Nokia Sells Set of Patents to Troll and Qt Developer Tools - More Elop Madness

Long Blog Warning.. not. Nokia sold the Qt developer tools to Digia of Finland. Elop said the future of mobile was determined by ecosystems. Qt was the last major asset Nokia still had and owned, to control a major mobile ecosystem, and compared to Windows, Qt could provide an ecosystem to low-cost smartphnoes and even more vitally, to Nokia featurephones running S40 that Windows Phone price points will not match. He now killed that. Utter madness. His 21st Major strategic mistake. Elop must be fired and the Board investigated for this action which is 100% against Nokia's best interest, but is blatantly in Microsoft's best interest. 

And Elop continued his bizarre fire sale of Nokia patents, selling a batch for esssentially peanuts, to Vringo. Elop is a criminal. Thats it. Long blog done.

PS if you want to read the first 19 strategic blunders, they are here, and the biggest blunder (the 20th) you have a choice - the rant version is here and the shorter, rational analysis version of the 20th problem is here. 

Comments

[Jeffrey Bolden]

I should say this isn't as bad as it sounds QT is LGPL so Nokia can always fork it back. What it does likely mean is that Nokia is firing the last people who know about the widget set for MeeGo. The company that has it now Digia is a company that makes their living by doing sub-vending work for Nokia. So the way Nokia is looking at this is likely as just outsourcing with Nokia having mostly as much effective control as they did before the sale. The problem with that is that Digia is a small company and any of the Nokia's main competitors could buy Digia for about an hour's worth of their phone revenue.

I wouldn't consider this a huge mistake but in exchange for very little money Nokia has created possibly a midsized problem. This doesn't have the potential to be a devastating error though I understand how it might sound like it could be.

Quick question if anyone knows this. What is Nokia's manufacturing marginal unit cost for an N9? Does anyone know or have a good estimate?

[jo]

Nokia now have no software asset it only a oem nokia only selling point is the camera

[Vinicius]

Gift wrapped with a note: "TO Balmer with love, Elop"

[Jeffrey Bolden]

Tomi

I just want to throw something out to see if if makes your list of errors of Elop or not.... From what I understand the US strategy for the Lumia 900 is being marketed to first time SmartPhone buyers because they aren't likely to be tightly tied to either Google's ecosystem (Android) or iOS applications (iPhone). Which makes sense but... The carrier they are partnering with is AT&T, and 77% of AT&T's customers are Smartphone customers, the most of any carrier in the USA.

Conversely where you do have a lot of first time SmartPhone buyers or those that don't have strong ties to either Google or Apple are the MVNOs. The overwhelming majority of MVNO customers though are on Sprint's network which is CDMA. If your strategy is about cracking into the USA market CDMA is an absolute must. I get that CDMA is only 9% of the world market but it is 60% of the US market. But worse, the customers that Nokia is targeting are probably 2.5:1 on CDMA networks. And let me just point out, since this is not the case in Europe Americans who buy postpay plans are generally much more loyal to the carriers than to handset manufacturers. Only RIM a decade ago and Apple five years ago were able to get people to change carriers, and even for them only in small numbers. You could probably count on both hands all the people who in the USA that are going to switch to AT&T to get the Lumia.

I can understand Nokia as a global company not being interested in the USA market not having a CDMA radio. I don't agree, I think it is a mistake but I can understand it. But if you are going to target the US market, a CDMA radio is a must. Just to emphasize this point, Verizon is the largest carrier in the United States. Their entire advertising campaign / brand identify for years, "can you hear me now" ( http://www.youtube.com/watch?v=OPwPo-IAQ-E ) is based on the advantages of CDMA over GSM: better rural coverage, better handling of obstruction.

[J.O. Aho]

Seems that Elop is making has all to ensure that Nokia has to make WP successful or be no more, a great way to ensure microsoft interests.

@Jeffrey Bolden:
At least when it still was Trolltech, QT had dual license where commercial products had to pay license fee while the rest went under *GPL. Not sure if Nokia changed that or how Digia has it (their page don't work well this morning for me to check it up).

