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Nokia Issues Profit Warning
jones_supa submitted an article in the Guardian. From the article "Shares in the Finnish phone maker Nokia plunged by 15% on Tuesday as the company warned that it may make no profit on phone sales in the quarter to the end of June, and that overall phone sales will be 'substantially below' its earlier forecast of €6.1bn to €6.6bn. Carolina Milanesi, mobile phones analyst for the research company Gartner, said Tuesday's warnings could mark the low point for Nokia, which has not made a loss in its handset division for more than a decade."
TFA says it's mostly due to them getting cut at both ends. By the Chinese on low price phones, which Nokia has traditionally sold an ass-ton of, world wide. And by android and apple on the top end. (I think this is a lot more in the US than the ROTW, but US is a big smartphone market...)
Kind of a shame really, I was looking forward to more N900-esque phones, but I don't think that will be happening anymore. I'll also miss smartphones with buttons on them.
"It remains to be seen how low [market share] could go, but for smartphones we are talking about going under 20% this year." Only two years ago Nokia had a 40% share of the smartphone market, but it was passed in the first quarter of this year by Android, with 32%. Nokia had 24% and Apple 18%.
Sent from my PDP-11
When Nokia made their deal with Microsoft, they basically told the world "Don't buy any of our current phones because we're orphaning them."
Remember, they said that they would be switching ALL their phones to WP7. Would you lock yourself into a long-term contract for an orphan phone?
Microsoft wasn't stupid - they could foresee that Nokia share value would collapse - by next year, they'll be able to buy Nokia outright for a lot less than the money they gave them.
"Coming soon - The Microsoft X-Phone - it works great with your X-Box!"
Let's call it what it is, Anti-Social Media.
It seems more likely to me that the decision to partner with Microsoft was because they knew they wouldn't be making a profit and something had to change.
I think the real reason they're not making a profit is their phones are so dreadfully out of date with what people want now that they aren't selling as well. Nokia's had a branding and model issue for quite some time - go to nokia.com and see how many different phones you can find. Different colors, shapes, too many options. Too many OSs, no clear dev schemes for third parties.
Compare that against apple's previous 'We have one phone that comes in black' and current 'We have one phone that comes in black or white'.
First and foremost, Nokia is losing money because of Nokia.
Secondly Apple / Android is why Nokia is losing money.
Thirdly, Microsoft is why Nokia will continue to lose money.
How is the lagging Symbian business, which has been rotting for years, remotely related to Microsoft?
No, this is why they signed a deal with the devil. Everybody has been taking a crack at Nokia lately and they haven't been able to deal a single decent blow in return, iPhone and Android have been eating the aging Symbian for lunch and the Maemo/Meego replacements haven't been ready. They could of course become the latecomer to Android, but so many companies now make good Android phones they'd be sure to disappoint. So they went to bed with Microsoft, the market already then realized it was a mark of desperation sinking their stock price. Now we learn it's actually worse. I figure the layoffs are about to begin and who do you think that will be, the Microsoft Phone developers or the Qt developers?
Live today, because you never know what tomorrow brings
Declare the maximum number of devices = 6 and maximum number of platforms = 2. 1 smartphone, 1 basic.
That solves 99% of the problems which Nokia have created for themselves.
Whether their smartphone platform was Symbian or Meego wouldn't have mattered, the R&D organisation would have been able to concentrate on actually making it good.
Their problem was not Symbian. Their problem was and still is 150 (yes really) different phone models. Elop hasn't actually fixed the problem.
Now like all Windows OEMs, they're a box shifter, so they need to get into a box shifter mindset. R&D will have to go entirely, there is no place for it in a low margin box shifting business.
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