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January 13, 2012

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kevin

@Eurofan: Thanks for the response. My attempts weren't that long; definitely shorter than Earendil Star's above. I'll try again when I have some more time.

Guess Tomi wants us to keep comments to SMS size ;)

janne

A minor correction to Tomi. Both Lumia 800 and 710 uses WP7.5, not 7.0 as you claimed. So those phones support front facing cameras.

N900 owner

Hey Peter,

I don't thin my logic is flawed. Of course I don't have reliable data, but here in Germany Amazaon is selling the N8 fo 300€ without contract (place 560. in electronics). The Lumia sells for 450€ on place 328. But of course I don't know if these numbers are relavant on a global level.

Tomi T Ahonen

Hi Eurofan and all attempting to post comments but having problems

Obviously this is beyond my control, it is part of Typepad's system. I have the same problem and am VERY frustrated regularly to find, that my original posted comment to you all, seems to go through, but then does not appear. I have taken to doing a final cut-and-paste of my comment, and waiting two minutes, and if it doesn't show up, to return and post it in parts. That is why you see me often offer a part 1 and part 2 response to the same person.

Two issues I have noticed. One is the actual word length of the reply. I don't mind long replies myself, I prefer considered and complete debate, to superficial Twitter style headlines. But Typepad seems to not agree haha. So if you find your comment is long, please try splitting it into two or more shorter parts. Like Eurofan said, look at the typical longest comments here to see what seems to be Typepad's limit.

Secondly, there seems ALSO to be a time limit. If it took you a long time to compose your comment, Typepad seems to reject it. So even if you do the right thing, and edit your comment to keep it concise, then Typepad may penalize you for taking too long to post, and not accept your comment. Luckily on this problem a cut-and-paste re-posting is a rapid fix that is yes, inconvenient, but at least it seems to work.

I am very sorry, regular readers know I enjoy the debate here and would be the last to try to prohibit any legitimate arguments on any topics I have raised on the blog - and I try to have a lot of latitude with most comment threads to allow tangential topics too (unless with some blog articles, where I specify that I will tightly limit that discussion for usually rare topical reasons)

So yes, please keep the discussion coming, and I apologize on Typepad's behalf for their silliness, I would prefer there is no limit to the length of your comments (or my responses)

Thanks especially for Eurofan to give that reply to people who complained

Tomi Ahonen :-)

Tomi T Ahonen

Ok, more replies

Hi Volker, nic, Damir and jay (Karlim I'll respond to your longer comment next)

Volker - fair points, but I did mean to suggest two issues. The N-Gage was not just the world's first gaming phone - very brave move by Nokia and years ahead of its time considering the iPhone was the world's second gaming phone; and the N-Gage was the world's first pure consumer-oriented smartphone again years ahead of the iPhone. Two million smartphones sold today is indeed a failure by most handset makers but back then, two million smartphones was still quite significant sales. Nokia pulled the N-Gage because the carriers hated it, not because it failed the market. But yes, its market success was far below what was expected. What it did do, however, was to attract a lot of gaming content. That is clearly aged gaming content today, but it is a considerable library of ready gaming apps that do not exist on Blackberry or bada or Windows Phone yet haha.. But yes, good point, I did not mean to suggest N-Gage was a market success.

nic - I have a tight rule here on this blog that you have to have read the full blog article for me keeping your comments. I clearly said in my blog what was Nokia's chance in the USA market for Lumia, as well as for the USA market. But you do make a good point later on, so I'll let that slide.. :-)

About 'not intended for Brazil' or rest of world outside of USA. That is strictly not true. Elop said very clearly that Microsoft Windows Phone would power all of Nokia's smartphones soon. This year they will transition all phones to the Lumia line (if Elop remains in charge). These first three Lumias, 800, 710 and 900 will all be introduced globally soon, so they will come to Brazil too. And as I said, they will fail even more spectacularly in the Emerging World than in Western Europe.

When you say SMS precludes the browser, apps and games, nic, you really are not doing my blog article justice. I said VERY clearly in the blog, that smartphone users use SMS more than the browser or apps - I did not say that they only use SMS and don't use the browser or apps. This is exactly the STYLE of 'debate' I do not want to bother with on the blog. I never said smartphone users do not use the browser or apps, I pointed out evidence that even smarthpone users prioritize SMS ahead of those. You nic really have to read the article! This is a waste of the time of my readers (and of my time).

