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« Decision Matrix for Nokia - Compare Microsoft Windows strategy vs Symbian/MeeGo strategy, side-by-side, by all relevant metrics | Main | Some Nanothoughts for an iPhone 5 World: Why Apple Needs to Split its Product Range in Smartphones »

August 02, 2011


Earendil Star

Tomi, thanks again for the insight.

Regarding Nokia's new numbering scheme, I'm afraid they are no longer contemplating what will happen three years down the line...


Tomi, Maybe Elop could just put his beautiful mug on the front of the new Nokia boxes with his email address and the tag line, if for any reason this phone fails to perform up to your expectations please let me know. Nokia stands behind every product it makes because we care about our natural, social and corporate environment and our customers. As far as the mug, I have the following one in mind for the "Great Listener", although he really should be in a Maoist jacket!

Anyway, what is your progam like as far as diet in the next few weeks of your vacation. I need to loose some weight or a bunch of weight would be more accurate in three weeks and my current duties are light enough that I could be described as being on vacation myself so I have time and will power to change my own food and beverage routines; the thing is my Mother is visiting in 20 days and I look like a cubical victim/internet startup hero: 45 pounds overweight and full onset of spinabiffida pseudomundus. Anyway, again old chap, cheers to you on your vacation and stay away from diet Coke; I hear that ex-marketing guy went back to Coke and they're going to start giving names to Coke products now, so regular diet Coke is going to be called "Charles"! Kind of scary when you think about it, and I'm trying to clear my head so that I can become more receptive to wisdom and self-censorship! No wonder these are called "the dog days of August." I remain your avid follower, Sincerely etc.,


tomi, android phones have the highest return rate. thats why samsung won't reveal its numbers. 15%-30% return rate is normal among htc, samsung, mot.
Complaints are
poor battery life,
too hot when gaming,
drop phone calls easily,
gps doesn't come with built-in maps and turn by turn,

Symbian can really come back to compete agaist android.

Nokia can run better without a CEO for months to come.

The only thing nokia need to do is to dump crap Elop now.


fire elop without granting golden parachute NOW
and hire a CEO LATER is absolutely okay for nokia and nokia board Chairman Jorma Ollila.


Peter, you clearly aren't an Android phone owner :D

really? No maps? How about Google Maps & navigation? Also HTC comes with their own offline maps (they have a deal with Route66).


And I thought Apple fans are crazy.

Where have you got this 15-30% "normal" numbers? There are hundreds of Android phones on the market so it's entirely possible that some have returns 30% or may be even more. But "normal"? Sorry, any salesperson will explain to you that 30% return product is sales loss product. You just don't sell it - if it all possible. And even 15% is problematic case.

Just as few days ago Tomi explained how high return rates lead to actual Nokia boycott:

And if "normal" 15-30% Android rates don't produce this effect then what does? 90%? Nokia is truly doomed then...


@virgil, most of android phones do not have built-in (offline) maps. With att/verizon cut 3G download size to 2GB/$15/mo, More and more users will complain and switch to Nokia N8/Meego N9. that's the trend. Esp. for us market, Navteq rules over telenav maps.

Android can not compete and win over nokia in the long run.
1. android lacks big patent portfolio ( OEMs face huge potential royalties charge from nokia, apple, microsoft );
2. android doesn't have built-in maps (when 3G download size become more expensive);
3. andriod apps are slow by using java VM that requires faster CPU, more memory which shorten battery life-span and becomes hot when gaming;


even "HTC comes with their own offline maps (they have a deal with Route66). "

1. its offline maps lack the life-time free update!
2. it might have eu maps but how about NA, ASIA maps ?!
3. online gps from google become increasingly expensive due to the limited network data flow per $15 !!!


I'm not sure you quite "get" Apple, Tomi. They came from nowhere and redefined the smartphone proposition, but for the last 2 years have been content to grow with the market. I don't think they ever intended for the iPhone to have the same degree of domination that the iPad currently enjoys. They don't make cheap products, and having consistent large market share growth beyond what they have done would require going downmarket. They haven't even entered China yet (and that gives them potential for one more massive boost), and I don't see them ever getting significant traction in some emerging markets where $30 phones are the norm.

