No matter how you measure it -- be it in terms of smartphone market share, consumer mindshare, review scores, or profits -- Nokia is in trouble. Even its CEO seems to think so. As such, everyone from professional analysts to the humble blogger with a WordPress account has chimed in with advice for Nokia's new chief, Stephen Elop, a Canadian-born ex-Microsoftie who will present his plan to return the proud Finnish company to supreme financial dominance at Friday's annual Capital Market Day shindig. And while Nokia might not have any significant presence in the US market, that doesn't mean that your Engadget editors don't have a few strong opinions to share ahead of Friday's big announcements. Click through the break for the full read and then toss in your own two cents in the comments below. With any luck, we'll make enough money to build, catalyze and/or join a competitive ecosystem all our own.
It's my belief that factual rumors and hopeful fictions spawned of frustration, spurred by Elop's "build, catalyze and/or join a competitive ecosystem" remark and subsequently leaked "burning platform" memo, have combined over the last few weeks to create a mega-rumor that has Nokia switching to Windows Phone 7. I find it very hard to believe that Nokia will purge its MeeGo or Symbian operating systems in favor of something else. As a Symbian replacement, Windows Phone 7 certainly doesn't scale downward to support Nokia's goal of "smartphone democratization." And I don't see any outward deceleration of Nokia's efforts related to MeeGo. Besides, any meaningful move to another OS would slow, not accelerate, Nokia's return to smartphone dominance (and large profit margins) when taking into account the radical shift this would create for Nokia services and its Qt developer community. If anything, and this is a serious stretch to my imagination, I could see Nokia using Windows Phone 7 as stop-gap solution until MeeGo has had a chance to mature -- something that might be beneficial to both Microsoft (globally) and Nokia (in the US) in the near term.
On Friday, I see Nokia announcing a reorganization and other concrete steps that will accelerate MeeGo's replacement of Symbian at the top of its product portfolio, perhaps with ecosystem support from Microsoft and others. When I say support, I mean something big, similar in size to Sony's recently announced PlayStation Suite for Android. Or imagine how something like the ability to run Android apps on MeeGo devices could catalyze adoption of the fledgling Nokia platform. Regardless of what's announced, it's worth remembering that Nokia is still profitable and smartphone adoption is in its infancy when looking at the global marketplace (most people still use dumb or featurephones). As I've said before, Nokia shouldn't abandon its strategy of owning the OS, hardware, and services in order to become just another OEM. It won't find riches battling the likes of HTC, Samsung, Motorola, and LG trying to differentiate rectangular touchscreen slabs running a commodity OS -- it still has time to innovate. Besides, all that R&D spending has to pay off eventually.
Nokia, understandably, has a reputation as a very stubborn company. It's an easy attitude to take when you're on top -- and Nokia's been on top for a very, very long time, having jumped out to an early lead in the smartphone race at a time when many other companies still saw PDAs and cellphones as separate products. I've been following Nokia closely during my five years here at Engadget, and though rumors of platform switches have come up every so often, I've never seen it quite like this. It's feeling legitimate (and justified) in a way that it never has before. What's more, I think that even the most devout Nokia users have started admitting that the company needs to fundamentally rethink how it's going about its business.
Of course, it was pretty clear from the outset that Stephen Elop was brought in to clean the proverbial house -- and the leaked memo from earlier this week suggests he's well on his way to doing exactly that. Though I think it's inevitable that the company will be joining forces with an outside platform, I'm genuinely confused as to how it's going to play out: outdated or not, Nokia is very strongly associated with its software DNA, and there's plenty of DNA remaining that can be refreshed and brought up to 2011 standards. Android might allow that, while Windows Phone 7 -- in its present form, at least -- would not. I'm also conflicted as to how Nokia graciously exits either of its existing smartphone platforms: Symbian, for all its flaws and obsolete ways, still dominates a number of markets and seems to have long-term viability as a low-end play, while MeeGo has never even had a chance to get off the ground. It'd be terribly embarrassing for both Nokia and Intel if Espoo were to bow out without contributing even a single product to the market.
