Reports are saying that carriers and Nokia’s board are becoming restless with WP7, and they are pushing for alternatives to WP7, to slow down the fast decline of the company, and the consumer rejection of WP7 smartphones. It seems that WP7 might have been another critical mistake for Nokia and this time it might be an endgame scenario.
I still believe that Nokia made a huge mistake by not adopting Android as their main operating system. I don’t think it was just a decision that Nokia’s board or Elop made, but one that was influenced by the whole culture of the company. Many Nokia employees probably couldn’t see themselves using Android. I guess that feeling was worth more to them than saving the company in a practical manner.
That’s how they decided that instead of going with Android, (a proven OS with a following almost as large as iOS) they bet their whole company. Let me spell this out carefully: The #1 phone manufacturer in the world adopts an unproven OS in the market – WP7 – that if not successful, would bring the end of Nokia, permanently. This was emphasized by the fact that they also decided to kill Meego and Symbian (over a period of several years), as they hoped to transition to WP7.
They also wrongly assumed that most of their loyal Symbian customers would simply transition to their WP7 phones. That has never made sense to me, because Symbian used to be a very advanced and complex operating system as far as functionality goes, and for that target audience, Android might make more sense than WP7. Most Symbian users will not switch to WP7. They will switch to Android, and a lot of them have already done it. Some, like myself, did it years ago.
The Big Decline
Elop said that Nokia is committed to WP7, but their customers aren’t, which is why we now know that Nokia isn’t selling WP7 phones fast enough to account for the decline of Symbian. Even in markets they were absolutely dominating with 70% market share, like China or India, there is a noticeable decline. Even in those countries, Nokia has less than 20% market share now, and it’s still rapidly falling.
Nokia has already lost the “phone” manufacturer crown this year (last year they lost the smartphone crown), carriers are not pleased with Lumia phones, and say they aren’t competitive. Now even the board (the same one that hired Elop) is panicking; it seems they want Nokia to reverse their plans about WP7 being their only OS, and are starting to push the Meego-powered N9 stateside. They are also regaining focus on Symbian Belle smartphones, like the PureView 808, which they are also pushing to the North American market.
Symbian still has some life in it thanks to brand inertia. There will be people that will buy Symbian phones years from now, although the market will continue to decline fast against Android smartphones. So Symbian really is a dead-end, no matter how much they beautify it and how well they make it work.
If only the Nokia board and its CEO at the time realized this in 2007-2008, after the iPhone appeared, and started pushing Maemo/Meego hard internally, the current crisis would have been easily avoided. If they did, and they also promoted Meego to other manufacturers, (the only way you can really form a strong following today) these manufacturers might have been inclined to prefer it over Android. At the very least as an alternative platform, Meego might’ve been much more successful than WP7 has been so far, especially when the N9 commonly received rave reviews.
I doubt Nokia will go back to Android anytime soon, even though I think the board is strongly considering it now after their stock price is the lowest it’s been in 15 years, and their credit rating keeps getting downgraded. The reason they won’t go back now is most likely because of an inked deal with Microsoft stating they can’t touch Android for a specific time period, which is usually stated in Terms Of Agreement. This is how big business works, this is how companies flourish or flounder; by the set of friends and business partners they choose.
Undoubtedly, Nokia is likely to start focusing on Meego again, and redouble their efforts with Symbian, as they continue with WP7. The fact remains that the board is desperate now that they see WP7 is not doing well, so they’ve started to seriously look into alternatives and how they can increase revenue sans WP7.
Unfortunately for them, I think they took this course of action much too late. They shouldn’t have ever announced Symbian and Meego’s death at the beginning of 2011. The end of next year could spell an acquisition of Nokia if it doesn’t find a way to steer itself out of the nosedive it’s currently in. The company however, like so many dinosaurs of yesteryear, may very well be doomed to extinction, regardless.
Nokia’s current business is unsustainable for such a large company with so many employees, and even if they survive the massive decline without being acquired, they’ll still be a much smaller company than they used to be, with not much impact on the market. For this they have to thank the leaders who thought Symbian was still competitive years after the iPhone’s launch, and to those that thought betting the #1 phone manufacturer on a 2% market share OS was a bright idea.