The iPhone 5 will bring a nice pop in North America and Europe, but China will be the next major market, and so whatever phone that is (iPhone 5 or 6) will be the big driver. Beyond that, I see them holding steady or shrinking slightly to protect their margins.


Smartphone competition is about talents competition.

When apple worked with MOT for porting iPod to RAZR, apple learned whos were best talents in MOT and hired them later to do IPhone 1.

When google worked with apple to port google maps to iPhone, google learned whos were best talents in apple and hired them later to do Nexus 1.

Nokia bought a lot patents but failed in recruiting key talents. Nokia hired a crap who's destroyed itself within 5 months.

Patents and Talents rule in this bloodbath field.

Bob Shaw


Even assuming that you may be right about the bump Nokia received for couple of quarters from S3, the game is going to be quite different going forward.

In any given price segment, the differences in performance between iPhone, Android, WP7, Symbian, Meego are insignificant to an average consumer. These differences may be more evident to a minority of technical people but hardly matters in terms of sales. Remember iPhone did not care for the opinion of the technocrati, it marketed straight to the average consumer.

The success for any platform going forward will boil down to marketing and promotion to an average consumer. Verizon in US successfully propelled Android to match iPhone in sales with a $200M marketing budget. This was done by Verizon to compete against iPhone when iphone was only available exclusively at one carrier i.e. AT&T. Once Android caught momemtum in US, it got momemtum in Europe and than the rest of the world.

Microsoft is planning at $500M marketing campaign for its new Windows Mango based phone. Combine this with a $120M marketing campaign to be launched by Nokia for WP7. Once WP7 catches the eyes of the average consumer, any resistance (if it exist) to WP7 from Carriers will evaporate.

Marketing muscle is needed to carve out a space that is currently divided between iPhone and Android. The lack of traction to HP's WebOS and RIM's Blackberry is due to the absence of marketing muscle. Both of these do not have any Skype related carrier issue.

This marketing muscle cannot be provided by Meego or Symbian but by WP7. In fact Meego and Symbian will benefit due to more visibility for Nokia brand from this marketing blitz by Microsoft-Nokia for WP7.

DeeDee Cupsize

"tomi, android phones have the highest return rate. thats why samsung won't reveal its numbers. 15%-30% return rate is normal among htc, samsung, mot."

Wow! Those are horrible return rates if they are true. I know that all smartphones are buggy as hell nowadays. The service firms/people are complaining about the poor quality of the smartphones. All of them. They said that speed of phone releases are too fast and the phones are released to market too soon, before they have been properly tested and the numerous bugs corrected. There was a story in the news about that the other day.

DeeDee Cupsize

@Bob Shaw
"This marketing muscle cannot be provided by Meego or Symbian but by WP7."

Why not? It's just a choice from Nokia to market WP7 and not MeeGo. They could have and should have put that $120 million to MeeGo. And in fact they could have put more money to MeeGo marketing, if Flop hadn't made that idiotic MS deal, because Nokia would still be profitable and not making loss. Though they wouldn't need to put hundreds of millions to marketing since N9/MeeGo would sell itself so much better than WP7, if Nokia was just standing fully behind it.


@Baron95, Nokia has about $5B net cash in hand, why do you think Nokia needs to fastly sell NSN or patents to raise money ?

Symbian sales picked up in July and Android's momentum evaporized since more and more users realized the pursuit of cpu clocks and core do not make meaningful sense now.

With the lauch of Meego N9, nokia could make a small profit IF clown Elop won't make any show in whole Q3.

So Vatar

@ Baron: You write:
"*THAT* is why Elop got upfront payments from Microsoft ..."

I read that Elop said will be payments from MS to Nokia, however I could not find evidence that MS actually paid, how much they paid or how much they will pay. Can you point me to a source that shows such a payment, a source that can be substantiated?

Thanks in advance!


@So Vatar, thats so call marketing promotion money to be used for WP7.5 mango. $128M this year. Nokia can not use the money for any other purpose. Actually this kind of moeny transfer is near the brink of bribery crime. Look at the money transfer from intel to Dell, it is illegal.

