Why Nokia Lumia and Windows Phone 8 will fail - ie will never become the promised third ecosystem

I am getting bored with the story of Nokia, the dead smartphone maker. Yes, Nokia has now become the Dell of handsets, ironically, as Nokia was the world's biggest smartphone maker when new CEO Stephen Elop took over (and more than twice the size of its nearest rival, vastly profitable in smartphones, growing smartphone sales, revenues, average prices, and profits. Not just that. Nokia grew more in that year 2010, than Apple, so Nokia was pulling away from its rivals, the gap was not closing, it was expanding.)

 

So yes, its like I said in February of 2011, when this mad Eloppian strategy was announced to switch to Microsoft's Windows Phone operating system for Nokia smartphones - it would not end well. Nokia would become Microsoft's slave and become instantly unprofitable, lose all its market and become a tiny bit-player in smartphones, making money only as a box-mover with perhaps tiny margins some day with low-cost devices. Yeah. Like it is today. Sony sold 8.8 million smartphones. Nokia sold 6.3 million. Nokia has actually fallen to 10th biggest smartphone maker, even Lenovo is ahead of it - and Nokia now is so much in distress, it makes a 49% loss on every smartphone it manages to push on unsuspecting customers - who then return them at Nokia record levels and 4 out of 10 buyers rate the Nokia Lumia series as the worst phone possible (according to independent survey of Lumia buyers by the Yankee Group earlier this Spring).

Nokia exchanged 29% market share with strongly growing unit sales, revenues and profits - for 4% market share today with declining unit sales, revenues and ever increasing losses. The promise of Windows Phone reached its peak market share of 3% with 4 million unit sales in Q2 but now even that is in decline, Nokia Lumia sales fell from that peak by a quarter already and now the Nokia Lumia market share for its Windows Phone based smartphones is.. 2%. This was achieved by murdering, obliterating, wiping out 27% of Symbian market share by Elop's 'strategy' and the only little bit of irony left, is that 18 months after Elop announced Symbian to be uncompetitive and obsolete, Nokia's smartphones built on Symbian still outsell those built on Windows Phone.

So who cares what this moronic strategy will achieve next year? I am truly tired of the story. But some Microsoft fan-boys again are promising yet once again, that 'this time' Microsoft will succeed in winning even though Microsoft failed with Windows Mobile, and failed with Windows Phone before Nokia joined, and failed again with Windows Phone 7 and now somehow it 'will be different' with Windows Phone 8. But yes, Steve Ballmer just told Microsoft shareholders that this Christmas, Windows Phone 8 is outselling last Christmas Windows Phone sales by a factor of 4. So how did they do last Christmas? About 1.8 million total smartphones under Windows Phone. If they now are doing 4 times better, the sales level would be around 7.2 million units. Before you say any 'oohs and aahs' - that would mean 3% market share for 'the Third Ecosystem' haha. How good is that? Well, Android is the biggest OS with 71% market share and growing. Apple's iPhone iOS is the second biggest experiencing now the sales hysteria of the new iPhone launches worldwide. In third place is the venerable Blackberry OS and in fourth place is Samsung's bada - which last quarter had a market share of 3% and was growing. If Windows Phone achieves 3% market share, it will move from 6th ecosystem to 5th, passing only one - yes, Nokia's Symbian. Its been years of Windows trying, and thats where they are at? Can't even catch up to bada, Samsung's 'second' OS for the Emerging World markets. See all the Q3 smartphone stats here.

That previous 3% market share peak for Windows Phone was, by the way, what Microsoft managed just briefly in Q2 of this year, before Ballmer decided to screw Microsoft customers and handset partners, by denying any migration paths from Windows Phone 7.5 to Windows Phone 8. No software upgrades allowed, even for 'flagship' smartphones by Nokia like the Lumia 900 that was just released weeks earlier with 'strategic partner' AT&T..

