Why Europe Is So Critical to Nokia in Smartphones: The Symbian S^3 Sales Pattern in Q4

IDC just reported yesterday that Nokia had fallen from 39% market share in Europe to 11% in smartphones, lost literally three out of every four customers they had in Europe just six months ago. The biggest in Europe in smartphones is now Samsung at 22%, with iPhone number 2 at 21%, third is HTC at 14%, fourth is RIM also at 14% and down in fifth place lingers Nokia smartphones at 11%. I suggested Nokia would fall globally to about a quarter of its market but that would take a year. They are failing much faster under Stephen Elop's misguided mismanagement and in their biggest and most profitable market they have lost in less than six months three quarters of their market already. The situation at Nokia is far worse than any of us could predict.

To give some more understanding of Nokia smartphones, I did a bit of very complex and time-consuming multi-dimensional optimization modelling on their quarterly results data and some other data points we have received. We can now paint a very accurate picture of what Nokia was like in Q4 of 2010, the last quarter before the Elop Effect happened on Feb 11 and destroyed Nokia's value.

This type of analysis was not possible until Nokia released its profitability information by division this July, but now we can calculate the actual contribution of not just overall Symbian handsets to all handsets of Nokia (previously some Nokia smartphones vs dumbphones info was only aggregated into one handsets unit). And why I can only do it for Q4, is that in the Q4 2010 quarterly results investor call, CEO Stephen Elop confirmed the sales number of 5 million Symbian S^3 handsets sold in Q4. If we had that official number for Q1 or Q2, I could do similar analysis for newer quarters too. But here is the full picture of Nokia smartphone and dumbphone sales.

So to be clear, we know as certain numbers the unit sales, average sales prices, sales revenues, and profitability of the dumbphones/featurephones (ie non-smartphones) and separately the smartphones. The smartphones side includes both older 'uncompetitive' Symbian S60 based smartphones, and the new, initially VERY competitive and user-friendly Symbian S^3 smartphones that were selling like hot cakes until the Elop Effect killed the success of all Nokia phones, not just Symbian S60 but S^3 and even Nokia branded dumbphones.

What we did not know is the split of Symbian S^3 vs older Symbian S60 in units sold, revenues, average prices or profits. We furthermore did not know the regional split of all the phone types dumbphones, and the two types of smartphones. But some patient multidimensional modelling will get the numbers as we have some critical data points added, the 5 million S^3 sales number and now the profits by divisions.

This is Nokia Q4 of 2010, the quarter when Symbian's new S^3 was released (led by the N8):

Type . . . . . . . . . . . . Units  . . . . . . ASP . . . . . . Revenues . . . . Profitability . . . . Operating Profit
Dumbphones . . . . . . 95.4 Million . . 43 Euro  . . . 4.1B Euro . . . . 11.5%  . . . . . . .    470M Euro
Symbian S60 . . . . . . 23.3 Million . . 128 Euro . . .3.0B Euro . . . .   9.3% . . . . . . . .   276M Euro
Symbian S^3 . . . . . .   5.0 Million . . 284 Euro . .  1.4B Euro . . . . 19.1% . . . . . . . .    277M Euro

All smartphones  . . . 28.3 Million . . 155 Euro . . . 4.4B Euro . . . . 12.5%  . . . . . . .    548M Euro
All Nokia phones . . 123.7 Million . .   69 Euro . . . 8.5B Euro . . . . 12.0%  . . . . . . . 1,1B Euro

So, how did the so-called 'failing' Symbian S^3 do then? It sold 5 million copies in one quarter - thats second only to Apple's iPhone 4 and far better than any other new OS version release, or new OS launch or new smartphone model line launched ever - including more sold than Samsung's latest Galaxy.

How did it contribute to Nokia? It jumped Nokia's smartphone average sales price so much, that Symbian S^3 smartphones earned on average 2.2 times more than other Symbian based smartphones. Nokia's new S^3 average sales price gets it in the price range of HTC and Blackberry (while still obviously half that of Apple's iPhone). Just as a note, Microsoft's head of Windows Mobile, Andy Lees, said in July to Microsoft developers that the average sales price of Windows Mobile based smarpthones is only 200 dollars (vs 284 Euros for Nokia's Symbian S^3 which is about 411 US dollars) and that would be down to between $100 and $150 next year. So Nokia had a huge growth engine in Symbian's latest S^3, which it swaps for an undesirable OS whose boss says their prices are being nearly halved in the next year. But I digress.

