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June 24, 2011

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Boris

N9 was presented because of contractual obligations to Intel (and it's not even true MeeGo, it's Meemo 6 with MeeGo UX). Then he leaked WP7 phone which is in N9 shell just to calm down buzz around N9. Then his interview in Helsingin Sanomat.

I know this is not financial blog, but after N9 announcment, Nokia's shares rose, and after WP7 phone leak, it continued to sunk.

And today we found out that Compal will produce first Nokia WP7 phone!

Yahoo! Finance posted "Ten brands that will disappear in 2012" article, and yes, Nokia (and SE) is on the list.

And you Tommi said carriers hate dual SIM phones. Well, Nokia just presented one three days ago.

P. S.
WP7 phones' prices totally crashed in Germany.

Vikram

"If you honestly want my opinion how to fix Nokia overall, read this from before the Burning Platforms debacle (its all about the marketing and execution); and if you want to see how to try to fix it now, here is my best advice for Nokia's Board of Directors. But fire the Microsoft Muppet now. He is doing nothing but damage to the Nokia corporation."


Actually Nokia screwed themselves with bad management for 5 years since the iPhone 1 in terms of why the company is where it is. Same issue with RIM. Both companies management dropped the ball and now are dealing with the consequences.

Saying that it is about "marketing and execution" is the main fault of management. "Execution" problems are a big issue when you can't develop a credible OS after 5 years and only now coming out with a MeeGo phone which is only superficially good - too little, too late.

Elop is a convenient scapegoat - 5 years of Nokia (and RIM) mismanagement did this - they couldn't keep up with the times.

eFlop

N950 is Dali, and it is not going to be sold. Only available to Nokia Launchpad developers and 250 units to Meego Community device program.

https://www.developer.nokia.com/Devices/MeeGo/
https://meego.com/community/device-program

Martin Altmann

While your sentiment is appreciated, all this talk about little boys being spanked on their bottoms is quite unprofessional - not something I would expect anybody interesting in projecting any sort of credible image would ever indulge in. I know this massive debacle must be hard on Finns, Nokia being what it is in Finland. But it is still unacceptable.

On topic: It's hard to argue that Mr. Elop hasn't exactly ridden on a wave of reinvigorating success so far, nor that it seems that his strategies, as communicated before the last change of heart, are misguided. But it is also very hard to argue that this is somehow all Mr. Elop's fault. Nokia has been losing their formerly formidable position for years, dying the death of a thousand little cuts, and we are many who believe stronger medicine was required than just a bit of "marketing" and "execution" fixing. Whether Mr. Elop's medicine is right ultimately remains to be seen, although I'll be the first to admit he's not off to a good start with all this.

But even so, the ultimate responsibility rests with the Nokian board. Those guys, led by the same Mr. Ollila whom you back as a homecoming queen savior of Nokia, have stood behind Elop in all this, happily seeing disaster after disaster unfold. If Mr. Elop is to blame then surely all of them are to be blamed even more. It is the board's ultimate responsibility to relieve an incompetent CEO of his authority, when all is said and done.

@rodrigottr

Dear Tomi

You was right about MeeGo being ready since last year. You was right about finnish design and american leadership (and Elop's delusions, so). You was right about how catastrophic would be to announce a new OS on february.

You said some of this even before 11 February

Now you say Elop falls. I bet you are right.

But I want to understand why the board let him do all those ridiculous things? Did they wanted to show those stockholders from the end of 2010 how right was the Symbian, Qt, MeeGo strategy letting Nokia be driven by Microsoft as many has claimed as the solution?

bamalam

@Vikram - even with years of poor management before Elop turned up on the scene everything there was still to play for in smartphones as Nokia had a clear transition path ahead as Tomi has outlined numerous times. It had everything lined up such as Qt, Navteq, NFC, Ovi and MeeGo to transition users at the high end from Symbian to a newer platform which was under their control with their revenue stream. It was a sunk investment worth billions. The burning platform menu destroyed that and the market for Symbian phones overnight. It was a particularly destructive action that is solely the responsibility of Elop and the Nokia board.