In light of all that uncertainty, I'm as fascinated and spellbound by Nokia right now as I have been in several years. It sounds like Elop recognizes the problems from top to bottom -- but let's be honest, that's the easy part. Now he has to execute on a game plan against some extremely fierce and battle-tested competitors.
As a long-time Nokia user and fan, I've been quite critical of the company for several years. Starting with the 5800 XpressMusic experiment, and continuing on with the N97 disaster, Nokia has continually missed the mark in creating phones that truly compete with the iPhone and with Android devices. More recently, the N900 missed the mark in terms of hardware, and the N8 in terms of software. In addition, Ovi never lived up to its promise of becoming the Nokia ecosystem. Sure, Nokia still sells loads of low and mid-range phones the world over, and Qt is a compelling cross-platform development environment, but what happened to the company that owned the smartphone market and dominated the high end? What happened to the Nokia that defined the idea of convergence, and executed it with the N95? I asked that question a little over two years ago in this editorial, and I continue to ask that question in the podcast today.
Then along comes Stephen Elop, hired to clean house and take no prisoners, but save the burning platform -- a monumental task for sure. Microsoft launches Windows Phone 7 with arguably mixed reception from consumers, but with decent manufacturer and carrier support, and favorable reception from the tech community. Unlike Google with Android, which swallows everything like a black hole, and Apple with iOS, which shines almighty like a blinding light, Nokia, just like Microsoft, needs to re-invent itself in mobile, and needs help. And there you have it, high-end Nokia hardware running Microsoft software and services -- a strange match but a great opportunity for both companies. I'm not sure this union will take place, but I want to believe, because I still have a lot of hope for Nokia, and lot of respect for Windows Phone 7. Call me crazy, but let's see what happens Friday, and maybe I will eat my words.
I sit here with a Nokia C5, C6-01, N8, and E7 in front of me. If I never had to turn them on, you'd have a pretty easy time convincing me that Nokia's doing just fine. The C5 is small, simple and uncomplicated, the C6-01 adds some sheen for the style-conscious, and the two top-tier devices feel like premium slabs of well engineered hardware. The problem, as we all know by now, lies within. Symbian is under assault by the far more accessible and touchscreen-friendly Android, which, to make matters worse, is now starting to filter through into lower-priced devices. That, in a nutshell of bitterness and missed opportunities, is Stephen Elop's "burning platform."
The option to just abandon the Symbian ship and leap atop the Android vessel is appealing, but seems logistically impossible. Nokia has spent far too long working on a hardware proposition that disregards the specs race and focuses on efficient use of resources. If Nokia were to leap into the Android wars, it'd do so without any market advantage beyond its widespread brand recognition and consumer goodwill, and would flounder against the likes of Samsung with its exclusive Super AMOLED displays and Hummingbird processors.
That leaves only Windows Phone 7 and MeeGo as alternatives to Symbian. I've nothing against MeeGo, it looks like a highly promising OS, but let's not forget that it's not out yet and the blueprint for a great platform isn't worth much when your current one is burning down. Nokia needs to keep up with the competition, no matter how big its market share may be today. So, really and truly, the decision about what to do isn't all that hard. You either launch your MeeGo armada and show us naysayers who the daddy of the mobile world is, or swallow your pride, make the necessary internal adjustments, and join the Windows Phone 7 party. WP7 is just the sort of nascent OS, with little spec differentiation between handset makers, that Nokia could latch on to and make its own -- just by brutalizing every other manufacturer in terms of build quality and construction materials, two of Nokia's undoubted strengths.
What we know with absolute certainty is that this Friday will be a milestone day for Nokia, whether it chooses to break off from its current course of action or stick with it. Stephen Elop has expressed a most sincere wish to shake up the company and my own expectation is that what's left of its former leadership will already be freshening up their résumés and LinkedIn profiles. The reason for this overhaul of staff isn't due to incompetence, in my opinion, but a simple conflict of opinion as to where Nokia's supposed to be headed. In other words, if you're going to keep the current strategy going, you might as well keep the people that believe in it. So Nokia's going to change and the first step is being taken on Friday. Only question is, in what direction?