The profitability of Nokia's new Symbian S^3 is the most interesting tidbit - double the profitabilty compared to older Symbian S60. So Nokia profitability for S^3 was 19.5% in Q4 of 2011. And now a few comparisons: Of their Fortune Global 500 ranking in 2011 (which reflects their latest full annual results in 2010) we find Samsung corporation (includes much more than phones, obviously from televisions to microchips) was 10%. LG (similarly multi-business conglomerate) had profitability of 2%. RIM the Blackberry maker had a profitability of 17%. Nokia Corporation (including all types of handsets and its networking and Navteq units) earned a measily 4% profit. But CEO Stephen Elop discovered a true jewel in his crown, in Symbian S^3, that produced highly desirable Nokia Symbian smartphones on a 19.5% profitability! This is pure gold. And in just the first roll-out quarter, Nokia migrated 17.7% of its total smartphone production to this new hot profit engine. No wonder the smartphone unit profits surged 64% - yes, 64% in just one quarter.

I have explained here earlier, that if you manage to grow sales, grow average sales prices and grow profits in the same quarter, that is absolute proof that you are onto a hit product. Normally to get increase in sales you do it with either an decrease in price or with added marketing expenses (which reduces profitability) but with Nokia Q4, they had the very rare trifecta, increased unit sales, increased average prices and increased sales. So undeniably Nokia found itself with a big global hit in the N8 and its siblings that ran the latest version of Symbian S^3. And anyone who claims Symbian was not competitive with Android or Windows (either version) or RIM/Blackberry or the iPhone or bada or Palm/WebOS etc, is simply not dealing with facts. The OLD version of Symbian ie S60 was not competing well, it was struggling in the market and seeing declining sales and declining average prices (and declining profits). But Nokia's latest OS version and smartphones running on it, were definitely a hit globally. Now lets see where those phones were sold:

Nokia Handset Units Sold by Type:
Region . . . S^3 units . . . S60 units  . . dumbphones . . Total
Europe . . . 3.7 Million . . 8.9 Million . . 20.9 Million . . . 33.5 Million
MEA . . . .  0.4 Million . . 1.5 Million . . 20.3 Million . . . 22.2 Million
China . . . . 0.3 Million . . 7.8 Million . . 13.8 Million . . . 21.9 Million
APAC . . .  0.2 Million . . 2.6 Million . . 28.5 Million . . . 31.3 Million
N Am . . . . 0.2 Million . . 0.8 Millon . .   1.6 Million . . .   2.6 Million
LatAm . . . 0.2 Million . . 1.5 Million . . 10.4 Million . . . 12.2 Million
TOTAL . .  5.0 Million .  23.1 Million . . 95.5 Million . . 123.7 Million

(Note all totals match almost exactly with Nokia Q4 2010 results). A few definitions just to be clear, we use Nokia official classification so MEA is Middle East and Africa. APAC is Asia Pacific which includes Australia/Oceania. Then when we take the above numbers, and multiply them by the average sales prices as per the above, we get the following split of revenues:

Nokia Handset Revenues By Type:
Region . . . S^3 revenues . . . S60 revenues  . . dumbphones . . . Total revenues
Europe . . . 1.0B Euro . . . . . 1.1B Euro . . . . .    900 M Euro . . . 3.1B Euro
MEA . . . .     113 M Euro . . .   193 M Euro . .    873 M Euro . . . 1.2B Euro
China . . . .     93 M Euro . . . 1.0B Euro . . . . .   591 M Euro . . . 1.7B Euro
APAC . . .      44 M Euro . . .    333 M Euro . . 1.2B Euro . . . . .  1.6B Euro
N Am . . . .    66 M Euro . . .       98 M Euro . .     69 M Euro . . .    233 M Euro
LatAm . . .     69 M Euro . . .     198 M Euro . .    447 M Euro . . .   715 M Euro
TOTAL . .  1.4 B Euro . . . . . 3.0B Euro . . . . .  4.1B Euro . . . . . 8.5B Euro

(note again, all totals match very closely the Q4 results for 2010). And now lets add in the profitability of the three units to get total profits by each region:

Nokia Handset Profits By Type:
Region . . . S^3 profits . . . S60 profits  . . dumbphones . . Total profits
Europe . . . 200 M Euro . . 106 M Euro . . 104 M Euro . . . 409 M Euro
MEA . . . .    22 M Euro . .  18 M Euro . .  100 M Euro . . . 140 M Euro
China . . . .   18 M Euro . .  93 M Euro . . .  68 M Euro . . . 179 M Euro
APAC . . .      8 M Euro . .  31 M Euro . . .141 M Euro . . . 181 M Euro
N Am . . . .   13 M Euro . .    9 M Euro . . .   8 M Euro . . .   30 M Euro
LatAm . . .    13 M Euro . .  18 M Euro . . . 51 M Euro . . .   83 M Euro
TOTAL . . . 274 M Euro . . 275 M Euro . .  472 M Euro . . . 1.02B Euro