 

Sure. And Elop the Idiot, is echoing those promises of the Third Ecosystem, not just welcoming new competitive smartphones by rivals Samsung and HTC, he even says it would be good if Microsoft itself launched smartphones under the Microsoft brand, to compete directly against its 'strategic partner' Nokia. Whose CEO is Elop, exactly? And talking of Microsoft's own smartphones. We've seen their first PC hardware already, their tablet. And now rumors come from usually very reliable Digitimes of Taiwan, that Foxconn will start to manufacture Microsoft branded smartphones. How would they know? Because Foxconn is based out of Taiwan.

WHY WINDOWS PHONE 8 WILL FAIL

So. Windows Mobile had a peak market share of 12% once, before the iPhone came along. Windows Phone 7 had a peak of 2% market share before Nokia joined and was so poorly received by the market, that by the time Nokia's Lumia series launched, Windows Phone and Windows Mobile combined - were down to 1% market share. Nokia 'rescued' that only by sacrificing its own market share of 29% trading that for a 2% gain on Windows Phone and leaving Nokia Symbian with 2% left. So Nokia traded 27% o profitable smartphone business on Symbian for 2% loss-making business on Windows. You call that a 'good bargain'? I don't.

Now its supposed to be 'better' with Windows Phone 8? Why? Windows 8 integration? And where is this different from the Windows 7 integration that Microsoft promised with Windows Phone 7, or the Office integration Microsoft promised on Windows Mobile, or indeed - full Office suite integration Microsoft and Nokia achieved - on Symbian! back when Elop was in charge of the partnership with Nokia, from Microsoft's side.

If there was some magical integration benefits, we should have seen that, gosh, back in 2003 I'd say, or in 2004 or 2005 or 2006 or 2007 or 2008 or....

Yeah. Next?

Ah, the promised third ecosystem. Microsoft had 5% market share with Windows Phone and Windows Mobile two years ago at this time. How did that pan out, with the best efforts by Microsoft and handsets made by Samsung, LG, SonyEricsson, Motorola, HTC, Dell, and many many more? A year later that was 1% market share. That is what Microsoft is capable of. It is expert at destroying market share in smartphones. Why would Windows Phone 8 be different? I trust patterns. Microsoft is a market share murdering machine. And where are those partners? You won't find the Sony or LG or Motorola or Dell brands anymore making Windows based smartphones - they all do continue in smartphones, making Android based smartphones.

When Elop announced the Microsoft partnership, he did bring in 29% market share to play. He achieved at its peak 3% market share for Windows Phone. So he squandered 9 out of every 10 customers Nokia had patiently built over two decades, in the costly transition to Windows Phone 7. Now he does not have 29% to play with. Today Elop limps in with 4% total smartphone market share (Windows, Symbian and MeeGo, combined) to try to convert to Windows Phone 8. What will that get you? If the same pattern holds, he will bring 0.4% - yes under one half of one percent - gain to Microsoft's so-called 'third ecosystem'. This is, if we assume Elop manages to do 'as well as' he did with Lumia last time.

LEARNING FROM LAST TIME

How was last time? Last time, Elop launched the new Lumia series with 2 new Lumia smartphones for the Christmas season, starting in November. Like this year. What did they do? In that first quarter, Nokia sold 600,000 total Lumia smartphones. The market has grown 42% since then. If everything went 'as well as' last time, we could expect Nokia to sell about 852,000 smartphones for this Q4 season (on the new Windows Phone 8, plus some remaining sales on the obsolete Windows Phone 7 based old Lumia smartphones).

 

What about the launch countries? Yes, this time we have more countries where the new Lumia smartphones will be launched. The country spread is very similar to what it was in Q1 of this year, including the USA. Fine. How did Nokia do in Q1? Sold 2 million smartphones. Since then the market has grown by 19%, so by this model, we could expect 2.38 million Lumia sales if Elop manages as well as last time, but we compare to Q1 of 2012. Except at that time there was a third smartphone in the mix, so this is unlikely to be a close match. But if you want to be an optimist, thats your range, somewhere between 850,000 and 2,400,000 new Windows Phone 8 based Lumia smartphones to sell for the Christmas period this year, under optimal conditions (plus perhaps a million or 1.5 million of the obsolete older Lumia series).

 

That is not going to happen. Why?

