Remember that scene from Monty Python's Holy Grail, where the cowardly one of the Knights of the Round Table, Sir Robin, is at a cross-roads, and in one way are signs to 'Certain Death 1 km' and every sign in that direction is 'Certain Death 1 km' while the opposite direction is the road to 'Camelot 54 km' back to safety and his friends.
In real life there rarely is a situation of a genuine road to certain death. Even in some very dire military situations, like say when German General von Paulus found himself encricled by the red Soviet Army in the city of Stalingrad, that was not yet certain death. Hitler promised relief and to supply von Paulus via air, as the German Luftwaffe did try for a while. When do we see a clear road that leads to certain death? Even in management it is very rare to see certain death on a given path, and while many paths lead to eventual death, the path may be lucrative from a business point of view for years before death becomes imminent. Look at the VHS vs Betamax battle of video cassette recorders. Sony was arguably on a road to certain death when the VHS alliance gained a clear upper hand, but Sony milked its technology leadership, and sold premium quality Betamax VCRs for many years further.
(NOTE - this story has an update, see bottom of story, it is marked. Three significant developments directly related to this story)
The Road to Certain Death is mostly a mythical road, one that has very rare real life examples. Sure, taking heroin as a drug is probably a Road to Certain Death, but that would be on an individual level. As an organization, a company for example, is very rarely on a clear, genuinely 'Certain' Road to Death.
Nokia is on a Road to Certain Death, right now.
Lets be very clear. I am not saying Nokia should go back to its misguided ways it had under previous CEO Olli-Pekka Kallasvuo's leadership. I am not saying Nokia was 'fine' before Elop. I am not saying Nokia's old Symbian OS is somehow competitive today in all markets and could 'save' Nokia. I am not saying Nokia's handsets are world-beaters. I have been very critical of Nokia long before Elop came to town. I was fully on board with the strategy to shift away from Symbian - before Elop came to town! Yes. I was fully on board with Nokia's strategy to shift away from Symbian, before my vocal blogs here calling for Elop to be fired. It is not about a return to how Nokia was, nor is it about somehow a silly return to Symbian as Nokia's main platform.
This is about the Road to Certain Death. We have the facts now, we can see, the evidence is indisputable, that Nokia is on a Road to Certain Death. Right now. Nokia will not survive this journey, if Nokia continues on this path.
Which brings me to the quotation I thought of that is appropriate. Its the definition of insanity, attributed to many famous people like Benjamin Franklin, Mark Twain and Albert Einstein. The famous quotation is "The definition of insanity is to do the same thing over and over, and expecting different results." I understand that the real original source of that quotation is from a mystery book "Sudden Death" by Rita Mae Brown. If we know the current path that Nokia is on, is causing Nokia added pain - while that road leads to Certain Death - then it would be insane to even proceed along that path, while causing Nokia ever more pain. That would be insane. Insane for the CEO, insane for the Board, insane for the Chairman.
MASSIVE DOMINANCE OF AN INDUSTRY
So now the facts are in. The future of the handset industry is smartphones. Nokia invented the smartphone. Nokia had aggressively pursued its transition from 'dumbphones' to smartphones and was ahead of the curve, ie Nokia's internal handset sales migration rate from dumbphones to smartphones - was ahead of that of the global industry. The USA reached the half-way point last year, when half of all new phones sold were no longer dumbphones, they were smartphones. Europe reached that point in 2010, here in Hong Kong and other advanced Asia-Pacific region countries, we did that already in 2009. Worldwide, 32% of all new phones sold currently are smartphones. By this time next year, the world will be at half-point. Sony and Motorola will become the first traditional dumbphone manufacturers to complete the transition to becoming only smartphone makers, this year. Samsung, LG and the others, are all pushing hard to move from low-cost dumbphones to the higher margin smartphones.
Whatever Nokia might do in the low cost dumbphone sector, the future of Nokia hangs on its success in smartphones. So, what happened. Sixteen months ago, at the end of 2010, Nokia's market share in smartphones globally was 29%. Nokia was massively bigger than any of its rivals. Nokia in its smartphones alone, was more than twice as big as its nearest rival, Apple's iPhone. And regardless of what you may think of Nokia's 'obsolete' Symbian or its 'failing' appeal to customers, the facts don't lie. Nokia was growing unit sales of smartphones (actual smartphone handset sales) AND growing smartphone revenues, AND growing average sales prices of its smartphones AND growing profits of its smartphone unit, when Elop had taken charge, in the fourth quarter of 2010.
This is nearly unprecedented in any competitive global industry, where one global rival so towers over its rivals, that the nearest rival is less than half its size! Imagine if Toyota or Ford or General Motors or Volkswagen could have this awesome lead in car manufacturing. Twice as big as the next biggest rival! Imagine Airbus vs Boeing. Imagine Coca Cola vs Pepsi. Imagine Sony or LG or Samsung flat screen televisions. I dare you to come up with a global competitive industry where the market leader is that dominant. The only industry I can think of is the PC industry with Microsoft holding essentially a near monopoly, but that is no longer a competitive industry. Nokia has over 20 global Fortune 500 sized rivals making and selling smartphones. Yet Nokia was the genuine giant among lilliputs. I am not kidding you, try to find another global industry, where several Fortune 500 sized companies compete, where the market leader is twice the size of number 2. That is rare! And any CEO would love to be in that position, provided the business itself was also profitable. Twice as big as your biggest rival? Come on! That is the stuff of legends.
So understand the facts. Just over one year ago, Nokia towered over its rivals, so supremely, it is difficult to find current analogies to it. We have to go back in history, to say the 1970s when IBM towered over its computer-maker rivals known as 'The Bunch' for Burroughs, Univac, NCR, Control Data and Honeywell. Yes, just over a year ago, Nokia was literally more than twice the size of its nearest rival and .. Nokia was profitable .. and Nokia was growing its smartphone business enormously. Nokia's smartphone unit grew smartphone unit sales by 36% in the previous year. And yes, under Elop's leadership, in Q4 of 2010, Nokia's smartphone unit set a Nokia-record sized profit in the smartphone business. Anyone who tells you Nokia was in any way 'in trouble' or 'losing to Apple' or 'falling behind' in the smartphone races is patently wrong and clueless about the global races in smartphones. In the USA yes, Nokia was nowhere. China is a far bigger smartphone market where Apple's market share was puny and Nokia the dominant one. And so forth. When you are TWICE the SIZE of Apple AND you are profitable - Boeing would love to be 'falling behind' like this in airplanes. Ford would dearly 'fall behind' Toyota like this. Pepsi would fizzle forever to be 'falling behind' Coca Cola at this rate. American Express would pay to 'fall behind' Visa at this kind of level. No. The only fact is, a year ago, Nokia was winning the war in smarpthones, nothing else is anywhere near the truth. Apple made the most profits, yes, but Nokia towered over Apple, more than twice the size while Nokia made Nokia-reocrd profits in its smarpthone unit - all this under Elop's new leadership. And don't talk to me about app stores bullshit. The only markets where Apple's App Store was a global success were those that spoke English. Try the bestselling app store in Chinese? Its run by Nokia, used to be called Ovi. What of Portuguese? Ie Brazil.. Ovi. What of Spanish, most of Latin America. Ovi. German? Ovi.