However although I think Tomi's analysis is terrific I don't think he gives sufficient blame to the board for the WP7 decision. They are culpable as well.

I think with MeeGo Nokia could have a tablet platform and even a netbook platform along with a simplified mobile phone range that would be easier to produce. The N9 shows what they are capable of and it is an excellent product.

Ironically in western markets an N9 plus an N950 style device would cover a lot of bases if added to by a newer tech phone with HDMI out and Micro-SD card.

The N9 shows real innovation and is near perfect otherwise. I believe there is even the missing FM functionality that just requires software to activate. Tomi please let us know what you think of it.

Earendil Star

Dear Tomi, thank you again for your insight and for collecting these pearls of... foolishnes by Steven TH Elop.

However, I continue to believe that little of what TH Elop did was due to incompetence. He simply misjudged the fact that his real plan could backfire as severely as it did, killing Nokia much faster than planned.

His memo, I still believe, was just tactics: he knew the platform was in trouble but not burning, but he needed others to believe it was burning to convince them that WP was a good idea.

I did not want to comment on Meego previously, because I had not seen it, but now that we can study the N9 in action, I believe it is fairly clear that the product was strong -contrary to what many believed- and this raises two questions:
1) why did Nokia need WP (the weakest phone OS around)?
2) why was the launch of the phone delayed?

The only plausible answer, the only that I believe makes sense, is the simplest one: the agenda being pursued was not Nokia's but Microsoft's.

The most ironic thing is that all the work that went into Meego thanks to many (now fired) engineers will benefit WP (Elop's own words). So MS is not contributing with anything, it is even leeching Nokia software capabilities (Meego), rather than the other way round as many believed.

So Nokia is now contributing to Microsoft with: Maps, Ovi, Software (Meego), ads, search, etc. etc.... how should this make any sense at all?

How this was allowed by Nokia's shareholders remains a mistery. I hope they are finally realizing what they allowed TH Elop to do, and that they will take action, but, unfortunately, I am afraid this farce will continue.

And it troubles me to think how many people were damaged because of the decisions taken in these few months (employees, engineers, developers, etc.).

Sad.

@rodrigottr

Oh

And your words above was the ultimate spanking of Elop WITH Steve Ballmer. (Because I credit to him all this stupid strategy and poor execution)

Microsoft's platform is burning and I'm very happy with that as you said. The Evil Empire is falling.

And I have another question:

Could be all this a movement of the Board to put Microsoft conspiracy on evidence and then prosecute Microsoft in billions??

am I delusional? cause I really can't understand the board on all these facts. They silence just don't make sense.

Eurofan

Tomi, I hope you will keep up this blog. I know Nokia is only one company among many in your area of interest, but I think the Nokia business story is fascinating and I can not read enough about it. So please keep up with the Nokia updates. I live in the US and of course I see the excitement with iOS and Android here. High end phones are the new cigarette and the new sport car. They fill time and make you look cool when you are feeling unsure of yourself. But at some level they are also devices which are changing the way people live and interact. I do not believe the American hype about the importance of being first to occupy business "space". MySpace was first and they have lost to Facebook. Facebook may lose to someone else in the future. So much American hype has to do with stock promotion. I'm sure many of my fellow countrymen have made just as much money betting against Nokia on the way down as they have made betting on Nokia on the way up. Whenever I see pictures or reports of Elop he is hyping something, like a bastard version of Steve Jobs. But when Steve Jobs hypes something, it comes out the next day. When Elop hypes something it may never come out. Does he spend any time managing? It seems the same managers who were inept for the past five years are managing under Elop today. Anyway,

I hope Nokia can succeed with Maemo/MeeGo. I think the idea of an "open source" operating system has an inherent fan base among technical people and from a dedicated fan base lasting market presence can be established. I watch from a distance, but I suspect the N9 wasn't as ready on in February as it is now, and I suspect N9 is still not completely ready. Another thing about Apple, their stuff does work smoothly as advertised without glitches right from the point of introduction. They say the N900 was delayed to fix some things. Still it was incomplete and glitchy. The N9 should be held back until it is ready to work as smooth as butter right out of the box. Then let the public decide if they want to spend that much money to support an "open source" ecosystem based on European ideals. I would buy one, but I haven't even the money to pay for phone service, so I've turned off my old Nokia and communicate through GMail.