(once again the totals match very closely with those in the Q4 quarterly results). So, we can see now that the new Symbian S^3 was sold primarily in Europe, where 29% of all Nokia branded smartphones were Symbian S^3 phones. This is also by far Nokia's biggest market for total sales and biggest for Nokia handset revenues and profits. In it, the S^3 alone generated half of Nokia's total profit generated in Europe, while reflecting only 11% of all Nokia branded handsets sold in Europe. And this market we learn from IDC has utterly crashed due to the Elop Effect, and worse - this is precisely the market where Nokia's new N9 and other MeeGo handsets would be most welcomed and Elop refuses to sell them there. Total madness indeed. Europe was 40% of Nokia's total handset sales profits, and Symbian S^3 generated half of that in Q4. The Europeans love Nokia style, Nokia brand smartphones and were buying them madly before the Elop Effect. As the Elop Effect only affects Symbian phones, Nokia could avoid the reseller boycott by releasing the MeeGo based N9 and its siblings now, and recover much of that lost sales. The S^3 units in Q4 alone delivered 200 Million Euros of profits. If Nokia were only to recover that sales in Europe with the N9 (which costs more than 284 Euros) by releasing it widely in Germany, France, Britain, Italy, Spain etc (yes, Elop refuses to sell the N9 in any of those big European markets) the profits generated by the premium phone would nearly eliminate the losses generated by Nokia in Q2 !!!! This would be Europe alone, not to mention all the other regions that should get the N9, not just exotic tiny Nokia markets like haha, Kazakhstan (who are one of those 29 launch countries for the N9. How mad is Elop?)

But a few interesting observations from the above tables. In addion to Europe, the Symbian S^3 had captured 21% of Nokia smartphone sales in the Middle East and Africa region, the third best migration region for Symbian S^3, but quite surprising is the second best migration region - North America, where Symbian S^3 had taken 23% of all Nokia branded smartphone sales in Q4. Yes, obviously this is by far the smallest market, but even in North America the S^3 was driving a Nokia recovery. And we know the China region took to S^3 in a big way in Q1 but we do not have the data to calculate the exact contributions by region for Q1 unfortunately.

Two thirds of Nokia Symbian S60 sales were from Europe and the China region. So why not release the N9 in China then? We hear now that Nokia franchise stores - Nokia flagship stores in China - are suffering from the collapse of Nokia Symbian sales so badly, that they now have resorted to selling rival branded phones! Imagine MacDonald's selling Burger King branded burgers under the Yellow Arches? Thats how bad the Elop Effect has hit China. Why not release the N9 now, immediately, widely, globally?

And smarptohnes in Europe? Of Nokia's total corporate profits earned in any business in any market by any type of product, the smartphones business out of Europe generated 30% of Nokia's total profits in Q4 of 2010 - and out of that, the new Symbian S^3 generated two thirds of that profit out of Europe's smartphones. When we add China's smarpthones - these two regions, Europe and China, and their smarpthone business, not dumbphone business - generated 43% of Nokia's total profits in Q4. This is the 'Pareto Rule' ie the 80:20 rule, so as long as Nokia is doing well in Europe and China (and specifically smartphones there) - all of Nokia is fine, no matter how well Nokia does in any other part of its business, networks, dumbpohnes or Navteq, and in any other regions - North America, Latin America, Africa, rest of Asia, Oceania - it matters nothing if the smartphones business in Europe and China is crashing. Very illuminating indeed. It also gives clues to how quickly Nokia could be turned around if some idiot CEO stopped sabotaging his own sales in Europe and China.

And back to the S^3 premium smartphones. Using the current IDC numbers, Nokia's new S^3 had created a surge not just globally, but specifically in Europe. And ignoring all other Symbian S60 sales - the S^3 handsets alone had taken almost 15% of Europe - and thus S^3 alone would have been bigger than RIM or HTC or any other smarpthone brands in Europe except Apple and Samsung. And Nokia total Symbian sales towered over Apple and Samsung as recently as Q4, when in Nokia's biggest market - and the world's biggest smarpthone sales region then and now (Europe still sells more smarpthones than North America even now in Q2 although the gap is closing) - Nokia Symbian sales were far bigger than Apple AND Samsung - combined!