Nokia was winning in the smartphones races, and winning by a mile. A mile. If you still want to argue this point, then show me another global industry with many Fortune 500 competitors, where the market leader is twice the size of its nearest rival, and tell me that is somehow not winning? Nokia's smartphone unit alone generated 548 million Euros (712 million US Dollars) of profits. On an annualized level, the 2.8 Billion dollar profit level would qualify as the 175th most profitable company total profits on the Global Fortune 500 list for 2011 !!!
No, Nokia was not Apple. Nobody is. But this side of Apple, Nokia's smartphone unit in Q4 of 2010 was healthy, strong, growing massively, generating strong profits. And Nokia towered over its rivals at 29% market share. Any other CEO of almost any other industry, airlines, banks, garments, home electronics, cars, petroleum etc - would LOVE to be twice as big as its nearest rival, while making record profits.
That was just over one year ago. Then came the Elop Effect. CEO Stephen Elop took a lesson from the Osborne Effect. He not only repeated the tragic communciation disaster of Osborne, he even improved up it. He created in effect a series of Osborne Effects. Elop yes, Out-Osborned Osborne. (The Osborne Effect ruined the Osborne Computer company and is studied in MBA classes as one of the classic management blunders leading to certain doom, never to be repeated).
Elop then decided it was not bad enough, he then copied the Ratner Effect. But just like with Osborne, Elop further made the Ratner Effect worse, by not just calling his own products crap (as Ratner did, factually true, Ratner's jewelry was of lousy quality), Elop went further, he invented problems Nokia's products did not have, he in fact called his products worse than they really were. He out-Ratnered Ratner! (The Ratner Company almost died, and was saved by total rebranding and firing of the CEO. The Ratner Effect is studied in MBA classes as another of the classic management blunders leading to certain doom, never to be repeated).
What did I say about a Road to Certain Death? Nokia CEO discovered a map. On it there was not one Road to Certain Death, but two Roads to Certain Death. He decided not to avoid one or the other. He decided to take BOTH of the Roads to Certain Death. Again, readers, I did not invent the Osborne Effect. It caused Osborne Computer company to go bankrupt. I was not the only one who looked at the Elop Effect and saw it was clearly the modern era most blatant copy of the Osborne Effect - and by every measure, it was stupid of Elop to embark on that mission. It was idiotic. There was a clear road-map to that path. It was a clear Road to Ruin. He decided to take it.
And worse, the parallel and equally damaging Ratner Effect. Elop also embraced this method of destroying Nokia and he copied the Ratner Effect, not just meticulously, but he 'improved' upon it, he made it even more powerfully - destructive - to Nokia. Elop out-Osborned Osborne while also out-Ratnering Ratner.
WORLD RECORD DESTRUCTION
Nokia's Q1 results are out. Nokia's smartphone sales have utterly collapsed. From 28 million smartphones sold in Q4 of 2010, the industry has grown by 60% - if Nokia only held its market, it should now be selling 45 million smartphones per quarter (Apple's iPhone is projected to sell in the 35 million range, Samsung is expected to sell over 40 million smartphones this Q1). What did Nokia do in Q1? It sold 11.9 million smartphones. Nokia's market share that was 29% just over a year ago, is now 7%. Yes. Nokia has lost 3 out of every 4 customers it had just a year ago !!!! One year ago, Nokia was twice as big as Apple and three times as big as Samsung, its two strongest rivals in smartphones. Now, after the Elop Effect, Nokia has shrunk to one third the size of Apple and perhaps one quarter the size of Samsung.
Never in the economic history of humankind, has there been such total comprehensive collapse of a global market leader. Never. Ever. Ever. This is a genuine world record in market destruction.
Please understand what this means. It is literally a 'world record' in business. World Record means, it has never been done before. You loved Steve Jobs? Me too. He created world records in business excellence, in achievement. Apple now generates record profits for example. But Elop did the opposite. He created world record failure. Not just the worst CEO that Nokia has ever seen. Not just the worst management that a handset manufacturer has witnessed. Not just the worst executive that telecoms has ever had. Not just the worst President of any tech company, ever. No. This is a world record, the absolute most damaging actions by the CEO of any Fortune 500 sized corporation in the recorded history of business corporations. A world record at management failure.
Again. Understand the context. Take the most spectacular global management disasters in recent memory. Think of New Coke. Think of Toyota's catastrophic failures with its brakes. Think of British Airways fiasco with Terminal 5. Think of the Tylenol scare. And of Mercedes Benz A-Series the car that was too dangerous to drive into curves. Think of the BP oil spill, or the previous global oil spill disaster, the Exxon Valdez. Never. Never in the recorded history of business, has a global market leader lost 75% of its business in a period of one year! I have been asking my readers to submit their worst cases they can remember, and we have not been able to find one instance of a company that was the global leader of its industry, which in a one year period lost even HALF of its customers, far less three out of every four!
And Nokia came to this situation not as a badly damaged weakling on the brink of collapse. Nokia was dominant, towering over rivals - many of whom were generating operating losses in their handset business like SonyEricsson, Motorola and LG - while Nokia's smartphone unit was vastly profitable - profits which alone would qualify at rank 175 of Fortune Global 500 in profits - and growing smartphone sales - while towering over its rivals like Apple and Samsung.
This has never happened before. Not in smartphones, not in overall telecoms industry, not in high tech, not in any industry ever. That the market leader lost more than half of its customers in a period of 12 months, that the market leader lost 75% of its market in a period of 15 months. This is a world record in management failure. Literally. A world record.
SNATCH DEFEAT FROM JAWS OF VICTORY
The market reaction has been brutal. Before the Elop Effect, in the first five months that Elop was in charge as CEO of Nokia, the Nokia overall sales grew, overall profits grew, the Nokia smartphone migration rate had progressed (from dumbphones to smartphones), the market share in smartphones was 29%, Nokia's smartphone unit sales grew strongly, the revenues of smartphones grew strongly, the average prices of smartphones set a Nokia record in growth and yes, the profitability of the smartphone unit jumped at a Nokia record. The investors of Nokia appreciated this new CEO so much, that they rewarded the Nokia share price with a climb of 11% in value in just 5 months. The previous CEO, Kallasvuo, had seen Nokia go from profits to losses, and seen the share price fall by 55% over a three year period and was fired. Elop had already in just 5 months, recovered one tenth of the value that Kallasvuo had destroyed. Elop was a hero.