PRICE

So lets start with price. When Elop launched the Lumia series one year ago, his price for the Lumia 800 was 420 Euros, and the Lumia 710 was 270 Euros (note, these prices are unsubsidised prices, ie 'real prices' without contract subsidies so the real price of an iPhone 5 is about 650 US dollars not 199 dollars you get on a 2 year contract). Their average price was thus 345 Euros or 450 US Dollars. The world average price of smartphones in 2011 was 307 US Dollars. The Lumia series was priced on average 46% above the world average smartphone price.

 

What did moron Elop do now with his new Lumia relaunch? The world average smartphone price has fallen 7% to 284 US Dollars. Elop pricing decision is.. Lumia 920 costing 649 Euros and Lumia 820 costing 499 Euros giving an average price for the two of 574 Euros or 749 US dollars !!! The Nokia Lumia series as launched last year was 42% above the average price of smartphones globally, and achieved 600,000 unit sales. Now Elop bravely pushes his new Lumias which cost ..  2.6 TIMES MORE than the average smartphone price! He has raised his prices by 66% from last year while the world price level fell by 7%. That means he is effectively 73% more costly now.

I wonder if Elop slept through the basics of economics class over at McMaster University up there in Canada? But the standard economic theory suggests that if you raise your price, you sell less, and if you want to sell more, you need to lower your price. Elop is accused by all ratings agencies for collapsing smartphone sales and market share, which is why Nokia's share price is now rated as junk by all three ratings agencies. What is his 'remedy' - he jacks up his prices - by effectively 73% !!!! - and he is 2.6 times more expensive than the average smartphone sold in the world. And you, the reader, expect Nokia to 'do as well now as it did last time' with Lumia? Think again!

Apple's primary market is the USA where the customers are very affluent and most smartphones are sold with subsidies. Nokia's main markets are in the emerging world where most phones are not sold with any subsidies - and where customers are not affluent. Most Nokia customers appreciate the value, not the premium price, of Nokia. Nokia's customer base expects a good price/performance ratio, they cannot afford to pay iPhone-level prices. Now Elop goes 2.6 times above the average price of smartphones globally? This is never going to be 'as good as' it was with the first version of Lumia.

EXCLUSIVE CARRIER DEALS

This is perhaps the most absurd decision by any handset maker CEO ever. When no other smartphone maker ever pursues this strategy in the mass market, and even those that tried this in launch strategy - like Apple - have immediately attempted to get away from the strategy as soon as contractually possible. The handset business is a mass market race. For a major manufacturer, like Nokia, you want maximum reach, maximum coverage. You do not want exclusive carrier deals. The carriers may prefer an exclusive deal, but it is never in the handset makers best interest - if market share is the goal. If market success is the goal. Nokia is struggling with market share and unit sales collapse. What you want is to flood the market on as many carriers with as many handset models as possible - look at Samsung! But no, Elop does the opposite. One year ago, with the first launch of Lumia, he did have the series broadly available. Now, he limits the availability with exclusive carrier deals!

 

Not me. Don't listen to me. Read what all other handset experts have universally said - that this is a dumb idea. If Apple moved away from this concept as fast as it could, and Samsung's dramatic growth is proof of exactly the opposite strategy - widest possible reach - then yes, if Elop does this with the re-launch of Lumia - it will not sell 'as well as last time'. No way.

CARRIERS HATE SKYPE

 

Then there is Skype. Do not come here to argue 'but you can do Skype on any phone' or 'there are tons of OTT services on other phones like iMessage, Facetime, Blackberry Messenger and Googletalk' etc. It doesn't matter what YOU think. The FACT is, that Nokia CEO Stephen Elop told Nokia shareholders - and I quote - "Indeed, Microsoft did buy the Skype company as part of the ecosystem that comes with Windows Phone and Windows. The feedback from operators is they don’t like Skype, of course." Elop went on to explain why carriers/operators hate Skype " (because) it could take away from revenues."