The great benefit for Nokia would be that Digia seems to have plans to port QT to a small OS, WP8, will be interesting to see if there are any interests from the buyers of those devices, I guess there will not be that many.

[James G]

@Jeffrey - I remember my first Nokia soap bar phone from many years ago from ATT. When I switched to Sprint I really wanted another Nokia but no CDMA. I ended up with a Motorola Razr and that was sure a mistake. Battery problems like running down in less than a day after Sprint changed something on their network and they were actually no help at all. Switched to T-Mobile and got a low cost phone. Later Nokia gave me a C7 and I'm quite happy now.

Tomi,

Digia said after the deal goes through (it will be pending the usual shareholder and regulatory approvals for a while) they will start building support for iOS and Android. They already support QNX (new RIM OS). They are also keeping the LGPL license which Nokia introduced. Our company has 3 commercial accounts and the direct Digia news email said all this. I think this is nothing but good news for Qt. Now all they need is an app store. Anyone want to start one?

[Kirill Zelenski]

next step already done, Tomi. look at this: http://corporate.vringo.com/ir_NewsReleases.html

[JD!]

Thank God it didn't got burried coz of MS. Deveopers should be happy that it got sold. I hope that Digia will put S^3 support again in QT 5.

[Lasko]

- It is Qt, not QT.
- Qt is triple-licensed, commercial, LGPL and GPL; LGPL has been added by Nokia and this won't change at Digia.
- There is no S40 support or any other Symbian support it Qt5 (upcoming major release) at all; the symbian support code has been already removed from the codebase.
- There are no plans to port Qt to Windows Phone 7 or Windows Phone 8; The main focus for Digia will be desktop, embedded and mobile in terms of a commercial-grade iOS and Android port (including the already existing MeeGo, QNX and Tizen port).
- Digia will pick-up the vast majority of Qt-developers from Nokia.
- Digia is not a subsidiary of Nokia, nor a commisional or contract worker nor related in any other way. Digia is an independant market-listed multi-million dollar company, having offices in four continents employing way over thousand people.
- This is not outsourcing, Digia is not Accenture; they do no sub-veding work for Nokia. Nokia has sold Qt to Digia; this is where the similarities end.

[zlutor]

@Tomi: from QT perspective it is not really bad. It goes home where it is warmly welcome.
As mentioned, Digia promised to bring it to iOS and Android and W8 - although WP8 is not mentioned. (It is because WP8 does not support OpenGL (ES) needed for QT at the moment). maybe it changes in the future - either M$ will support OpenGL in WP8 or Qt will utilize DirectX somehow...

About patents: yes, it seems to be a tendency... :-(

On the other hand maybe it is part of some strategy - surprise, surprise :-) - related to defending hostile buy-outs. Maybe there is no other working defense strategy for Nokia? For sure they have no enough free money to defend themselves...

On the other hand it is quite strange when some company makes itself intentionally less valuable - even for such purpose...

[Dopey]

I don't understand how selling Qt can be counted a strategic error from Elop. You can call outsourcing and EoLing Symbian, or stopping Meego & Meltemi development strategic errors, but once those decisions are done and dusted, Nokia has no platform left that can run Qt apps. The fact that Qt development continues in a different company is the best outcome for both the Qt community as well as Nokia.

As an analogy, if you move to Sahara desert many can say it wasn't a clever thing to do. Once there, if you sell your raincoat, well that's just a logical consequence.

[zlutor]

Somebody highlighted one interesting aspect of the patent issue: http://mynokiablog.com/2012/08/09/vringo-to-acquire-500-nokia-patents-for-22m/comment-page-1/#comment-631208

"... are quite a potent weapon in fighting with Apple, Samsung, HTC, Google or, why not, even Microsoft..."