Nokia's ratings by the three independent ratings agencies were all at one notch below perfect. Nokia was clearly on the come-back under Elop. The brand value of Nokia globally was ranked 8th most valuable brand on the planet! Not of tech brands, of all brands, by the Interbrand annual survey.
Then the Elop Effect. Since that fateful February, Nokia's climb-back in the share price took a suicidal dive. Last time Nokia lost 55% of its share price value over a 3 year period, and the previous CEO Kallasvuo was fired. Now Elop has once again proven he is the most incompetent manager ever. He has taken Nokia, and plunged its share value to lose over 60% in just 14 months! He destroyed more value, in half the time. Its like the famous US lite beer commercial, 'Tastes Great, Less Filling' Elop is 'More Destruction, in Half the Time'
Each of the three ratings agencies have repeatedly, consistently downgraded Elop's management and Nokia's future, from the fateful Elop Effect. They keep downgrading Nokia. All were at one notch above 'junk' status as of yesterday. Today Fitch is the first ratings agency to push Nokia to junk status. I am not a financial analyst (anymore) and this is not a Wall Street stock price related blog, but I would be curious to hear, has there ever been a global company of Fortune 500 size, that is the market leader of its own industry, in any industry ever, that went from such glowing ratings to junk in under 15 months? Has this ever happened in any public corporation ever? Elop is once again proving, he is the most incompetent manager any business has ever seen. Why is the Microsoft Muppet allowed to remain in control of this train wreck? I mean, we all saw he is pushing Nokia on that Certain Road to Death - three independent ratings agencies have repeatedly warned that Nokia is going down the wrong path, its future is ever more bleak. Why is this clown allowed to remain in charge?
Understand what that means. This is a World Record in Management Failure. It means, that no MBA book can give you a case study of how to fix this, no company has ever seen it this bad. No CEO has ever destroyed his or her company this comprehensively in this short a period of time. After I coined the term 'Elop Effect' as the combination of the Osborne Effect and the Ratner Effect, each which individually leads to Certain Death for the company, I started to call for Elop to be fired. And if your CEO establishes a world record in destroying your company's market, and thus a world record in destroying the viability of the very business itself, that to me is reason alone to fire the CEO (and to sue him!). But that is, really, yesterday's news. Because Elop was not done.
DEFINITION OF INSANITY
Remember that definition of insanity, doing the same thing over and over again, expecting a different result? Well. Look at Mr World Record in Management Failure. Elop wanted to prove he learned his lesson. He made mistakes, he knew how to repeat those mistakes. Now lets take MeeGo and the N9 and N950.
Nokia had been developing the MeeGo operating system to replace the Symbian OS. This development was started long before Elop came to town. It was built with the kind of Nokia integrity and attention to all partners and stake-holders, that while it was not the fastest or cheapest way to do software, Nokia built a 'migration path' for developers and apps built for the Symbian OS, to be ported to the new and technically quite different MeeGo OS. (This is something, that the selfish Evil Empire, Microsoft arrogantly refused to provide for Windows Mobile and now seems to again be screwing its developers and smartphone users where there is not a clear path from Windows Phone to Windows 8).
Both operating systems, Symbian and MeeGo were, along Nokia's long-standing principles, open source software (something again, Windows Phone is not), and both platforms had many rival handset makers providing handsets to it (like still in 2011, Fujitsu, Sharp and Panasonic were providing Symbian handsets; and for MeeGo Nokia and its partner Intel had signed up Huawei, ZTE and Panasonic among its many committed providers). MeeGo was even more friendly to developers as it was based on the Linux technology which has of course also lots of happy developers in Finland, home of Linus Torvalds, the creator of Linux. There even was the Qt developer tool environment, to allow development with efficient tools to deploy to all operating systems, past presnent and future, that Nokia supports from Symbian and Maemo and S40, to MeeGo, to even Meltemi of the future. Oh yeah, the only OS not supported by Qt is .. Windows Phone.
When Elop made his fateful communciation errors of the Elop Effect, in February 2011, there were no MeeGo devices yet in the wild, so we as an industry could not really tell if MeeGo could amount to anything. Since then we've seen netbooks like launched by Fujitsu in Singapore and now later in 2011 we had at least two handsets manufactured by Nokia, the N9 and N950, running MeeGo.
Symbian was definitely past its prime. Symbian, even in its best-selling incarnation the S^3 edition, was not on par with the iPhone or latest Android versions. When one looks at Symbian just as an operating system alone (even ignoring the Ovi store and other sides to it), Symbian shows its age. And a CEO of Nokia would be wise to consider moving away from Symbian. Like I said, this decision was made long before Elop came to town, and I have supported the decision to gradually move away from Symbian. It is no longer viable in the long term. But. We hadn't seen what Nokia can do with MeeGo.
Now we know. The N9 flagship smartphone (for you American readers, if you love the looks of the Nokia Lumia 900 - those were copied from the N9). The N9 is not just a highly rated Nokia flagship. It is not just rated better in every side-by-side comparison to any Lumia device. It is not just rated better than any contemporary Symbian device. It is not just rated better than any other Android or Palm or Blackberry or Windows Mobile or Windows Phone based smartphone. Most reviewers rate the N9 with MeeGo as good as the iPhone 4S - this has NEVER been achieved by any Nokia handset before. And better yet, many tech reviewers - not most, but many - actually rate the N9 with MeeGo as better than the iPhone 4S. Better than the Jesusphone? I do not make this stuff up. That is the honest actual tech review opinion coming from markets across the globe.
I am no longer a programmer and am not competent to evaluate the intricacies of software or of an operating system. All I can do is report the facts. But every previous Symbian version based smartphone by Nokia, was rated consistently 'not as good as the iPhone'. Every Lumia review I have seen, says it is 'not as good as the iPhone'. But most N9 reviews rate it at least as good as the iPhone, and many indeed, for the first time in Nokia's history, rate the N9 with MeeGo as better than the iPhone!
Note also, that Nokia did not stop the development or production of the MeeGo OS or its handsets. Two actual smartphones running MeeGo are currently in production, the pure touch screen version N9 and its QWERTY sister variant, the N950. So in terms of management decisions, there is no 'either or' decision here. Nokia had decided to go ahead and produce the MeeGo OS, and to manufacture two smartphones using it. And they are in production today. There is no significant savings now to try to shut down this MeeGo unit.
