Nokia needs an endgame for rebirth

Jouko Ahvenainen/Grow VC Group
02 Jul 2013

Nokia has made business history by emerging from the ashes in the 1990’s and now by losing everything in only a few years. Many have been skeptical about the Nokia – Microsoft cooperation for a long time, but now even the most optimistic must also admit the reality. It is time for an endgame. Now Nokia is acquiring NSN, is it the first move toward building a new Nokia.

Nokia’s problems started before current CEO Stephen Elop. Nokia had become arrogant. It thought Apple or Android would only be marginal things in mobile business. They thought the phone business had become mature, and that it was only about logistics, low costs and how to torture their suppliers. They didn’t realize that Steve Jobs had changed the rules of the smartphone game.

The Nokia–Microsoft co-operation has been a fiasco. Nokia has lost its smartphone market share, but so has Microsoft as well. Both companies have used a lot of money for marketing. The cooperation has now continued 2.5 years, and the partners have perpetually promised a breakthrough with the next version. We have also seen a lot of rumors about potential Nokia acquisitions by Microsoft, Huawei, Lenovo or someone else. And there are also rumors, Microsoft is disappointed in Nokia’s performance, and they want to build a better relationship with Samsung and other important actors.

Something must change. It's hard to believe the cooperation will continue without a revision for any more than six months. Microsoft’s fiscal year has just ended. Nokia needs better sales.

There are basically three options: 1) They decide to continue, whatever it takes, and it means Nokia is just a tool for Microsoft, 2) Nokia starts to work like an independent company and starts to support more operating systems and devices, and 3) someone acquires Nokia and maybe only utilizes its brand and sales channels.

Option #1 means Nokia’s phone business is not really an independent business, but it and Nokia’s shareholders are Microsoft's charity volunteers. Why they would do it; because Nokia has no strong shareholders or board to independently consider their gain.

Related content

Follow Telecom Asia Sport!
No Comments Yet! Be the first to share what you think!
This website uses cookies
This provides customers with a personalized experience and increases the efficiency of visiting the site, allowing us to provide the most efficient service. By using the website and accepting the terms of the policy, you consent to the use of cookies in accordance with the terms of this policy.