 

It is a fact, beyond any conceivable argumentation - that operators/carriers hate Skype explicitly, and hate Windows Phone because of it. This was with Windows Phone 7 which did not have deep Skype integration and did not reach the full Microsoft Windows desktop environment. With Windows 8 that is complete. If the carriers hated the Nokia and Microsoft partnership last year when Skype was only 'coming'. And that level of carrier support resulted in a peak market share for Windows Phone of 3%. Now that Windows Phone 8 does have full Skype - and Nokia CEO openly admits that 'of course' carriers hate Skype - what do you think those carriers will do with Nokia's Lumia Windows Phone based smartphones? Do you seriously think Windows Phone 8 will 'do as well as' last time? No way.

RUINED REPUTATION

 

Then there are those who really wanted a Windows based smartphone. Who really looked forward to Nokia hardware excellence married to Microsoft's Windows software. Yes. Such customers do exist. They were tricked into becoming the guinea pigs who were fed defective and incomplete bug-filled and poorly designed early Lumia smartphones. Most will have learned their lesson and will buy an Android or iPhone next. What good will was there to this partnership was definitely sunk when Microsoft announced that there will be no migration path from the first Lumia phones to Windows Phone 8. If you think Nokia's best reputation and what Microsoft had left last year, was able to achieve what modest 'success' they did, now it will not be that 'good'. No, this time it will not be 'as good as last time'. And this is before we consider how poorly the Lumia series and Windows Phone has met specifically Nokia customer needs - see 101 faults in Lumia (now with more Lumia: upgraded to 121 faults).

MARKETING OVERKILL

So then Elop promises the biggest marketing launch budget ever. Yeah. When have we heard that before? Last year, Elop budgeted 3 times more for the original Lumia launch than Nokia had ever thrown at any phone launch. THREE times more than what the world's largest handset maker and largest smartphone maker had ever done, a company that was known for dominating the marketing in its industry. And that was married with carriers joining in - for example AT&T did its biggest handset marketing push ever, to launch the Lumia. And add to that, Microsoft's massive budget, throwing even free Xbox 360 gaming consoles to buyers of Nokia Lumia handsets. Nokia booked Times Square in New York City for a massive launch party yet. What did that get you? Nine months later Nokia hit 3% market share at its peak. Now Elop promises to top that budget? Yeah. You really think it will matter? No matter how much more lipstick you smear on the pig - it is still a pig, Stephen Elop. It is still a pig. You best make back bacon out of it, Canadian-boy, nobody is buying your pig.

CARRIERS WANT A THIRD ECOSYSTEM

What we also hear is from both Elop and from Microsoft, that apparently they hear from carriers that the carriers/operators want a third ecosystem. They do not want to remain in a duopoly situation with Android and iOS. Ok. Listen carefully - what they have NEVER said, is that they want a Microsoft based third ecosystem. Not one carrier has ever said that. They have yes, said quite often actually, that they welcome another ecosystem or platform. But nobody welcomes Microsoft the cruel mistress and psycopath dictator. They want a partner. Like whom? Well, like Blackberry or bada or Symbian or Meego - all of these have been mentioned by some carriers/operators by name but never Microsoft or Windows. And what is their fave choice of third ecosystem today? Tizen! Yes, Intel's and Samsung's Tizen, what Elop abandoned from MeeGo partnership and Samsung jumped in to take over. Tizen. First phones launching in the Spring of 2013. Tizen. Tizen. Tizen. Why Tizen? Because many CARRIERS are themselves part of the Tizen partnership !!!!!! Like Telefonica

 

So don't delude yourself. Carriers do not want to drink the poison that is a partnership with Microsoft. They have seen how it is certain death.  They do welcome a third ecosystem, and they have already SIGNED UP to Tizen as the third ecosystem... Don't let the Microsoft reality distortion field fool you. Carriers fear and hate Microsoft, they do not want Microsoft anywhere near their strategic plans and platforms.