So now we know. Symbian was not dead. It had a strong Phoenix moment of recovery in Q4, when Symbian S^3 established a Nokia record for most sales of a new handset and new OS version, when three Nokia S^3 handsets (only one, N8, sold for the full quarter) produced a jump of 7% in Nokia branded smartphone sales, reversed a Nokia-pattern quarterly decline of 7% in average prices that had held true for as far as one can remember but rather produced a 14% jump in ASP (thus creating a 21% jump in average prices over where they should have been without S^3); and this in turn produced what must be a Nokia record (we do not have historical data to know for sure) of 64% jump in profits for the smartphone unit. And while Phoenix died flying too close to the sun, the Nokia Symbian S^3 was not dying, it was killed - by its master, the new CEO.

So what was Nokia S^3 for the corporation and brand new CEO Stephen Elop in his first quarter when he was in charge? Symbian's brand new OS version was in only 4% of all phones sold by Nokia. They were an instant hit and generated 12% of total Nokia handset revenues in their first quarter during which only 3 models had the software and only one of the three handsets was sold for the full quarter. And of Nokia total profits in the quarter? A massive 22% of Nokia's total profits came out of those mere 4% of total Nokia branded phones sold that had the S^3 operating system from Symbian. This is genuinely a 'Goose that lays Golden Eggs' It is not just a new cash cow, it is your profit engine right there. 4% of devices produce 22% of your total profits. This brand new OS and its brand new phones are the heroes of Nokia that the brand new CEO inherited. Any other reasonably intelligent CEO would have celebrated this team and its amazing new software and the brand new phones, and rushed to promote and celebrate their success, to quickly spread S^3 to all Nokia smartphones - not to fire the programmers and put an end their successful operating system.

Of course if the new CEO is not interested in Nokia's best interest, and wants to kill Symbian no matter what kind of success it can generate, and wants to replace the world's bestselling OS with the best ecosystem with the world's least-selling smartphone OS with the weakest ecosystem to be adopted by Nokia instead, then that CEO would release memos and decisions causing an Elop Effect to destroy his own products and their success. That CEO would have to be a delusional psycopath and he would not be working in Nokia's best interests but rather, in the best interests of say, Microsoft. But such a lunatic CEO would only be possible in a Hollywood movie of an alternate universe. If you look at the above numbers - and Nokia's CEO and CFO had these numbers in February when he made those fatal Elop Effect decisions - you will see that you are sitting on a pile of gold in Symbian S^3 - if normally Symbian is able to sell at prices only roughly in the price of an SonyEricsson featurephone, and suddenly you have a hit phone series selling in the prices of far more expensvie smartphones of the HTC and Samsung and other Android phones - and the Blackberry - and you have such a highly desirable new product range which jumps your profits by 68% - that is success by any measure.

What you do, is spread it to the max, not kill it. You reward and promote the engineers who managed that turn-around, you don't go firing them! No wonder morale plummetted totally after Elop's February madness. But thats another story. I wanted to share the numbers as this is the kind of stuff I do on my vacation haha.. A good multidimensional statistical problem haha, I love that, its relaxation for me. Feel free to share the above numbers and please quote TomiAhonen Consulting as the source for those numbers which are not directly from Nokia quarterly results.

Comments

[Peter]

@karlim, I didn't want to waste time in arguing Q4 2010. Tomi has completely covered it in multiple posts based on precise numeric facts. I would suggest you to re-read it. it is not arguable.

If you are investors or nokia loyal consumers or carriers or distributors, please focus on nokia's future:
1. Meego for the high end smartphone, at this time it is Nokia N9/N950/N900
2. Symbian belle for the middle/entry end smartphone
3. WP7 line for middle end which shares same hardware platform with Symbian
4. open the door for android
5. Fire Elop/Weber/Jorma
------------------------------
That's it.

[SoVatar]

@karlim: If you want to claim hard facts, then you need to be precise. Otherwise you are better off arguing using opinions, assumptions and best guesses.

Example: You write:
"Fact. Nokia N8 was at least twice as expensive as Sym 1 phones"

Twice as expensive in what regard? For Nokia to manufacture? For a distributor/ carrier to order? For a consumer to purchase? Locked, unlocked, on contract (1 year, 2 year, 3year). In Germany, Finland, or Bulgaria? The reason I bring this up is that 2010 an old N97 unlocked was priced at EUR 199 to the consumer in Germany while an N8 was offered for EUR 100 on a 2 year contract in Austria.

In my opinion, your "Theory - very little chance of cannibalization from Sym 1/S60" does not hold any water. On contrary, S3 devices were meant to replace devices like the N97.

I could go on and explain why what you present as "hard facts" are just opinions, assumptions and guesses.

And please do not quote G*zmodo. As far as I know they refused to "test" the N8. However they posted a blog where an apparently drunk blogger took some pictures with the N8 that were out of focus and blurred. It was not even funny what they wrote. I cannot comment about Enga$$et as I stopped reading their scribbles precisely for the same reasons why I argue with you: I cannot stand if someone presents assumptions, opinions, believes as facts when they are not facts.