And consider the market reaction. As good as the iPhone? Motorola would die to get that kind of reviews. Sony would give the baby of the Playstation for that kind of endorsement. LG would be happy to rename the company iLG if it got that kind of reviews. Nokia gets these not 'occasionally' but regularly. The reviewer in Germany for Der Stern weekly magazine, was so enthusiastic, the magazine recommended German readers should travel to another country like Austria or Switzerland to buy the N9, it is that good (and was not being sold in Germany, where Nokia tries to push the Lumia series to unwanting German customers). An independent review site of smartphones has the N9 with the highest statisfaction levels of any smartphone on any brand.
If you want to save your company that is generating a loss, this is your key. MeeGo is the savior of Nokia. The N9 is the hottest smartphone on the planet right now. And what does the smart CEO Stephen Elop 'I know how to out-Osborne Osborne' do for his encore? The day after the N9 was launched (and Nokia's dramatic share price decline had reversed into its first significant climb for months) Elop tells the biggest Finnish newspaper, Helsingin Sanomat, that even if the N9 is a big success, there will be no more smartphones from Nokia running on MeeGo !!!
You own the most desirable handset and the most praised operating system since the original iPhone. You have the press of the world singing praises to this device. It is that good, that the media even suggest customers fly to other countries to go get one, its that good? Never, has Nokia had this good a reception for a new phone. Nokia the biggest company in handsets. Never in Nokia's history. And the CEO then jumps on the story, kills it by declaring it is Osborned. Even thought Nokia has spent years developing MeeGo and it is clearly a superior OS to Windows and Symbian, arguably the best out there right now, Nokia's CEO kills the story by Osborning it.
The definition of insanity is to do the same thing over and over, and expecting a different result. The management of CEO Stephen Elop is the Certain Road to Death. He is proving it consistently in his behavior.
THE RAZOR MOMENT THAT WASNT
The last time the global handset industry had a phone so overwhelmingly loved, was the original iPhone in 2007. But that is not a good point to compare, because Apple started with zero market share and grew from there. The previous time the world of handsets had a superhot global hit phone product by an incumbent handset maker, was the Motorola Razr in 2004. This is a lesson we should study a bit. This is what could have been. This is what should have been. In fact, this is, what might still become. HelloMoto, Razr.
So yes. Motorola was once the world's biggest handset maker. In 1998 Nokia took that title from Motorola, relegating it to second place. That MotoMoto held till 2004, when Samsung passed it, and MotoLozr was ranked 3rd in the big global tables. Motorola's quarterly sales of handsets was 23.3 million for Q3 of 2004, and its market share 15%.
Then came the Razr, the hottest mobile phone on the planet. In one year, powered by the Razr, we saw the MotoRtrn and handset sales exploded to 38.7 million at the same time 12 months later (a 66% growth) while Motorola's market share recovered to 19% and obviously MotoMoto recovered its second place ranking pushing Samsung back to third. That growth continued to 2006, when at Q3 exactly 24 months after the Razr was launched, Motorola was selling 53.7 million handsets per quarter and had 22% market share - and now people were seriously saying Motorola may dethrone Nokia in the top. All the while, powered by a highly desirable Razr line, Motorola generated enormous profits while growing strongly and capturing market share.
That is rare in telecoms. It is rare for you to have a legitimate global hit product. It is very rare. My only point here is, that when you do have a hit product, like Nokia right now has with the N9 and MeeGo (and its sister phone, the N950) - you do not suppress its sales! Only a complete moron would kill that sales success. Only an Osborne sized Ratner-brain would prematurely terminate the sales success of this product! But that is what Elop did. He out-Osborned himself! He now promised the global telecoms market that no, no matter how great the N9 and MeeGo will be. No matter how much Nokia customers may love the phone and its features and operating system. He, the CEO will not allow those customers to ever experience that kind of bliss again. He will personally forbid any future sales of subsequent phones running on MeeGo.
Nokia has never had a hit phone like the iPhone or the Razr. But Nokia now sits on such a phone, the N9. It has had the most favorable early reviews and actual end-customer user reviews of any Nokia phone ever made. It is the Razr of today. Nokia could, just by selling the N9 alone, grow Nokia's total smartphone sales something like Motorola did with the Razr. Even if we only use one N9 and use only the Motorola Razr as the comparison, it would mean not shrinking Nokia smartphone sales by 39% in one quarter! But by growing Nokia smartphone sales by 66% this year, and more than doubling it in two years. Not by generating massive losses in the smartphone unit, as Nokia now does pushing the utterly undesirable Lumia series - a smartphone series so poorly designed and so lousy in consumer experience, that it is setting a Nokia record in return rates by dissatisfied customers. But the N9 would propel Nokia to profits, so big profits that if it was just released to all Nokia major markets - who are begging for it from the UK to the USA to Italy and France and even India - that action alone would return Nokia's smartphone unit (and all of Nokia corporation also) back to profits.
??? you are now confused? Yes. You understood correctly. Even as the world loves the N9 and wants it, the delusional dictator Elop refuses to release the N9 for sale in most of Nokia's biggest markets!!!! He only allows it to be sold in tiny markets like New Zealand and Singapore and in some countries of the Emerging World like Nigeria. Even with that, the analysis of Nokia Q4 results revealed that the N9 outsold all Lumia phones - by 3 to 1. Nokia was very careful to not reveal the needed data now in Q1 results, and I am sure it is still true, that the N9 is outselling the whole Lumia line. Elop is ashamed of that fact, yet his ego is what drives this equation. Elop's Ego is now killing Nokia. Rather than take the profits and market share recovery that the N9 and MeeGo would provide, Elop rather sees Nokia producing 'surprising' losses and issues profit warnings and cannot provide long term guidance to investors.
NO YOU CAN'T HAVE IT, SILLY RABBIT
If anything makes me weep, it is the sister product to the N9, the N950. The N9 is a typical 'iPhone clone' in its form factor, a touch-screen slab format handset. Its like the various Samsung Galaxies and Sony Xperias and other smartphones that litter the handset stores. And at least, while not in every market, it is sold somewhere, if you are lucky enough to find it (Hong Kong apparently was too big for Elop, he did not allow it to be sold here). But what of the N950? It is a QWERTY slider format smartphone running MeeGo. It is the latest in the long line of 'Communicator' super-premium top phones more aimed at business users and heavy texting youth, that the Nokia fanatics love, from the original 9000 Communicator to the 9500 Communicator to the E90 Communciator to the E7 of last year. Because of its form factor, it first of all would have a huge installed base of hungry loyal Nokia 'Communicator' users who would welcome that form factor smartphone (like me!). Secondly, there are no near rivals from Apple's iPhone or Blackberry or many other handset makers! So there is a clearly addressable market, where there is NOT an overabundance of competitors. Nokia would have most of this market segment to itself. Better sales, less competition, clear differentiation, an established loyal even fanatical user base, less need to discount the device - means more profits!!!!