On the Japanese kids example, yes, that is possible. But the youth are the most knowledgable customers of smartphones and know exactly what they want. If their 'primary' phone is a messaging phone, they will then optimize the 'second' phone to be everything else ie big screen, great camera etc. The Lumia totally fails the second phone test. It is better than literally NO major rival flagship phone, not on even one criterion.

Damir - thanks! yes, totally true, localization.

jay - thanks. I took the specs from Nokia official website tech comparison and it didn't show it. I used the Lumia 800. I can't help it if Nokia themselves hide that ability haha.

Thank you all for the comments, karlim, I'll respond to you next

Tomi Ahonen :-)

Tomi T Ahonen

hi karlim (part 2)

Camera is the same thing. Nokia was pushing the envelope a year ago with the N8. It was a definite competitive advantage and still today the camera on the N8 delivers significant N8 sales - the N8 is one of two Nokia smartphones among China's ten bestsellers in December (The N9 running MeeGo was the other). Same as SMS, this IS a Nokia competitive advantage. Nokia has its Carl Zeiss partner and should have pushed the megapixel wars to 16 mp by now, rather than abandoning that advantage that now HTC can sell its Titan with that spec. It is inevitable that with Moore's Law the camera sensor capacity will increase over time. Nokia was a leader and known for this ability. With the Lumia Nokia is falling back into the pack, abandoning another competitive advantage, which today is more important to smartphone users than apps or the OS or the ecosystem.

On Look and Feel - karlim - you too! You know the rules here. You must read the article. I wrote CLEARLY that the Lumia looks good and has good reviews about its looks but even with that, it is failing the look and feel contest in two ways. Those who like other form factors, won't like Lumia. And those who really like pure touch phones, will go for the iPhone 4S as so far every tech review I have seen has also concluded. I did not say the Lumia look and feel has failed, only that it is not good enough to win for Nokia.

Tomi Ahonen :-)

Tomi T Ahonen

hi karlim (part 3)

Number of models, yes, 3 is better than 1. Yes, Nokia will ramp up obviously. But this was totally in Nokia's control. Why only a handful of countries in the formal launch of Lumia. Why a US-focused phone line is first launched in Europe where its form factors are particularly un-appreciated. This was all in Nokia's control (Elop's control). Last year when the N8 launched, it was launched globally within weeks. This is better than nothing but this is FAR below what Nokia should be doing. I am telling you and the readers - it is because the carriers are pushing back, they don't want it. They take Lumia only with reservations and then don't push it.

The 100K apps. And why would content like ringtones not be included, if Apple counts ebooks - equally content. I don't do the counts, I trust the companies who report on it. But there are not 500K 'applications' on iPhone either (or Android).

But I agree with you, apps will grow now faster on WP7 than Symbian and Nokia store (ex Ovi). That is partly due to the utterly unrealistic perception of the 'third ecosystem' but as the facts slowly filter into the developer community, that will change. When the app developers find that WP7 has far less than 1% of the global smartphone market and is at best the 6th ecosystem and by the end of this year will have perhaps grown to 4% of new sales (and much less of installed base) if Nokia does really well according to that very optimistic Morgan Stanley projection - the app developers will ask where is the other 96% or more. And they will shift their development staff and resources to Android, iOS, Blackberry, Symbian and bada..

Thanks for the long comment

Tomi Ahonen :-)

Tomi T Ahonen

Hi karlim (part 1)

First, sorry karlim for mangled order of the comments. For some reason no matter how much I tried to cut this first part, it would not post. So am trying AGAIN..

Thanks for the long detailed comment. About your missed comment, pls see Typepad above.

Now the issues. On SMS and good enough. Excellent point. Apple has done touch screen messaging good enough. In fact when tested, iPhone users who learn to type two-handed on the iPhone screen can outperform a standard T9 keypad (but not a full QWERTY). That is no doubt what Nokia tries with the Lumia. It is not my point. An only touch screen SMS experience by Nokia is neglecting a competitive advantage that Nokia has held. Nokia cannot hope to do the UI better than Apple or make the Nokia more sexy and desirable than Apple, those are Apple competitive advantages. But SMS is a Nokia advantage, and with the first 3 Lumia phones, Nokia has deliberately abandoned a competitive advantage! That is not a way for Nokia to win. It is a way where Nokia can at best tie. And judging by the rest of Lumia and Windows Phone today, Nokia needs every advantage it can discover.

