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October 20, 2011



I agree, Nokia's performance in this quarter was bad, as bad as expected.

What I just cannot understand is the unwillingness of Nokia / Elop to sell the N9 to customers prepared to pay a hefty price. My teenage son settled on an N9, imagine when he shows of the beautiful device to his High School friends. But no, no availability in the U.S., so he will go with the new Google (Samsung) Nexus.

Windows Phone? Who cares...


Give up Tomi. OPK effect was done over 4+ years. Now you need to fix it by Elop Effect.

Have to laugh at your face when you think Symbian strategy was sustainable in 2011. The board didn't think it was even before S3 launch tells you all. Hell even OPK had to channel stuff them

Nokia will receive marketing and payments much higher from Microsoft then any royalties they pay. Skype is doooomeeed hahah so funny


So, Nokia has halted its smartphone unit volume loss, sold 4.8 million more smartphones then you forecasted just yesterday, reduced smartphone unit losses from Q2 (operating margin -5.2% vs -6.2% in Q2), and you still can't admit that Nokia did better then you expected. And that situation improved significantly compared to Q2. (I'm not talking now about last year and what coulda woulda shoulda happened)

Btw, what about "Symbian boycott"? Who are those 16M people a quarter who are buying Symbian phones and how can they get them if there is some kind of boycott? And how come you are still talking about Skype hatred and boycott, when so many carriers already launched or are about to launch subsidized Windows Phones? Especially when just few months ago you made a bold prediction that no carrier will ever launch Windows Phone because of Skype?



I agree, haven't we both been telling Tomi the same thing for years? This is the first time that I recalled him acknowledging the seasonality of the iPhone. You really can only judge Apple on a year over year basis.

Also, discussing profitability use to be verboten here. Now he even acknowledges it.

Our little Toni has grown up :). I'm so proud.

Great article. This is the only blog where I can read about the cell phone industry from a global perspective.


Tomi: Here's a question I don't see anyone addressing. Apple will continue to sell the iPhone 3GS for the next year. The rate with subsidy will be $0. What do you think this will do to total iPhone sales, and how much of the iPhone "nano" sales will be taken by the 3 GS?


Your analysis are JUST GREAT - NOKIA is going bankrupt very soon


What about Sony Ericsson? do you expect a future for this brand?



From a pure logical standpoint it shouldn't make that much difference between $0 and $49 and $99 over the life of a $1400 contract. But the iPhone 3GS is still the second best selling phone in the US.

The iPhone 3GS is still around $399 without a contract. Is that cheap enough without a contract -- for a 2+ year old phone?


Tomi: At what price would Apple have to offer an iPhone nano to add 5-10% in market share? They now sell the 3GS for $375.

Also, do you have any market share stats broken down by price range?


@ darwinipish:
I guess Tomi can provide better numbers. But look at Nokia, they sold 16 Mio smart phones at an average price of EUR 131 (about $180). That should give some indication. 3GS for $375 is still way expensive in the global context.


Tomi, I have a question. You say that the carriers are boycotting Nokia and Microsoft because of Skype.

I wonder if you could tell us the basis for that claim. Is it that, on the basis of your general understanding of how the mobile industry works, you have logically deduced that this must be happening?

Or is it that the people who work in the industry, including high-level executives, have directly told that they are are boycotting Microcoft and it is because of Skype?


oops, that should read "directly told you"


@Michael: It's crazy but somehow the $0 or "FREE" is making a big difference in the US. AT&T's CEO just said today "We've seen a tremendous, tremendous demand for that device even though it's a generation old. And actually, we're getting more new subscribers coming on the 3GS on the average than other devices. So we also have our inventory sold out on that device."

This might not last for the whole quarter. And it might not be true for some other countries where $0 iPhones have existed for awhile, though the monthly fees may decline further for the 3GS.

So Vatar


That's what I will never understand about my fellow U.S. consumers. Most see that they get a phone for free (or an iPhone for only $200), but they do not account for the 24 months of at least $75, and in reality >$100 recurring costs.

Why is it that Walmart's $35 prepaid plan does not get more traction? Ah, right, no iPhone available there.

But I see a lot of families with iPhones for both parents and kids, complaining that a school excursion to the museum costing $25 is outrageously expensive. Go figure.


@So Vatar: This is the one way I can explain this thinking for those moving up from featurephones. On a family plan, the extra lines are $10 (same as before), with the extra cost being $15/month for the data plan, so that's only $25/mo total. With iMessage, texting between family members (and all other iPhones) is now free. If the iPhone happens to get broken, lost, or stolen, the family member reverts back to their previous older phone, and ends the data plan, and waits until AT&T allows them to get another subsidized phone (which AT&T might want to allow them to do sooner in order to get them back on a data plan). So a free iPhone makes the sunk cost or investment disappear.

The Walmart plan is also on T-Mobile, which many people find has the poorest coverage. (I used to be on T-Mobile. Great customer service but poor reception in my house.)

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Keep posting, it's a welcome relief.

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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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