There is no management decision to be made here. The phone does not need to be desgined. Its parts don't need to be ordered. Its factory tooling is not needed to be made. The N950 is being manufactured, today, in Nokia's own factories, in small numbers. Its literally 'good to go.' Nokia could mass-produce the N950 starting Wednesday this week, if Elop allowedit, and using Nokia's airplane-based shipping, could be in your stores next week Monday in any country of the world!
There is no conceivable 'savings' from 'not producing' this phone. Its not a hypothetical project somewhere, that would require tons of R&D and production costs to finish it. It is being made! Yet.. Elop refuses to sell it! Anywhere! For this reason alone, Elop is a criminal who should be fired (and sued) (..and tarred and feathered). Nokia could stick almost any price on that superphone and ship it to its major markets and it would be the darling of the tech press and tons of CEOs and tech nerds would want it just to show, how cool this new MeeGo based superphone from Nokia is. But No. Elop again has out-Osborned himself. Its not just that he said at the N9 it will be the end, he then took the N950 and said, even though Nokia manufactures this device, Elop refuses to let it be sold. The definition of insanity is to do the same thing and expect a different result. Elop is once again acting deliberately against Nokia's best interests with the N950.
I mean... What weird alternate universe is it, where Elop's brain lives? Its the kind where Captain Kirk finds Spock wearing a beard, and the crew of the USS Enterprise as evil torturing sadists. Nokia has not one, but two globally superhot phones, and one it only sells in tiny markets, and arguably the better phone, the one that goes 'beyond an iPhone' or being perhaps, the 'if you could have an iPhone with a QWERTY slider real keyboard, this would be it' superphone, the N950? And Elop refuses to let it be sold, anywhere. Yet Nokia factories do produce it in small numbers to hand out to some developers. I kid you not. If Elop was the biggest failure in corporate governance, this stunt alone justifies a whole chapter more of the idiotic dictatets of the Microsoft Muppet.
Because we know why this is happening. Even though the market wholeheartedly rejects the Lumia series running Microsoft Windows Phone software, Elop is still pushing it. Elop is not looking after Nokia's best interest. He is acting against his fiduciary duty, clearly in the cases of MeeGo, the N9 and N950, Elop has a conflict of interest where he took actively the position that is in Microsoft's best interest (suppress MeeGo sales) and against Nokia's best interest (reducing Nokia profits and overall smartphone sales success, to say nothing of Nokia loyalty and customer satisfaction).
Lumia evidence is now compelling. The sales channel hates it, the customers are returning the Lumia in record numbers. The independent secret surveys of in-store sales staff behavior, from Nokia's home country of Finland (where Nokia is revered) to Microsoft's home country and best market, the USA, the surveys of handset stores have revealed that the store staff are reluctant to sell Lumia to customers, even when they ask for it by name!
When your reseller channel refuses to sell your product, you die. Let me repeat that. When your reseller channel refuses to sell your product, you die. And what has Elop got to do with this? He has caused a reseller revolt, and then made matters worse, all through last year and into this year. It is so bad, his global head of Lumia sales just quit. When your top sales guy of supposed the 'savior' product, the Lumia smartphones - quits, that means there is no salvation coming in the form of Lumia sales this year. I calculated that for every reluctant Lumia customer converted by Nokia, it loses 4 to Samsung or Apple. Nokia is bleeding loyal customers now, yes 4 out of 5 existing customers refuse Lumia so comprehensively, they churn to Apple or Samsung. And I dare say, if in smartphones, you lose a customer to the iPhone, that customer is gone for life. This is a certain Road to Death. Why is Elop allowed to ride Nokia further down this Certain Road to Death. Is it not a definition of insanity if you repeat the same action and expect a different result? If the resale channel refuses to sell your product, you die. This is a Certain Road to Death. Why is Elop allowed to remain in charge of Nokia?
I could go on. I am not suggesting Nokia was in perfect health before Elop. Nokia was in dire straigths before Elop came along, and all of Nokia corporation was plunged into loss-making under previous CEO Kallasvuo. Elop came in when change was needed. Elop precided over his first 5 months of a remarkable return, powered by Nokia's smarpthone unit. He also inherited the future amazing success of the MeeGo software and the N9 and N950 (and likely others) handsets which actually reversed Nokias sales decline in Q4 and the 1.75 million N9 smartphone sales even in those obscure markets it sold, actually pushed Nokia to a modest recovery in smartphone sales for Christmas. Note, the sales of the first two Lumia phones in the same period, in Nokia's best markets, with the biggest marketing push ever seen by Nokia and supported with such fantastic gimmicks as free Xbox 360 gaming consoles to buyers of the Lumia 800 - yet Lumia sold only 600,000 units in Q4 - the N9 alone outsold both Lumia by 3 to 1. Even now, in Q1 of 2012, the three launched Lumia phones including the launch in the USA, managed only 2 million Lumia sales. This while Nokia smartphone overall sales collapsed 39% in the same period (falling 7.7 million units in just one quarter!). Yes. Nokia traded 9.7 million Symbian based customers for 2 million Lumia customers while gifting 7.7 Million new happy users to the iPhone or Galaxy. This you call leadership? This is total comprehensive market failure, a world record destruction of a brand. And Elop is in charge. He needs to go. No. Not go. He needs to be fired. Now!
Nokia is more than smartphones, it is also networks (a business unit that is perennially in trouble) and dumbphones (which now form the bulk of Nokia's handset revenues - a sad state of affairs, Nokia has truly regressed. While Motorola and Sony achieve total migration from dumbphones to smartphones, Nokia reversed itself, and is now killing its smartphone business to apparently become only a low-cost dumbphone manufacturer with ultra-slim profit margins at best. Hon Hai of Taiwan better known as FoxConn the manufacturer of the iPhone has profit margins at a razor-thin 3%. Is that what Nokia investors want? When Elop took charge a year ago, the profit margin of the smartphone unit was 12.5%)
Nokia had bloated bureaucracy, yes. Nokia was slow in adopting new technologies and slow in using its own innovations, I agree. Nokia had notoriously delayed product delivery schedules, the N8 smartphone was literally delayed by a year. I have been critical of all that, long before Elop came to town. Elop was hired to fix these kind of 'execution' issues. But even here, it would be the top of the product line, the smartphones, that help boost the desirability and appeal of the whole line. What is happening in dumbhpones? We have not yet heard the official number from Samsung, but the trends are pretty unavoidable, it has happened, right now in Q1 of 2012, that Samsung has passed Nokia now to become the world's biggest handset maker overall. Nokia's reign as the world's biggest handset maker has come to an end, an inglorious achievement by CEO Stephen Elop who torpedoed Nokia's market share in less than two years of his leadership.