WIDE PORTFOLIO.. NOT

 

And then how do we reach maximum customers, if you want to gain market share and increase sales globally? You diversify, to meet specific customer needs. Some like the thin slab iPhon-a-Clone look-alikes. Others don't. There is a big market for smartphones with real QWERTY keypads from Blackberry clones to the sliders/folders such as the iconic Nokia Communicator series. Who is particularly attracted to real physical keyboards? The heavy texting and messaging users, the youth and young adults, who live on Twitter and Facebook and use all sorts of free messaging providers. Half of the youth can send messages blindly, with the phone hidden from view. That is almost impossible to do with a touch screen phone. Nokia has a strong legacy in QWERTY variants to its top phones such as the sister phone to the last global bestseller-award winner Nokia smartphone, the N8, whose QWERTY sister was of course the E7. And for example the MeeGo phones, the phone that was sold, was the N9 (pure touch screen) but it has a compelling sister phone with a QWERTY slider, called the N950, which was produced in small numbers (but Elop didn't release it for being sold, even though the demand was enormous).

Nokia's legacy, millions of very satisfied customers, have years out and years in, bought Nokia smartphones that included a full QWERTY keyboard of some kind or another. Elop admits there have been internal 'debates' about QWERTY variants, but as there is none on the Lumia series, clearly Elop has overruled his competent and knowledgable in-house experts - no wonder so many of them have been leaving the company.

 

Same story with the camera. Nokia's own study released this year, revealed that explicitly for Nokia brand smartphone buyers, this year 2012, the biggest feature their buyers want - is the camera. No surprise this has always been a Nokia strength, in no small part due to Nokia's exclusive partnership with camera optics specialists Carl Zeiss. The top Nokia flagship two years ago had a 12 megapixel camera sensor (it was a Symbian phone, the N8, a highly praised and award-winning smartphone that in its first quarter of sales, did 4 million sales worldwide. and note, the smartphone market has more than doubled since then. So Elop should be, just by doing 'normal Nokia' - achieve about 8 million sales of Lumia on Windows Phone 8 now, in addition to the modest numbers of the older Lumia sales).

So Nokia has a legacy in this, Nokia customers ASK for the camera. And Elop has given us now, what 6 separate models of the Lumia series, including three consecutive Windows Phone based flagships, every 6 months: the Lumia 800, the Lumia 900 and now the Lumia 920. And so, two years ago the N8 had a 12 megapixel camera (using Symbian). The current top Nokia Symbian smartphone has a camera with a 41 megapixel sensor. And on Lumia? The flagships have regressed to 8 megapixels !!!  Elop has literally taken Nokia customers back years - YEARS - on what the Nokia own customer survey reveals, is the top most feature that Nokia smartphone buyers ask for.

MISMANAGEMENT AND MISTAKES

The old Lumia series was plagued with software bugs and manufacturing errors (read the 101 problems in Lumia, now upgraded with more Lumia, to 121 problems). Now the newest Lumia series, running Windows Phone 8, is already reputed in having more software and hardware problems. Nokia is poisoning what little remains of its loyalty and destroying its brand. This is all 100% management mistakes and errors. As I keep saying, Elop has created the biggest market collapse of any market leader, in any industry, of all time. His performance is the biggest management failure ever seen in global business, and he is thus the worst CEO ever to take over for any Fortune 500 sized company. He replaced strongly growing global leadership position - where Nokia towered over all its rivals more than Toyota or GM or Volkswagen or any other car maker has ever done, since Ford nearly 100 years ago when it sold the Model T. Elop took over Nokia when Nokia was twice as big as Apple and four times as big as Samsung in smartphones, and growing faster than Apple! Nokia's smartphone unit was not only profitable, its average prices were increasing, and Nokia set a record for the jump in its profits.

 

This Elop threw away, and today only 2 years later, Nokia has one eight the market share, and has fallen to tenth in the Top 10 biggest smartphones. Apple is four times bigger than Nokia in smartphones; Samsung is nine times bigger. Nokia's smartphone unit was plunged instantly into loss-making and its losses keep growing bigger, not smaller, under Elop's management. As I pointed out, in Q3, Nokia was making a 49% loss on every smartphone it managed to sell..

 

SO WHAT CAN WE EXPECT?