However, I do not want to come over as defending Symbian.

Here are some hard facts:

Since fall 2007 Nokia's share price lost value rapidly.
In fall 2010 Nokia's Board replaces the (unsuccessful) CEO with a new one, an ex-Microsoft guy.
Nokia's share price stabilizes somewhat from fall 2010 to February 2011.
The CEO announces a new smart phone strategy, Windows phones will come and Symbian will be phased out, EOL'd. Nokia's share value loses immediately 25% and another 25% within 6 months after announcement.
Since the announcement of the new strategy, within 6 months, about $25 Billion shareholder value are destroyed.
Half a year after announcing the Windows phone strategy no single Nokia windows phone can be purchased. However, Nokia releases a series of Symbian devices that consumers should buy. (Why?)

There is no new Nokia Windows flagship phone offered since the N8 was released in Q3/2010.

These are facts.

[Victor Szulc]

@Sovatar
"And please do not quote G*zmodo..... I cannot comment about Enga$$et"

Translation: I don't like to read opinions I disagree with. I only read reviews if they confirm what I want to believe...

"The CEO announces a new smart phone strategy, Windows phones will come and Symbian will be phased out, EOL'd. Nokia's share value loses immediately 25% and another 25% within 6 months after announcement."

Which is natural and to be expected, since Elop made clear on Feb. 11th, that the transition is likely to cost share and profits in the short term. In the long term hoewever, it was the only viable way, which is why Nokias board agreed to it.

"Half a year after announcing the Windows phone strategy no single Nokia windows phone can be purchased. "

Did you even watch the presentation on Feb 11th? Elop made it clear that the transition would take several years to be complete, and that it would be a gradual phasing out.

"However, Nokia releases a series of Symbian devices that consumers should buy. (Why?)"

Consumers renew their cellphones about every two years (give or take 6 months) and since Nokia will keep supporting Symbian till 2016, why not? Just because Symbian is obsolete and being phased out, doesn't mean that the phone will stop working from one day to the next, ya know. As a Symbian enthusiast you should be happy that Nokia doesn't stop making it immediately, no?

[Victor Szulc]

@Peter

I'm somewhat surprised that you're comparing Olilla with Kenneth Lay, and not Adolph Hitler or Ghengis Khan, which would be par for the course for your comments...

"Jorma Olilla betrayed the interest of nokia investors by firing previous management and brought in Elop to destroy nokia for the interest of US naked short sellers. It is written on the wall. who has eyes can see it.

Criminal decision is criminal decision, no matter how great he was once before.

Conclusion: Elop/Weber/Jorma have to be fired and sued in Finnish Court immediately."

Well, surely if there has been that kind of criminal wrongdoing, and the crimes and conspiracies aren't just in your head, then the police is investigating, politicians are crying out for an official investigation, and tens of thousands are demonstrating in the streets of Helsinki... No? They're not?!? That's certainly strange, eh?

Perchance Microsoft has also stuffed the Finnish parliament, justice ministry and police force with trojans and bought stooges, eh?

[Peter]

@Victor Szulc, more than 1000 nokia employees had already gone on street to protest Elop's criminal plan which is designed to destroy nokia as a mobile giant and to downgrade nokia into wp7 oem. Justice takes time to come, but it does come.

[SoVatar]

@Victor Szuic:

When you write a sentence addressing Peter like "I'm somewhat surprised that you're comparing Olilla with Kenneth Lay, and not Adolph Hitler or Ghengis Khan" then you show that something is severely wrong with you. Just the thought that a CEO of a phone maker is at some level comparable to an Adolf Hitler who committed worst crimes against humanity is beyond me. You should be ashamed.

But comments like your's remind me why I stopped reading certain blogs like G*zmodo or Enga$$et. It has nothing to do with diverging opinions, but with (lack of) quality of writing.

[n900lover]

EL:

Uh, it doesn't matter how much work it would be to finish the move to meego (I would say couple of months max for team of few developers, and parallel to other developments), my point was that this can't stop you from creating new phones. Even if Nokia stayed in harmattan territory forever, they still could happily develop and sell new phones/tablets without disruption.

Intel just doesn't have processor that could match arm offering in power efficiency and is long way from achieving this (although they are working hard). That was obvious in 2010 as is today, I really don't know how anybody could think Nokia will go with atom in phones in short/medium term.

[n900lover]

apollo_dev_team:

I don't understand what "mass production related problems" could be caused by meego as OS and software. If it works in one device, it could be trivially copied to billion same devices, no?

Yes, in long lived mess such as this, it is inevitable also management problem. But I would think that the solution is first throw away the management, not the underlying product, and if you are also going to ditch the product, do it with proper reasoning...