So even if you thought Nokia could compete in the dumbphones segment, Samsung has eaten that cake too. Before the Elop Effect? Nokia was 50% bigger than Samsung in total handsets and generated bigger profits in the handset unit. Today that is all lost. Today even the total handsets division of Nokia (dumbphones and smartphones combined) has been plunged into loss-making, thanks to Elop's mismanagement. This while Samsung reports record profits in its handset unit.
WHEN EVERY BIT OF NEWS IS BAD
Nokia has set a world record in destroying its market share in the future of the business it invented, the smartphone business. A business so lucrative, it drove Apple to become the most profitable company on the planet, but Nokia now produces record-level losses in its smartphone unit. A year ago Nokia was bigger than its two biggest rivals combined, now its less than a third the size of either. Nokia has managed to frighten away 75% of its loyal customer base in less than 15 months, establishing a world record in the obliteration of a loyal customer base. This has also resulted in Nokia abandoning its leadership in the overall handset industry. So how is this performance then rated?
Nokia's ratings by the three independent ratings agencies have been repeatedly downgraded. Two have Nokia at the last level above Junk, one has already classified Nokia as Junk. Nokia's share price has been in free-fall falling more than 60% from the recent peak under Elop and at least for Nokia this is the fastest and biggest drop it has ever seen in any 14 month period. I am not enough of an expert to know about Fortune 500 sized companies, if this is a world record in share price collapse. But when Nokia's share price fell 55% over 3 years, that was so bad, Kallasvuo was fired. Now its fallen over 60% in 14 months. The Nokia brand has been so tarnished, it has fallen out of the top 10 global brands and fell to the rank of 14th. I forget how many billions of dollars of brand value Interbrand calculated were wiped out by that drastic fall.
NOT LEARNING FROM HISTORY
I discuss a lot of the mobile industry history here on this blog. Its partly because I so strongly agree with Winston Churchill who said "Those who fail to learn from history are doomed to repeat it." So Elop, Elop, Elop. What have you learned? Not much it seems. His predecessor, Olli-Pekka Kallasvuo's management had a long line of smartphone releases that featured production problems and bugs. The N97 was a dog of a phone. The situation with the N8 was so bad, Anssi Vanjoki had to personally step in, and delay its launch several times because of prevailing problems in early phones. This was something that was supposedly fixed by the time Elop came in. So, then Elop in his infinite wisdom promised that Lumia series smartphones would be delivered in record time.
I did warn on this blog that pushing such fast delivery dates threatens the quality of new Nokia phones. It was exactly the problem that had plagued Nokia quality and eroded its reputation. So I said that some of Elop's early Lumia phones might have production problems. Now we see massive catastrophic problems with each of the first Lumia phones. Each of them. The 'flagship' Lumia 900 had so big problems in the USA and Canada, that Nokia had to resort to a 100 dollar rebate coupon. A 100 dollar discount on a phone that costs about 400 to 500 dollars in its unsubsidised price? Thats a 20% to 25% instand cut in its revenues. It kills any profits that Nokia made! And each of the first three Lumia phones had massive problems from battery issues to wiped memories to freezing handsets. This was predictable, but Elop doesn't know the history.
And what of those price cuts? Elop's predecessor, Kallasvuo, was fired partly when it emerged that as a market share boosting gimmick, he started to buy market share, artificially boosting Nokia share with unsustainable price cuts. A price war in effect. And what is this we hear of Lumia? The whole series has seen drastic price cuts while the oldest Lumia phone is less than 5 months out of the gate. What is wrong with this picture. This is what the previous CEO was fired for, but Elop happily proceeds once again on the path his predecessor walked, and was fired for. What did Winston Churchill say? Those who don't learn from history are doomed to repeat it. Elop is repeating mistakes his failed predecessor did. How utterly incompetent is this dude?
CERTAIN ROAD TO DEATH
I have shown that Nokia was a strong company, rated one notch less than perfect by all three ratings agencies, in the first 5 months Elop was in charge. Nokia was not 'cured' of its bureaucratic and execution problems, but Elop was working to fix those. Then came the Elop Effect and Nokia collapsed. Since February 2011, Nokia management has repeatedly made blatant - foreseeable - failures and errors. I have only mentioned a few here in this long blog. I could list dozens more. It doesn't matter anymore. We have seen that Nokia is now on a Certain Road to Death. Nokia market share was 29% when Elop started. Look at this trend:
Q4 2010 - Nokia smartphone market share 29%
Q1 2011 - Nokia smartphone market share 24%
Q2 2011 - Nokia smartphone market share 15%
Q3 2011 - Nokia smartphone market share 14%
Q4 2011 - Nokia smartphone market share 12%
Q1 2012 - Nokia smartphone market share 7%
You do not need a Ph D in advanced calculus to notice that this indeed IS a Certain Road to Death. If you are an optimist, you can project Nokia to have 4% at the end of this year. If you are a pessimist, you may think Nokia has 2% at the end of the year. This is how Palm died. This is how Siemens died. This is how Motorola, Died. This is a Certain Road to Death. The collapse of Nokia is now so overwhelming, nothing can resurrect it, if Nokia proceeds on this Certain Road to Death. The sales structure, the shipment systems, the supplier chain - Texas Instruments (a Nokia major components supplier) has seen catastrophic collapse of their business, down 60%. This is completely unrecoverable no matter what kind of silver lining you may think or hope that Lumia and Microsoft Windows Phone might provide, or that Windows 8 haha..
WHEN YOUR SALES CHANNEL REFUSES TO SELL YOUR PRODUCT
There is a reseller boycott against Nokia. I have chronicled it, it started at the Elop Effect, it was clearly fore-seeable. Some don't like the word 'boycott' - so fine, if you want to use the term 'reluctant to sell' that to me is the same thing. You say Tomato, I say Ketchup. I call it a reseller boycott, the reluctance of the global handset reseller channel to sell Nokia branded smartphones. I have explained why it exists, that does not matter now. It has been both independently proven by surveys in stores from China to France, from Finland to the USA.