Thats why we have to fire Elop now.


@ Peter: Agree with all your posts and points as usual except need to raise cash. Five Billion goes quickly and Navtek would raise some money (1-2 B) and could be "mortgaged" like Ford did with its factories after Tommy Ford Jr. threw in the towel and hired a professional engineering manager from an American commercial aviation company; that's why Ford is still independent of US and Italian government ownership today. Anyway I'm not saying Nokia has to pull the plug on Navtek today, just have a plan to put in on the block and start informally shopping it around. Better safe than sorry.

Peter: Your four reasons for return were golden nuggets, hugely valuable info in today's new Anna environment. Anna may not be so "easy" but she repays affection like nobody else and is practical. A twelve year old could design a marketing campaign for the E7 around those four return reasons, contrasting "dorky" looking E7 with "other phones" on those four points, eg all day at the beach, etc. Great info.

I heard this morning at the tire shop that new north am campaign for Nokia WP7.5 will be, "Easier to use than a pet rock." A Nokia WP7.5 and a Pet Rock will be shown side by side on bar counters and profession ex-athletes and reality tv celebrities will compete to see who can learn to use each of the two product fastest. This should be good for years of profitable sales and brand good will just as Miller Light Tastes Good vs Less Filling TV ad ran for 5 years, eventually giving way to Miller overall brand implosion not fault of the ad, brought about by general public distaste with filtered dish water beers and turn to micro-brews and "local" brews, eg Sam Adams ("Boston") and Rolling Rock ("PA"). Anyway, lets not think past three years, also the new order from above.

The Lankku is going to be sold to Herman Miller to sell next to Eames Chair as super profitable design statement, enduring value, no ad budget, etc. I read that every Eames Chair ever made is still being used today, somewhere. They can be reupholstered and new goose down stuffed into those timeless leather cushions (only foam stuffed cushions put in them today, believe it or not, without very special order to factory, so used H.M. Eames Chair is worth more than new, and we're talking a 3$ thousand dollar chair here new, folks. Charles Eames best friend was Eero Saarinen (Illinois Institute of Technology Campus, General Motors Research Campus, Yale Hockey Rink, Washington Dulles Airport terminals, MIT Chapel and MIT Auditorium; father Eliel did Helsinki Central Railway Station, Cranbrook Academy and was one of the giants in Finnish art history)).

Don't worry about advertising the Lankku, worry about supplying demand.

At tire shop I learned this morning that eFlop will be assigned to Navtek's new global warming/earth changes observation platform on a drilled out North Sea oil rig; supposedly this new super new Navtek project will launch this winter as "real time Earth Ecosystem data stream" or something like that with eFlop at the helm of the rig until he quits. No golden parachute for quitters according to contract. Golden parachute only if fired by Board, or something, that's the rumor.

Peter what is your dietary regimen? Your notes exude health. I have decided to cut back/eliminate carbs after breakfast. I tried this today and feel better but now my farts are fantastical. Yin and Yang.


So Vatar

My question was directed and Baron95 and I asked for sources that can be substantiated. I still have nothing tangible to show that MS has paid any amount.

I am an engineer by training, I do have strong opinions, but I want to base my opinions on verifiable information. Information like Tomi provides in his blog posts. I am sorry, but I think your following statement comes out of thin air: "thats so call marketing promotion money to be used for WP7.5 mango. $128M this year. Nokia can not use the money for any other purpose."

Or show me the source of this information!


@So Vatar, never saw your comments here before.
why do you want this kind of precise information ? it is biz secret as the exclusive partnership between MS and nokia.

you can simply google it by nokia windows phone marketing


Tomi, Since September 2010, I have been reading your Blog, congratulations to you and thank you for your time and your deep analysis.
But...Meanwhile Elop, like an Ultra Dictator, destroy any sample of history and identity in Nokia, and Nokia itself also!.
Where are the Nokia Board Members that can stop this "crime", and dismiss this cowboy!
The Nokia Board Members are aware of this catastrophic situation at Nokia?,
You know if they or any of them read this blog, and what they think of your analysis?.
It is very sad to be a spectator of the destruction of a company like Nokia!

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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 Helsinki 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 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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