[Earendil Star]

I understand Tomi is still trying to explain what Nokia should do, as if it still were an independent company.
Unfortunately, if there was still a doubt on the MS - Nokia relationship, this is the latest news:

http://www.zdnet.com/blog/microsoft/microsoft-weighs-in-on-mosaid-nokia-patent-deal/10523

What a laugh... Nokia patents are being sold and who reaps the benefits of the sale (at least in part and not as a buyer)? MS!
Ah, but MS gives billions to Nokia... not? Sadly, these billions are nowhere to be seen on Nokias financial statements... another joke by TH Elop... how funny!

As I have been claiming all along, Nokia is now just a MS subsidiary, that has been acquired for 0 (zero) $...
All moves by Nokia have now no longer anything to do with Nokia's own profitability, but with MS's...
And clearly TH Elop is simply a MS puppet, doing whatever is dictated by Redmond.
Sorry for all you folks MS - WP fanboi-trolls commenting nonesense on this blog, the game has now been revealed (actually I should have said 'once again', as if it had been necessary...).

One way or the other, the great monopolist (MS), will either be successful with its own OS (WP), which is looking all the less likely since no-one is buying it and in the meantime Nokia is disappearing (thus reducing the chances that the force feeding of WP to Nokia's former customers will succeed), or it will benefit from the success of the other real innovators (Apple, Android), by leeching from them fees obtained through blackmailing by patent lawsuit threatening...

Unbelievable... in the meantime Nokia shareholders have been hammered and no-one of them is even thinking of promoting a legal action against this scandal... amazing... they must be sleeping or still in too deep a shock to react...

I'm curuous to see if we'll hear some more detailed comments from Anssi once his non-compete agreement with Nokia expires (which should be any time now)... http://www.slashgear.com/anssi-vanjoki-my-hair-stands-on-end-over-nokias-fall-01168705/

[Eurofan]

@Earendil Star: Thanks for the link. I've been looking for more explanation of why Microsoft is now going to be a recipient of proceeds from Nokia patents. The article gave me more than I knew before but not nearly as much as I'd like to know. Looks like the "deal" Nokia made with Microsoft this year is quite multifaceted. Does the Board know what Elop has signed Nokia up for?

Off topic, but does anyone know if Swipe UI incorporates patents from MS? If so, perhaps Nokia paid for use of these patents by offering MS part of future revenue from Nokia patents through Mosaid. Looking at videos of Belle UI on new Symbian phones it's hard to see why Nokia can't make a go at selling Symbian smart phones in the mid-range for many more years. Since Belle has a lot of Swipe UI in it, I wonder if what we are seeing in Swipe and Belle is old MS patented tech from Zune and other MS work.

[Earendil Star]

@ Eurofan: I see that, like Tomi, you are trying to find a justification where there is none...
Nokia has been taken over by MS. For free. Period.

Patented tech from Zune or other MS work? Regarding a touch interface?
All is possible in the current patent legal environment, but just a brief reminder:
the iPhone was released in 2007, followed shortly after by the iPod touch.
Also Android is from 2007 (actually earlier if you consider the pre Google era).
Swiping is everywhere in touch interfaces (just check Nokia Maps on any Symbian device...).
The first Zune with touch interface (HD) came in... 2009!! (Source: Wikipedia).
By the way, if MS had had the idea first, they would have used it in their WP I guess...

You see, the irony of this whole thing is that -despite all the fuss that was stirred up by the notorious "burning platform" leaked memo, that contained a bunch of lies and had the only goal of making an absurd WP adoption look sensible- Nokia was ahead of MS also as far as software and UI is concerned.

What will happen (my forecast) is that the best pieces of Nokia's platforms, including the Swipe interface (which as far as I know is proprietary) will be ported to WP to make it more attractive to customers. Once again... for free!

The irony of the whole thing is that Nokia, supposedly having adopted WP as an alleged better software, will in fact -among other things- help MS in turning around its failing WP interface that so far has won... 1% market share in 1 year!

[janusanus]

It serves Nokia right to follow the path of other arrogant vanished companies. I have worked for them and many problems boil down to that the work culture is not good - it is tiring, stressful, tensioned. They value second grade employees, vocational school employees an' so on. They should not hire people like them (the management) but exceptional, bright, innovative people.

FACTS:

- Symbian is doomed, dead as a stone.

- WP7 is ugly "tile-monster", doesn't have the momentum.

- For e.g. HTC WP7 is just a egg in a basket, for Nokia it is a MATTER OF LIFE AND DEATH.