Microsoft's own Windows Phone management has admitted that the carrier relations were bad for Microsoft before last year, and Microsoft itself made matters worse last year. This is not open to debate. It is a fact. Nokia itself has admitted - including several times Elop himself - that there is reseller reluctance to sell Lumia (and various other admissions of the channel refusing or reluctant to sell or stock Nokia). This is not an issue open to debate. It is a fact. I may have been providing the background facts to it last year, as it was happening, but now it has been verified by Nokia itself, Elop admits it and singles out the UK market as particularly unfriendly to sell Lumia. That is the market you'll recall where even Xbox 360 gaming consoles were tossed into the package to push Lumia. Yet the UK hates Lumia so much, the review by the Guardian went to the extraordinary step of saying they can't live with the phone, and returned it, encouraging its readers to do the same. I do not make this up, this is what the market says. There is no silver lining on Lumia. And Nokia, and Elop himself, admit the channel is not supporting Lumia sales. In the Q1 results, Elop talked of 'mixed' news about Lumia, some of the early reviews and rewards have been nice, but the resale channel comprehensively rejects the Lumia series, worldwide.
When the reseller channel refuses to sell your product, you die. This is the Certain Road to Death. And the definition of insanity? To repeat the same action again and again, and expect a different result. Nokia Lumia handsets are seeing Nokia-record returns from unsatisfied customers (while N9 scores highest known ratings of any Nokia handset ever).
I can understand that there was a lovely fairy tale, told by master story-teller Stephen Elop the Canadian dream-weaver, with the golden tongue. He promised that if Nokia went Microsoft, this Windows Phone would magically restore Nokia to strength. That was a nice dream. But while Elop and his golden tongue spin lovely stories, the tongue is in fact forked. He is a palefaced serial liar. He is 100% untrustworthy. He says anything he thinks you want to hear, and his words have no correlation with reality. He is the modern business equivalent of Dick Cheney and Donald Rumsfeld, if you remember, before the Iraq War. Now that wonderful fairy tale has turned into a nightmare. It is time to wake up. The Windows Phone road with Lumia is.. A Certain Road to Death. When the reseller channel refuses to sell your product, you die.
Nokia. You Die.
This road is a Certain Road to Death. It does not matter what all factors led Nokia to this point. It does not matter how much of the damage was already done by Kallasvuo before Elop, and how much happened under Elop. It does not matter how much of this current crisis was personally decided and executed by Elop as CEO. What we know, is that Nokia is currently proceeding on a Certain Road to Death. The market share in Nokia's future, the smartphones, is 7% now, and by the end of this year it will be between 2% and 4%. At that level the costs will be so overwhelming, Nokia crumbles just on those losses. This is Nokia's Palm Moment. This is Nokia doing the Siemens or being Murdered like Motorola. But it need not be. This could be Nokia's Razr Moment. Nokia could be saved. The main point of this article is - Nokia is currently - by EVERY bit of evideince - on a Certain Road to Death. This is a road from which there is no recovery. Nokia will die if it continues on this path. Nokia must take Any Other Road to try to survive.
Yes. Any other road. Nokia would be better off by abandoning Windows and going purely Symbian (I am not suggesting that). Nokia is better off biting the bullet, abandoning the Windows path and going full Android (I am not suggesting that). Nokia is better off being a slave of the open source Tizen alliance with rival Samsung and Intel, than slave to the hostile Microsoft dictatorship in the Evil Empire (I am not suggesting going full Tizen). Nokia is better off in any path other than the current one. Because the current path is a Certain Road to Death.
I have outlined how to save Nokia. It is a long blog article, but for those who are interested, it provides one path to success. I am totally confident, that by the early but incredibly strong love that the N9 smartphone with MeeGo is getting in all markets where it has been released, and in every comparison by reviewers who have used both, the N9 totally defeats any Lumia device - I am confident Nokia is sitting on its Razr recovery, with the N9 (and N950). Any sane CEO would look at Nokia's bottom line today, look at the high prices that the N9 gets (and looks at how high prices the E7 got as a proxy of what the N950 could get) and would immediately launch the N9 and N950 to every market now. The sane CEO would loudly and clearly recant that stupid statement that there won't be more MeeGo devices, because Nokia has several other handsets already fully ready for production that could run MeeGo now (such as the N900 and the N9-00).
As there is a reseller boycott against Nokia overall, and against the Lumia series in particular, any sane CEO would act clearly to end that, as his most important action. Why, because if the resale channel refuses to sell your product? You die. This is elementary, you don't need an MBA to see that. And the resellers the world over are refusing to sell Nokia Lumia specifically. Even Elop admits there is a problem. So why is he pouring resources to futire wasteful attempts like a tablet PC which is a costly venture that helps Microsoft but would hurt Nokia when it does not need this kind of silly distractions. The tablet PC market is totally alien to Nokia, its brand is not strong there, the reseller channel is different and unfamiliar, the pricing is different, the product have little in common and if all that was not logical enough, look at Motorola and RIM. A PC maker like Apple and Samsung can of course take advantage of strong synergies, to sell tablet PCs. But when pure handset makers like Motorola and RIM (ie Blackberry) have tried to sell tablets, they were disasters and drained much-needed resources and pushed their companies into greater losses !!!!
The Road lead by Elop is a Certain Road to Death. If Elop knew what he was doing, when the reseller revolt started last year, he would have acted to end it. Instead, he made things worse. He fired many sales staff (or they left 'for personal reasons') like in China and the USA. Now look at the latest news. Again, Nokia top Lumia sales guy, a 20 year veteran, who personally achieved 77% market share for Nokia in China in smartphones - the biggest smartphone market where the iPhone used to be an afterthought and Blackberry is not even recognized. This guy who knew everybody in the Chinese market, failed in restoring Nokia and breaking the reseller boycott. He just now left 'for personal reasons'. And the utter comprehensive failure of Lumia and Windows Phone from the Microsoft side is the same. The past head of Windows Phone was demoted. The current global head of Windows Phone marketing just left 'for personal reasons'. Windows Phone will never be the third ecosystem, because the carriers hate it, and they don't trust Microsoft, the Evil Empire. Elop attached Nokia's cart to the wrong horse. It is leading Nokia on the Certain Road to Death.
One mistake by a new CEO could be forgiven, even should be forgiven. Two mistakes, means you are being very understanding. But a dozen major mistakes in a year and counting? Massive destructive - and fore-seeable - mistakes like the Osborne Effect, the Ratner Effect, the second Osborne Effect with MeeGo, the refusal to sell N9 widely, the refusal to sell the N950 anywhere, the wanton angering of the reseller channel, the skapegoating, the incompetence of not seeing what led to sudden profit warnings, the feuding with carriers/operators, the biased preferential treatment of Microsoft over Nokia's own best interest, the silly tablet misadventure, and on and on and on. Elop has set the world record in management incompetence and he is now compounding that error. He must be fired. Nokia will not recover with the Microsoft Muppet in charge.