Nokia clearly became a poorly run business after its initial success in the 2000's. It's a fascinating case in business history. I wish the company all future success. I wish Elop would shut up with his presentations and get back to fixing the management structure of his company. I hope the N9 is a success!

EM

Nokia needed to be cut and burned. Given that the state of MeeGo is, apparently, excellent switching the OSs was the wrong call.

However Nokia had 6200 people on Symbian. Spending five times on R&D what Apple does. So—OUTSIDE OF THE SWITCH—Elop is doing things right. Symbian is being outsourced. Useless R&D and useless people are being dumped.

That MeeGo UI? Written in nine months under Elop. What the hell was Nokia doing before that? So yeah, MeeGo looks great now. But the team needs a year to be rebuilt given their incredible collection of previous failures.

So yes, perhaps, WP7 is the wrong choice.

But Nokia gets: a) complete access to all of Bing stuff worldwide, and Bing is slightly behind or slightly ahead of Google on all the useful features, b) access to to MS's ecosystem and if Nokia drove the right bargin they can carry that to MeeGo after, say, a year, c) two to three billion dollars.

Nokia gives up: a) $15/handset, b) Ovi maps (although they get Bing maps as well), c) loss of Symbian marketshare which, let's be honest, doesn't matter that much in terms of profitability in the long term and no, marketshare doesn't matter, d) and a major decline in stock price which is ultimately pointless (Apple was at $15 in 2001).

Could Nokia have cut a broad-ranging service only agreement? (Ovi maps for Xbox, Bing, Office 365, Skydrive, etc…) Perhaps. Might have been better.

But understanding that the new MeeGo UI was written in nine months? Given all of the MeeGo teams complete failures in the past? One can easily understand his choice.

EM

Oh, right, and this isn't even MeeGo. It's a MeeGo API compatible version of Maemo 6/Harmatten 1.2 with a from scratch in nine months UI layer.

It's an interesting collection of zombie parts, not even MeeGo.

Tomi T Ahonen

Hi all!

Wow, already 10 comments? And in Finland Kauppalehti's forum has already also picked up on this story. Thanks guys!

I'm tired, I gotta go take a break. I did write also the melancholy revised lyrics to John Lennon's "Imagine" (a song which by the way, when I was young and that song was a hit, I used to think it was the most silly utopian rubbish ever written haha) with the theme 'Imagine there were no burning platforms.. its easy if you try haha..'

I'll be back a bit later tonight to start the comments here, but please keep the discussion going. I find great support from you readers that you find enough value in my writing that you bother to leave comments for us here. Thank you, really. I will be back to comment to each of you individually.

Tomi Ahonen :-)

@rodrigottr

@EM

We don't know if the UI was written in Nine months under Elop's leadership.

What I saw was Marko showing the N9 just like Steve Jobs shows some new product that changes everything. He showed the MeeGo powered N9 very differently then the "experiment for further disruptions" as Elop said about MeeGo 4 months ago.

Marko presented N9 as the new bet of Nokia while Elop said it was almost nothing.

Now if Elop had took the leadership of N9 project then why wouldn't himself showed it? And why would he say nothing about MeeGo's future? Self sabotaging?

For me it is pretty clear that Marko was one of the leaders of MeeGo project which Elop was trying to abort but couldn't.

And to me is clear how Nokia is divided on two visions: Open-sourced autonomy of MeeGo versus Slavery to Microsoft.