Tomi Ahonen :-)

Tomi T Ahonen

Hi Titanium, Platform and cygnus

Titanium - you make a good point about the speed of development for Windows Phone. But that speed is irrelevant if WP7 fails to sell and doesn't get critical mass. Any analyst or developer or partner will give Microsoft (and Nokia) some time to let the new OS ramp up but WP7 will be 2 years old this year and the time is running out. If at the end of this year Lumia reaches the Morgan Stanley projection of 37 million units cumulative, that is 5% of new sales and less than 1% of the installed base. That is not good enough when WP7 goes into its third year. Apple achieved 15% in its first 3 years, Android 40%.

Platform - good points and we now see dual core CPUs already on several leading flagship smartphones coming from Asia. The Nokia flagships have always had this as a sore spot, even otherwise very good flagships like the E90 Communicator and N95 were underpowered under the hood.

cygnus - thanks. I think I did say it correctly earlier in the article. I need to go correct that. And on Elop and his numbers haha, that sounds very.. Microsoftian haha.

Thank you for the comments

Tomi Ahonen :-)

cycnus

@Tomi,

regarding the Lumina number, you might call what i said as microsoftian, but I know some companies did this too boost sales number when needed. and I believe that balmer will help nokia for this number, because if nokia looks successful, then Microsoft hope other will trust WP7 and buy it.

So, i think microsoft might be buying the devices from nokia, maybe around 1-3 million unit, put it as Q4 2011 result, and will be using it as giveaway in 2012, and as an offer for employee discount.

EK

(Thanks eurofan, Tomi & al. I’ll try splitting this posting in two parts as the original does not go through even though this does not seem as long as some of the replies earlier).

Part1:

Tomi, some counter counter comments to some of the issues.

1)

OK, be it then 20-25 % in mid/high level segment (I just never see those). It's still much less than 75 - 80 % and does not indicate high customer preference. I'm sure Nokia WP-QWERTY is coming ...

2)
On the contrary, on every tech-aware review they know that this is just the first from Nokia.

3)
Pointless to argue this. We clearly read, hear and see different things. Future will tell.

4)
Your underlaying main argument in general in this article (and also other) seems to be:

a) Nokia made a stupid decision on 11.2. This can be debated, but it is all water under the bridge. Only if WP-strategy collapses this will be revised.

b) The way it was communicated was the most self-damaging campaign in any industry ever (I completely agree, very very incompetent way of communicating the strategy change) and caused the big crash in market share (it was already severely declining in my opinion, but this made it much worse).

c) If Nokia had staid with original strategy (Symbian, Meego) it would have been more profitable during 2011 (I completely agree) and had bigger market share (agree)

Then you draw conclusion:

a) + b) + c) -> Windows Phone strategy can not work

This is simply a wrong and foregone conclusion. Nokia did not make the strategy change with 2011 or 2012 in mind. This big strategy change needs time to execute. It's a kind of miracle that Nokia has got so far with WP since 11.2.

We don't know yet what will happen. This is a darwinian laboratory experiment on Nokia but it does not _prove_ that it will have to lead to disaster.

EK

Part II:

7)
Again, it's almost a miracle Nokia had decent WP to sell at the end of 2011. They did not target to sell it 10 million pieces during 2011. As you know there was a big change in component chain with WPs. Also factories need time to adjust themselves. Both take time. Not all operators were selling WP earlier.

Now "a) + b) +c) -> you could have sold xx million more Symbian phones from own factories during 2011 with bigger profits".

True, but Nokia was not targeting for 2011 or even 2012 with the strategy change but all the years ahead. What we know now does not indicate a failure for WP strategy or that Nokia would have done something wrong with Lumia implementation. You can always question the decision but that is not the written topic of this article (although it is at least underlaying).

9)
I checked now and it was a T-mobile salesman, not AT&T. See recent Nokia conversations article. Yes, somewhat biased source ...

If you respect opinion from UK, then how about The Daily Mail which gives all 5-stars to Lumia 800 ?

10)
Specs are not everything. N9 is neither a flagship by any tech spec (camera, display, processor, NFC was already in C7, ...) but still it is a wonderfull, desirable phone as such.

EK


Part III

11)

We simply don't know at this point. What I can see is that on vodafone.co.uk Lumia 800 is the best selling phone in business segment. Does not prove anything, but does not look bad either. There is only handfull of operators giving this kind of information from enterprise segment that I know of (Elisa is one of those btw., they don't have Lumia yet).