The biggest single problem Nokia now has, why its sales have stalled globally, not just in Lumia nor even in all smartphones, but even in dumbphones - is the reseller boycott. If the retail channel refuses to sell your product, you die. Elop has tried, for 14 months, to unravel that boycott. He has only made matters worse. He cannot fix this problem - because it is personal, the carriers don't trust Elop (and they don't trust Microsoft either). Elop is now the red flag to a raging bull. Nokia cannot recover its carrier relationships with Elop in da House. He has to be Gone as in Audi5000. Word! T-Dawg.
The resellers are mostly controlled by the operators/carriers. What Nokia now needs is a new CEO, Elop to be fired (he is not trusted by the channel, he cannot remain) but the replacement should come from ... the carrier community of course. One of the long-term veteran CEOs from the carriers, ideally from here in Asia where all in the telecoms industry accept, the global telecoms leadership resides. That would end the carrier boycott of Nokia sales essentially overnight. If the reseller channel refuses to sell your product, you die. If the CEO can't break the boycott in 14 months, he never will. If a new CEO comes from the carrier community, he has the best chance to break that boycott. And if the reseller channel just lifted the anti-Nokia and anti-Lumia boycott, that would stop the rot. That would stop the decline. I can't promise you it will restore Nokia to growth, but the decline would end. Nokia will be in a death-spiral as long as Elop is associated with Nokia. This is the Certain Road to Death. Any other road is better than this, even if the other road is only an uncertain road to death haha.
And what moron CEO sits on Nokia's best phone ever powered by Nokia's best OS ever, the N9 and MeeGo, and refuses to flood the world markets now with it, before the next iPhone and next Samsung Galaxy are launched soon? And yes, obviously, to run the N950 also to every markets now. Elop needs to be sued for his MeeGo and N9 (and N950) decisions alone. The definition of insanity is to do the same thing over and over, and expect a different result. Elop is allowed to pilfer and plunder Nokia's customer base, to ruin Nokia's carrier relationships and destroy Nokia's market value. It would be insane, to let him continue, and expect a different result. The Nokia Board would be insane to let Elop continue in charge, as Nokia rushes down on the Certain Road to Death.
If you want my thoughts on how to restore Nokia to growth, profits and health once again, please read this blog: Nokia can be saved.
UPDATE April 26 - There are two interesting stories out today that are very relevant to this blog. First, there is ex Nokia SVP Lee Williams who is also an ex Symbian executive, who gives very detailed insider info about the situation leading to Nokia's troubles today, and evaluates Elop and his strategy. On Elop leadership he writes Elop has stepped out and is now running after the bus. And Lee mentions that Elop is scaring away highly competent senior talent, while bringing in junior people from Microsoft, especially to sales. Please read the full article at CNet UK.
And there is news about the N9. If you still don't believe me that this is the best thing going, the British D&AD awards, the British Advertising and Design industry annual 'Oscars' just gave their top award to.. the N9. The N9 beat such illustrious rivals as the iPad 2 and .. the Lumia 800. And here is the heartbreaking part - the N9 won even though it is not sold in Britain! They love it that much, they selected it the winner of best design in Britain, even though the British can't buy it. Why is Elop not flooding the planet with this phone?
UPDATE May 3, 2012 - and the Nokia annual shareholders' meeting was held today. In it Nokia CEO explicitly acknowledges that there is a reseller reluctance to sell Lumia series (he also acknowledges a separate carrier boycott against all Microsoft phones due to Skype). Read all about it at News from Nokia Shareholders Meeting.
I am an ex-Nokia executive. I left in 2001 on my own accord as my first book was finished. I have no grude against Nokia. I am a Finn. I love Nokia. One of the phones I still use today is a Nokia E7 (the other is the Samsung Galaxy Beam, and when I feel like walking around with 3 phones, my third is a Mi-Fone). I was not fired by Nokia - quite the opposite, Nokia accepted my first book as an official Nokia book they sold on the Nokia website and Nokia has used me countless times to represent them at Nokia events internal and external over the past decade.
I am no weirdo on the fringes of tech. I am the most published author in the mobile industry. My 12 books are referenced already in over 120 books by my peers, which should tell you all you need to know how wacky is this Tomi Ahonen and his weird thoughts. I have been quoted in over 350 press stories in over 2 dozen languages including just about all the biggest press like Wall Street Journal, Financial Times, Business Week, the Economist etc. Forbes just ranked me the most influential expert of the mobile industry. Thats who I am. I am not writing this because I caught Elop sleeping with my wife (haha, a funny theory someone suggested once), I have never met the man. I was fully supportive of him for his first 5 months at Nokia, but after the Elop Effect, I determined that he is acting not in the best interests of a company I love, Nokia, and I have been chronicling his mistakes since. This is not a lonely crusade against Elop by me - I have been very vocal on this site before when I see any management incompetence or stupidity in this industry, such as Sprint Nextel when they started to fire their customers for complaining too much (I called for the Chief Marketing Officer and CEO to be fired, they eventually were when Sprint had lost half its share value in the PR nightmare aftermath of that obvious management blunder). And I have not been alone in projecting a total collapse of Nokia's market share by Elop's mismanagement, take a look at Horace Dediu's Asymco blog and its projections for Nokia under Elop and with Windows Phone. Its not a pretty picture that he painted back then, but Horace was obviously very accurate back in February of last year when he called this as madness by Nokia.
I want whats best for Nokia and after Elop got onto his rampage to sabotage the once proud company, I took objection to that, and I have been chronicling his mismanagement here on this blog. I am not partial to Nokia, I have also frequently given deep critical reviews of where I think Apple is doing wrong (they could be doing even better than they are haha, and I am calling them out on it) and how RIM is doing with Blackberry etc. But because Elop has made repeated mistakes, not just the occasional one per year, he does massive blunders regularly, he is also the subject of my blogs regularly. Its not that I repeat my stories here, every time Elop is in my blog, he did something new and stupid (or achieved something even more damaging, like today, the downgrade by Fitch of Nokia to junk status). I call it as I see it. I hope my readers can see from this blog, that it is my wholehearted desire to find a recovery for Nokia, to identify where the problems are (and are not) and find remedies to fix Nokia. You may disagree with what I suggest, but I hope it is clear, that this blog was written out of a love of Nokia not a hatered of it. But when the CEO establishes a World Record in Management Failure, that should be automatic cause for firing his sorry ass. The Microsoft Muppet? He has to go. Now.