And now the MeeGo vision group just showed their full-hand while Elop has nothing yet.

eFlop

One of the Harmattan engineers refers to the last 9 months in this blog post, but it is unclear if that's when the development on the UI started. I'd say it must be older than that.

http://konttoristhoughts.blogspot.com/2011/06/respect.html

@rodrigottr

@EM @eFlop

Perhaps someone with better knowledge could explain us what does this means: "It's a MeeGo API compatible version of Maemo 6/Harmatten 1.2 with a from scratch in nine months UI layer."

As I understood the N9 OS is mostly Qt running over a Linux MeeGo engine.

So it doesn't make much difference if it is running MeeGo or Maemo, since both, even Symbian can run Qt, right?

eFlop

At least the application packaging format differs. Meego uses RPM (was used in Moblin). Harmattan uses DEB (was used in Maemo). Harmattan is not fully Meego compliant. http://wiki.meego.com/Quality/Compliance

Arjan Van De Ven, Intel's Meego architect says that Harmattan is not Meego.
http://lwn.net/Articles/448590/

Also the Harmattan Swipe UI is Nokia propietary closed source code.

Roo

Elop felt a need to have immediate impact on Nokia, territorial pissing so to speak, to prove he was in charge and in control. He accomplished this through partnering with MS, made him equal to his ex boss who telling how smart he is for doing so, it impressed his board without he billion of $'s it meant, and admiration from the press for his strength and decisiveness of leadership.

His other choice was taking the slower, less flashy, and harder route of recreating a system that executes assists effectively. But that does not get your name in the press, nor the self congratulatory meetings with the Ex boss, nor the instant recognition from the board. Not to mentioned being a salesman by nature they are not process oriented, they do not care about the storm just if the ship made it to shore. They focus on outcome not process.

As a previous manager, he has been a care taker of a successful product, a caretaker if a process at best. Looking at the problem of Nokia, it overwhelmed him. He want a great idea that would solve it. An idea that was so good, process would take care of itself. Enter Ballmer and him saying going with WP7 is a no brainer, with the dollars of MS support he could assure Elop success. All it would take is a couple of years of transition and they both be golden.

And even though it may not have been the right idea to give up on what they had and go with WP7 it still could have been successful. But only one problem Elop could not even develop a effective process to manage the transition. Which has left him with the stated "confused schizophrenic" behavior.

Roo

Another example of Eflop's "confused schizophrenic" behavior is the introduction of the N9, follow by showing the same phone with Wp7, effectively killing the buzz for the N9 (and the little positive press recently) and any would be excitement of the WP7 phone when it is released in 4 months.

@rodrigottr

@eFlop

And how much fragmentation would happen if Nokia's Meego go on market against Intel's MeeGo?

I've heard even android apps could be easily ported to MeeGo. So how damaged would be this to a hipotetical echosystem of MeeGo, if there is one?

NS

--> I did write also the melancholy revised lyrics to John Lennon's "Imagine"

Then you'll love this: http://brianshall.com/content/nokia-rhapsody

eFlop

@rodrigottr

Nokia and Intel have been focusing on different areas of Meego from the start.

Currently Intel has mainly been interested in running Meego on tablets and netbooks. They will be more interested in handsets when phones based on Intel's Moorestown (Atom) chips appear.

Nokia has been working on support for ARM based phones.

They both have been working on their own versions of UI components. "MeeGo UX Components" (QML) vs. "Meego Touch Framework" + qt-components

They both have their own app stores for Meego software, Meego AppUp for Intel and Ovi Store (or whatever it will be called) for Nokia.

So there certainly is fragmentation between these two Meegos, but as the APIs are mostly the same, porting applications between them is very easy.

Android apps can be run in Harmattan/Meego without modification/porting using Qt based third party software called "Alien Dalvik" by Myriad. http://www.myriadgroup.com/Device-Manufacturers/Android-solutions/Alien-Dalvik.aspx

While the android apps can be run in some way, I don't think they can be seamlessly integrated to the system.

E. Casais


May I suggest one possible reason for the apparent swings in the message delivered by Elop? Cultural impedance mismatch.

When I read the "burning platform" memorandum, I thought that the document was overwrought with hyperbole. The typical rubbish that a North American manager would put forth in order to galvanize his troops with a "salutary shock".