13/14)

To make a somewhat fair comparison, adjust for time for availability on market and for the geographical distribution. But even that is futile. Nokia did not aim to sell it in many-many millions during 4Q. They aimed to design, implement and introduce it on important markets in controlled manner on record fast schedule. That was the goal and that it was delivered is more than most expected. Just as a detail, if you look at some of the operators now selling Lumia it seems to be the first WP ever there, contracts & training etc. were needed. Many things needed to gain momentum.

Lumia 800 will propably sell the around 1-1.5 million during Q4 (Nokia will never tell this I'm sure, they did not even tell N8 numbers although it according to most analysts sold around 3-4 million in 2010Q4)

And again this does not prove:
" a) + b) +c) -> WP strategy will never work and Lumia is going to be disaster"

ps. any reference on the ten most sold smartphones in China ?

LeeBase

Nokia used to make phones with great keyboards and that was one of their competitive advantages. I guess we aught to expect Nokia to again come out with models with great keyboards.

But, given that the best selling smart phones NOW...do not have keyboards....then it can NOT be said that the Lumia's will fail to succeed because they don't have a keyboard.

RIM has the worlds' best keyboards, and their marketshare is plummeting.

So much for the necessity of having keyboards no matter how important texting is.

Such has been obvious for years now...that it needn't have been included in your analysis of the Lumia at all. Nor should it ever appear in any future analysis of what is needed for success in selling smart phones.

Lee

Prasenjit Bist

Hello Mr. Tomi,

Day by day ur blogs are becoming the cry of a looser a man who has lost connection to reality. I can prove that all 13 points u said about lumia to fail are false and ur personal biased opinions.
Just let me give 2 3 examples( i can't write 1000 lines it hurts )
1. Lumia not designed by Top Nokia designers. Who is Anton Fahlgren, Axel Meyer etc the industrial designers they are the seniormost and most talented. Axel was the head of N series Design.

2. Lumia not built in Nokia factories. sud i sent you a Salo made Nokia Lumia 900. did not u see the live feed from Salo during Nokia World. Are u eldar murtazin's friend and go for dope together and then make up Nokia rumours.

3. Lumia is not coming with Nokia components like CPU. u said that when did Nokia designed CPUs. Nokia dictates optics , certain ICs used in RF and optics etc etc but no matter whether its Nokia N95/ Nokia Lumia 900 components are sourced and assembled at Nokia factories.

4. No Qwerty phone elop missed. whooa Tomi so happy jumping like a ass. Man its only 3 products in the portfolio wait wait hold ur breath..... more products coming.

5. Lumia not good design missing blah blah blah... but N9 gud why bcoz it has that meego okay... listen old man lumia and N9 are built with minimalistic design they removed everything thats a phoney and then u have a design every one loves including arch Nokia critics.. its a one piece body with minimum openings . How many use HDMI how many people use other craps.....

6. Nokia 710 feels platic yes its a basic windows phone available in US for $ 50 on contract.

7. Stephen Elop made a colossal mistake by making those symbian comments... which comments the ones that you guys created. still yeah elop made mistake and he must rectify and pay for them i agree.

Please get a hot bath then a cup of coffee and take deep breath, sit down on ur sofa think with a calm head a decision has been taken the bullet has left the gun.... now do not look back wat has been done or sud not have been done... think how Nokia can come back..and I see Nokia making a strong come back another point You said Nokia will face retail boycott with dual sim.... fyi Nokia sold millions of dual sim within 3 months and lead the segment in India....

Ed

Nokia betrayed legions of legacy customers in the last years, by insistently failing to give an acceptable level of customer support and ‘at least’ operational Symbians in hands of the high end users. The last models were a bunch of bugs and mistakes, missing everything on a critical transition phase to the not-so-known W7 platform. I suspect millions of those users already migrated to Android and Iphone after the series of frustrations with the last Symbians. People that loved Nokia, loved the past, and that will NEVER forget the depth of the betrayal in the last couple of years with cheap quality, ambiguity (curiously Nokia was never ambiguous, and now it’s part of this Company as the W7 manufacturer says “Living the ambiguity” is part of that culture), and now it’s too late to bring them back. Sad story of a great Company that made history in cellphones 10 years ago.

Tomi T Ahonen

Hi Ben and nic (will do Earendil separately)

Ben - thank you very much for the kind words. You can see that from my side, I am flabbergastered that Elop is doing all this (and being allowed to do it, by the Board). At some point it should be obvious, that he is just causing so much damage, he has to go. Even if for some reason the Board felt that the Microsoft strategy is 'wise' for example to try to get to the USA market, then clearly Nokia has not abandoned MeeGo and is still creating new Symbian devices now, so its about time to re-evaluate. I hope the Q4 numbers will finally wake them up..

nic - the 'high end' is not incompatible with QWERTY. Even in the US market there are premium Android smartpohnes with slider QWERTY keyboards and the USA is the severe laggard in mobile including messaging. QWERTY is not synonymous with cheap.

