they are now winning the mid-range, and quickly they are going downstream to phones under €100. Google has become a gravitational force, drawing much of the industry’s innovation to its core.”
“While competitors poured flames on our market share, what happened at Nokia? We fell behind, we missed big trends, and we lost time. At that time, we thought we were making the right decisions; but, with the benefit of hindsight, we now find ourselves years behind.”
“The battle of devices has now become a war of ecosystems, where ecosystems include not only the hardware and software of the device, but developers, applications, ecommerce, advertising, search, social applications, location-based services, unified communications and many other things. Our competitors aren’t taking our market share with devices; they are taking our market share with an entire ecosystem. This means we’re going to have to decide how we either build, catalyse or join an ecosystem.”
But he also describes what he thinks needs to be done and sets out some serious ‘fightin’ words’ for Nokia employees:
“We are working on a path forward — a path to rebuild our market leadership. When we share the new strategy on February 11, it will be a huge effort to transform our company. But, I believe that together, we can face the challenges ahead of us. Together, we can choose to define our future.”
It looks like Nokia have already got started if this Reuters report is anything to go by, the company appears to have cancelled the MeeGo-powered N9.
With a CEO like this the company deserves to succeed, let’s just hope whatever is announced on the 11th signals a return to form for the company that once produced my favourite mobile of all time: the 3310.