There is one problem though: So far, Nokia had been led by Finnish managers, whose style was never characterized by a surfeit of fiery figures of speech. When somebody like
Baldauf, Ala-Pietilä, or Alahuhta stated "we have a serious problem", then press, industry, customers would assess the situation exactly as spoken out: a serious problem.

And this is precisely what happened in February: everybody took Elop's rhetoric at face value -- Symbian is worthless, Nokia's ecosystem doomed, its legacy useless, its experiments in Meego and Maemo fruitless, its product portfolio at end of life, there is no alternative than WP7, etc.

From this viewpoint, Elop is now only adjusting to reality and keeping a more subdued, balanced expression when describing his corporate strategy. There is such a thing as a corporate culture, and Elop (who made his career in the USA) is realizing this -- but the damage has already been done.

I disagree that he is backtracking on the WP7 commitment though: the Symbian outsourcing agreement with Accenture has been just finalized; the WP7 phone was leaked at about the same time as the N9 was presented; and whatever happens with N9/N950, we are talking about sales figures of 5, max 6 digits overall -- a rather symbolic endeavour for Nokia.

Now the real question: what on earth were the members of the Boardm(presided by Ollila) thinking when they vetted the "burning platform" memo?

fucykou

and at the end of the days nokia will offer devices which are able to be installed or flashed by any OS that end-user wants. Qt with its technology could realize this soon or later and the only thing that still left is the WPx so they need somehow to "learn" it (since it's a closed/proprietary source) properly by choosing it as a primary smartphone OS.

Just wait and see... The final intention is, nokia doesn't create a new ecosystem with microsoft, they just learn it for a while and at the end they'll participate in all existing ecosystem. The hardware technology will become a final decision point (again) and not the software or ecosystem.

Nokia is or was a market leader worldwide, they should have this mind years ago.

eFlop

@fucykou

HTC recently announced that users will be able to flash alternative software to their phones.
http://www.engadget.com/2011/05/26/htc-officially-dissolves-locked-bootlader-policy/

Sony-Ericsson posted instructions how to build a linux kernel for Xperia phones.
http://blogs.sonyericsson.com/wp/2011/05/06/how-to-build-a-linux-kernel/

Microsoft will never allow anything like that.

eFlop

@Tomi

N950 (aka Dali) is already shipping to developers, so that they can develop on real hardware before N9 ships. The software is the same and there are only small differences in the internal hardware.

All the differences are listed in the following link:
http://www.developer.nokia.com/dp?uri=http%3A%2F%2Fsw.nokia.com%2Fid%2F3744886f-69c1-4544-8ad3-72b352b4a832%2FNokia_N950_OneClickFlashers_Release_Notes

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    Tomi Ahonen is a bestselling author whose twelve books on mobile have already been referenced in over 100 books by his peers. Rated the most influential expert in mobile by Forbes in December 2011, Tomi speaks regularly at conferences doing about 20 public speakerships annually. With over 250 public speaking engagements, Tomi been seen by a cumulative audience of over 100,000 people on all six inhabited continents. The former Nokia executive has run a consulting practise on digital convergence, interactive media, engagement marketing, high tech and next generation mobile. Tomi is currently based out of Hong Kong but supports Fortune 500 sized companies across the globe. His reference client list includes Axiata, Bank of America, BBC, BNP Paribas, China Mobile, Emap, Ericsson, Google, Hewlett-Packard, HSBC, IBM, Intel, LG, MTS, Nokia, NTT DoCoMo, Ogilvy, Orange, RIM, Sanomamedia, Telenor, TeliaSonera, Three, Tigo, Vodafone, etc. To see his full bio and his books, visit www.tomiahonen.com Tomi Ahonen lectures at Oxford University's short courses on next generation mobile and digital convergence. Follow him on Twitter as @tomiahonen. Tomi also has a Facebook and Linked In page under his own name. He is available for consulting, speaking engagements and as expert witness, please write to tomi (at) tomiahonen (dot) com

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