“why not, even Microsoft” – THAT is one interesting aspect…

Keeping these patents would strengthen Nokia’s position if they decide to break out of the contract they made with M$.
E.g. BOD fires Elop due to some reason and the new CEO would decide to go with Android…

Clever, very clever - or did I read too many conteos? :-)

[Lasko]

@Dopey:

It is for the simple fact that each ecosystem has an inevitable ingredient, applications.

Then: Create your application for desktop, embedded or any other mobile device; also run it on the Nokia ecosystem, beeing either Symbian, MeeGo, Meltemi, reusing all of your code and assets with little effort.

Now: Create your application for desktop, embedded or any other mobile device; no possibility to run it on the Nokia ecosystem, beeing Windows Phone, drop all you code, refactor and rewrite everything from scratch, be completely incompatible with the rest of your codebase.

How do you explain any company or developer to spend twice the budget and double the maintenance cost just to support a platform beeing almost non-existent on the market?

Most prominent example: Rovio and Angry Birds. Microsoft had to fund the complete developement plus a multi-million topping to cover support cost just to convince Rovio to port their game to the incompatible Windows Phone platform.

[Lasko]

@Zlutor

Qt5 will take advantage of ANGLE, which adds support for DirectX. However, this is not to support Windows Phone 8, but to support Windows 8, whose Metro-Apps are required to use DirectX.

And, please, for the sake of it - it is Qt, _not_ QT (which is something quite different).

[zlutor]

@Lasko: yes, I am aware of it. But it is not so easy...

More detailed explanation is e.g. here: http://qt-project.org/wiki/Qt-5-on-Windows-8-and-Metro-UI

And mea culpa: Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt, Qt... :-)

[Tomasz R.]

Patents are not a static entitiy like land. The case of patents is that if you engeneer, design or research you get the patents. Thats why Nokia was getting patents in the past. If you don't - you don't get the patents. That's why Nokia is not going to get much patents after Elop restructuring. And Google, Samsung, Apple etc. are going to have a lots of patents because of the work they are doing now. Which means within an few years (if it survives) Nokia is going to become an easy target to be sued by any company that is in the process of designing smartphones or smartphone OS/software NOW.

What's more - Microsoft exclusivity means it is an attractive target to sue for Microsoft competitors, as they don't break any partnership. Eg. Google would loose a good will in a partnership if it sued Samsung or HTC for Windows 8 phones, but they have nothing to loose if they sue Nokia.

[CN]

@Tomasz R.

Exactly. Or then not.

From Q2 report:

"We continued to strengthen our patent portfolio and filed more patents in the first half of 2012 than any previous six month period since 2007."

[JK Dispatch]

Jesus christ, according to Taloussanomat, Digia paid 4 million for QT. 4MIL!! What good does 4 mil do to Nokia??
500 patents and QT sold for 26million €. 26 million doesn't do much good to a company that announced 1 BILLION operating loss last Q.

[Dopey]

@Lasko:

I fully realize the value of cross-platform environments, but at this moment nobody is developing apps for Android or iOS with Qt so Microsoft's SDK is as good an environment as any for developers looking to have their apps run on WP (as opposed to imaginary Qt for WP alternative). Actually, the WP SDK beats the living shit out of any developer offering Nokia ever made available for Symbian (including the Qt ones).

WP will not support Qt (it's not really in Microsoft's interests just like Qt for iOS isn't in Apple's) and Qt is too heavy for S40 feature phones. So even if someone developed apps with Qt for Nokia, there's little hope of ever running those apps on Nokia products again. This, however, was a decision taken already before and I won't debate the merits of those decisions here as it's not the topic.

Hence: it would require a lot of additional investment for Qt to become a real alternative for cross-platform mobile app development. Even after this investment, this cross-platform portability would not apply to Nokia devices. So if some other company is willing to buy the asset and make the investment, it's great for both Qt developers as well as Nokia.

[Archsam36]

The big scandal you have all missed is Elop and other members of the board are buying up masses of Shares. If the company is sold (as is looking increasingly likely) they will make millions from this.

After QT what is next to be sold? The remaining patents?