[apollo_dev_team]

@Earendil Star:

What's wrong with you Earendil Star? Who are you and what is your achievement in the world of mobile phone so you can easily write such comments? You mentioned Anssi, he has no balls and talked so much bull*hit on his time in Nokia.

[n900lover]

LeeBase:

"Just wait until the REAL wp is released. Yeah...we all said this phone was wp, but now that it's not sold well...we realize it wasn't really wp."

There, fixed for ya.

[peter]

@LeeBase, let's evaluate it by year end to see the results from WP7.5 and Meego N9.

[Tomi T Ahonen]

Hi all, am back from vacation, starting with replies

Hi Symbian, Giovanni, LeeBase, Samsonite, ejvictor, SoVatar and Platform

Symbian - thanks. Me too haha

Giovanni - interesting facts. I can also quote you a list of facts that counter your points, Nokia had its China sales, Chinese new year's sales, but now with huge 3G penetration in China on all 3 networks, Nokia's best Symbian season ever. Nokia launched its long-awaited E7, which not named a Communicator (as it didn't have 2 keypads, 2 screens etc like Communicators of past) was actually celebrating Communicator history at launch and most news stories compared the E7 not just favorably to Communicators, but a very potent high-end superphone, etc. But I am not going to. Are you Giovanni attempting to claim that when the CEO says the current platform will not be supported, it does not create an 'Osborne Effect' and are you attempting to claim that when the CEO badmouths his own products like in the Burning Platforms memo, it does not create a Ratner Effect. Both effects independently jeopardized those companies. What you list are utterly meaningless points, compared to the Elop Effect of February 2011. Its like after a tiger has bitten off your leg, you get stung by a bee. One is instantly life-threatening, the other is a mere nuisance. Get real, Giovanni.

Lee - I hear you, but after the Symbian decision was made - they had the S^3 launch. And the S^3 launch is clearly - CLEARLY - a success by the numbers. A HUGE success in fact, and S^3 is instantly suitable for all phones that Nokia could conceivably convert to Windows Phone. But S^3 would have its migration path and no hassles to Windows etc. If Elop was looking after Nokia's interests, and not Microsoft's it would look at S^3 performance and postpone the consideration of the switch in OS platforms. Come on, 64% jump in profitability? He had S^3 being rolled out on more than twice as many phones for Q1 and he could have pushed the E7 etc - and had a magnificent Q1 for Nokia with suddenly not just a strong increase in profits but strong performance (possibly market share gains, as we see how strongly China took new Nokia phones before the Elop Effect). He'd be the hero, but he wouldn't have the Microsoft deal. If Elop had Symbian S^3 as a public success in Q1, the Board would never approve his desire to end Symbian and end MeeGo and go Microsoft. He is no dummy, he know there would be an Osborne effect if he announced Microsoft during Q1, but he HAD to, because if he waited for full Q1 results - he had already seen the incredibly strong China results with S^3 in Q1 by early February - he had to rush the Microsoft deal, else it would be denied to him.

Samsonite - I deleted your comment once you started with the 'its common knowledge that Symbian is crap' bullshit. You HAVE to refer to the blog as written and the points made in the blog, or if you feel I am wrong, you have to provide facts, not about old Symbian but about the points made here, ie Symbian S^3 which clearly was a hit product. I deleted all of your posting obviously. If you want, please return with sensible comments that relate to the blog story not something irrelevant and unsupported.

ejvictor - good points and I agree

SoVatar - thanks for the reply to Samsonite. I deleted Samsonite's comment already as not suitable for this blog as not being based on facts or this topic. But thanks for the reply.

Platform - thanks for the posting. Note, that on this blog I have been critical of Nokia for long before there was a CEO named Elop, and have been critical of Nokia's execution in particular. But where you say I am against Elop, I am not against saying he needs to be fired for his choice of Windows Phone (I said I did not agree with the choice but I understand the reasoning and I felt it had a chance to succeed, back in February when announced). I am against Elop for killing Nokia by actions that are clearly breaching his fiduciary responsibilities as Nokia CEO. Elop is acting in the best interests of another company (Microsoft) even where it actively harms Nokia's interests, everything from the Burning Platforms mistakes-ridden memo to the timing - the timing - of the Microsoft alliance - to angering carriers (Skype etc) to now the utter madness of not selling the N9 (and N950) in every market and rather force Nokia to take corporate losses. Elop is acting against Nokia's best interests, that is why I want him fired. Not because Symbian needed to be replaced. I wrote that long ago and Nokia had already committed to a strategy to end Symbian but it had a far better solution - to migrate to MeeGo with a full migration path for its 400,000 strong developer community.