On the sales commission, yes good point. Except did you know that Microsoft was the only platform for which the sales reps received no commissions before? That was one of the many gripes the carriers had with Microsoft. So this is not any kind of competitive advantage now, it is only catching up to what others are doing. But it will help no doubt.

Tomi Ahonen :-)

Tomi T Ahonen

Hi Earendil

First, thanks for the lengthy reply to many in the thread. A few points I'd like to touch on.

Obviously yes, the Nokia partnership is good for Microsoft but not the other way around as you say.

Very good point about the smoke and mirrors that Elop and the Microsoft style of marketing is known for.

On your fourth point, we'll know for sure tomorrow when Nokia reports, but the very alarming numbers are now coming from Nokia traditional suppliers like Texas Instruments and ST Micro - whose components go to traditional Nokia featurephones and Symbian smartphones - that their sales have been disasterously low for Q4 (component maker sales towards Nokia obviously) which suggests falling sales of Symbian - AND alarmingly, dumbphones at Nokia. We'll know tomorrow if that is the case.

On Lumia to be flagship globally - so so so true, sadly. We look at past flagships and even when Nokia falters (N97) they still at least designed great phones by their specifications even where the production and software let it down. The Lumia 800 is a pathetic flagship now, severely damaging Nokia's brand and competitiveness. The existing Nokia customers with 2 year old phones who come in now to try the Lumia, will be severely disappointed - and then will be lost forever to the iPhone or Android.

Great comments overall, 100% agree with you obviously. Cheers!

Tomi Ahonen :-)

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I appreciate your effort, you have share informative and also useful post here and people who are planing to get Windows to Nokia Lumia series they just read it once. I have using Samsung smartphones and I think Samsung now the new king of this industry.

Publisher 2010 Download

I see that the usual MS fanbois are praising the WP OS and the current THT Elop strategy, despite their arguments being debunked time and time again.
The problem is they always reply providing comments that are completely off topic.

outlook 2010

The camera utility is limited and restricted. Windows Phone 7 doesn't even support dual cameras (that came with 7.5). There are many application developer issues that are not supported - like the hottest area right now, Augmented Reality. Nokia's past flagship phones have proudly done AR, but not these Lumias. And there is no support for NFC. And you cannot transfer apps and various content via bluetooth etc. The system is very restrictive and limiting.

Chris D

Just wanted to say: great article! It seems Lumia has sold more than one million devices in Q4, so it is far, far short of the 6.4 million you were looking at. (We all know that "well over" means nothing, unless there is a clear number.) See http://www.engadget.com/2012/01/26/nokia-releases-q4-2011-earnings-report-operating-profits-drop/
There are more bad news: Their operating loss was about $1.3 billion. And they are selling fewer Symbian phones than expected

outlook 2010

There have been many commentaries of the issue, perhaps the best direct response was by Don Reisinger at eWeek. He gave 10 reasons why Windows Phone will fail. His arguments are very good, but they are somewhat USA focused and still do not tackle some of the biggest reasons why Windows Phone - and Nokia Lumia - will fail. Lets take this issue logically, reasonably and with facts, not just conjecture and opinion and hope and hype. And lets start where most sensible marketers start, not from the product but from the consumer. What is it that we, smartphone buyers, want. And readers, this is again one of those ultra-long Tomi Ahonen essays, about 16,000 words (more than a full chapter in a hardcover book) so go get yourself a good cup of coffee before you start. It will probably take you half an hour to complete this article but I promise you, it is stuffed with facts, stats, insights and go

Microsoft Office for Mac Home and Business 2011 Download

Reason 3 - Look and Feel is not competitive. Nokia Lumia has gotten good reviews for its appearance but nothing beyond that. And by its one form factor alone, it will not win many converts, but on the abandoned other form factors, and its lack of typical Nokia elements, it is a downgrade from what Nokia has been in the past, and yet is not competitive with rivals today.

cheap nike air max

Nokia has taken its customer base and walked it in front of a firing squad, and shot it dead. Destroying 75% of its customer base in three year! This is corporate suicide. This is a hara-kiri by the CEO.

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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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