Thank you all for the comments, I will return with more replies soon

Tomi Ahonen :-)

[n900lover]

LeeBase:

No doubt about it, wp has hundredths of thousands of top notch apps and lots of ecosystems, it will be instant hit, thats sure thing.

Someone could ask why there are no reports of shops swamped by customers furiously buying fujitsu mango phone that was launched two weeks ago. Of course that is because this is not THE REAL wp phone, just wait for the htc thingies. Or perhaps it will start when nokia unveils its wp products in europe. Or maybe not, after all main market, which unlocks access to whole world, is usa, so we must wait into next year for the tsunami. Unless ms has even better ecosystem in development, waiting to be delivered in 2012 Q3, of course...

[n900lover]

Didn't get the memo? Apps are outdated! You should read your fanboy instructions from ms pr department more carefully.

http://telecomnewspk.com/2011/08/ios-and-android-focus-on-apps-is-outdated-says-nokia-executive/

If customers will be able to arm-twist more than few thousands n9 phones from nokia, it would be another big Elop failure. Yes, n9 & meego are great products and everyone knows that, but if he isn't able to outright kill it with all his powers...

[cuntor]

There is nothing proprietary in swipe ui.. Gestures have been with us a long time already.

If anybody should have a patent for swiping it is APPLE with its iPhone UI.. Nokia, never! Ovi map application is a copy of the generic google maps experience !

[Tomi T Ahonen]

Second set of replies, am on Aug 23 comments

Hi JC, Jessie, John, Asko, Patrick, PERUS and TDC

JC - No, that was not the case. That is what Nokia tried to say as their excuse. In reality Q4 had huge sales, all four analyst houses said the same, some who look at sales from vendors to channel, others who look at sales to end-users, there was no significant build-up at all. Sorry. That is Nokia propaganda.

Jessie - very good points and great links, thanks. Yes, Microsoft is trying to hijack the whole industry. You may enjoy my new blog today about Skype and MS..

John - yes, but at that time it was the fastest. Now Samsung has exceeded that level.

Asko - good point about MeeGo in 2009

Patrick - First on bestselling that did not change with the iPhone - Nokia sales kept growing 2 years into the iPhone. What changed it was only Android, and even then Symbian was safely the biggest until the Elop Effect.

As to best ecosystem, you can believe what fantasy you want. But by EVERY measure of ecosystems, the number of entities in it, the amount of revenue in it (as in business ecosystems) the viability of its members, the growth rates, by EVERY measure, Nokia's Symbian-Ovi-Qt-MeeGo was best or second best by Q4 of last year, by every single measure. No other rival is best or second best, not even iPhone iOS, by every measure. For example, iPhone was not the second most widely used smartphone in the world - Blackberry had (and still has) a far bigger installed base. No, by every measure Nokia was either number 1 or number 2. I call that the best. You can think whatever you want. We deal with the facts here on this blog.

PERUS - the Nokia Board will not get involved in daily actions, they approve the major decisions. So Elop switching from Symbian to Microsoft is something the Board has to approve. I have not said Elop needs to be fired because Nokia switched from Symbian to Microsoft. I was very clear on this blog, we won't KNOW if that strategy succeeds until about year 2013 at the earliest. I am highly skeptical, but that is not why I want him fired. Its his daily management that is killing Nokia. The date of when the Microsoft announcement was made (February 11) - that caused the Osborne Effect. The Burning Platforms Memo was not cleared with the Board, but the Memo caused the Ratner Effect. Osborne Effect alone killed the Osborne Computer Company. The Ratner Effect alone almost killed Ratner which had to rename itself after firing the moron CEO. Together these two actions caused now the Elop Effect at Nokia. And thats only the beginning, his actions to suppress MeeGo and N9 sales are bordering on criminal and he has to be not just fired, but sued for all the damage. Again, deciding which countries to sell the N9 is not a Board decision, that is a CEO decision. Or his interview with Helsingin Sanomat Finland's biggest newspaper where he said no further MeeGo phones even if the N9 is a huge hit, that is not the Board, that is pure stupidity by Elop, attempting to cause a second Osborne Effect for MeeGo and the N9. That is why Elop is the culprit here, not the Board. But the Board is acting now dangerously close to being in collusion. They see the damage, they have to act or else they too are culpable and should be fired - and sued too.

Asko good point about timing of MeeGo vs Maemo etc

TDC - great point about Qt. And again, if Nokia CEO wanted the best for Nokia, it would push Qt and MeeGo and Symbian, alongside this mad Microsoft strategy, especially as Qt and Symbian are intended to live, Qt can be used to make apps for S40 featurephones, and MeeGo has at least one phone coming out this year, the N9. Its madness to now torpedo all that.

Thank you all for writing, keep it coming

Tomi Ahonen :-)