 

Well, it was clear going from Q2 to Q3, that Nokia's old Symbian (and MeeGo) sales are now in terminal decline. There are no more new smartphones released on those platforms. If the sales decline was huge in the last quarter, with no new phones for Christmas and the newest Symbian phone being nine months old, the carnage continues. Symbian (and MeeGo) smartphone sales will definitely decine for Q4

 

I should point out, that the global smartphone growth average from Q3 to Q4 for Christmas sales, averaged on the past 3 years, is 28% Quarter-on-Quarter, which suggests Q4 smartphone sales roughly in the 210-215 million unit level for this Christmas season. Nokia's own average sales has suffered because of Elop's mismanagement, but even so, over the past 3 years, the average Nokia smartphone sales grew from Q3 to Q4 was 18%. If Elop simply hired a monkey to replace him, and that monkey did nothing more to damage Nokia. If Nokia was only doing what is normal, it would now grow smartphone sales from 6.3 milion to 7.4 million smartphones in Q4. That is the MINIMUM that Elop should be doing, what with the fantastic launch of the long-awaited Windows Phone 8 and all the MIcrosoft support and established carrier relations for Windows Phone and the Lumia brand presence globally, etc. How much Nokia smartphone sales will lag 7.4 million this quarter, is a sign of how utterly hopeless Elop is as a professional manager and executive for Nokia.

There will be legacy Lumia sales, on the old Windows Phone 7.5 operating system, the familiar four Lumia handsets that saw quite catastrophic sales collapse from Q2 to Q3. That collapse of course continues but there will be some sales of old Lumia.

The only hot new Nokia smartphones this Christmas are the new Lumia devices running Windows Phone 8. Lumia 920 and Lumia 820, on what few carriers they are offered, at what prices and with what limited availability.

I have modelled a few scenarios. I have assumed Nokia can repeat last year's sales of the original Lumia series (adjusted for market growth from 2011 to 2012). I have taken another assumption, what if the sales this Christmas are more like Q1 of 2011, for Lumia, as there are more countries covered now. Then I have assumed the migration level from existing Nokia smartphone customers to replace their phones (Symbian to Lumia). And I have taken the 'top down' approach, looking at Ballmer's bold claims and giving Nokia the best benefit of the doubt. I get this kind of scale:

Nokia Q4 smartphone sales are likely in the range of 4.8 million to 6.8 million this quarter, Q4 Christmas quarter of 2012. That would be roughly 31% of Symbian/MeeGo sales, 25% of old Lumia sales, and the remainder, 44% of new Lumia WP 8 sales. Nokia's total smartphone market share is headed to something around 3% now, and the Lumia series, Windows Phone based Nokia smartphones would have around 2% market share.

 

If you think this is 'success' going from 29% market share, dominating over Apple and Samsung, GROWING sales, growing unit sales MORE THAN APPLE, and making huge Nokia-record profits; to abandoning that strategy, and shifting to Windows where you now have 2% market share, are making massive losses, and your 'partner' is already planning to make smartphones in competition against you. I think you and I have a different definition of success.

 

PS Nokia Board - fire Elop NOW !!! Fire the Microsoft Muppet Now! He is utterly incompetent to run Nokia and every day he is in charge, he damages Nokia more, and is scaring away what remains of competent staff, who fear every day that he makes more moronic decisions.

And two short plugs - if you are interested in the facts, numbers, market shares, global and regional splits of the handset market, including smartphones, dumbphones, their operating systems etc, please take a look at the TomiAhonen Phone Book 2012 with all data current to the end of 2012.

And if you want to see what the near future of mobile industry looks like, from the expert who has in this mobile industry been the most accurate forecaster in the past 12 years (but past performance is no guarantee of future accuracy haha) including BY FAR the most accurate forecaster for Nokia, its smartphones and Microsoft Windows Phone - you might like the TomiAhonen Mobile Forecast 2012-2015.

Comments

[cycnus]

Hi Tomi,

Nice article.
I don't know how many aspirin you take to write this less-emotional article. :)

btw,
Microsoft problem with phone OS is because their employee who do the job is not good. Wired got a video that show Microsoft know about Kin problem even before they sell it. http://www.wired.com/gadgetlab/2012/11/unreleased-internal-microsoft-videos-show-why-kin-crashed-and-burned/ and this http://www.wired.com/gadgetlab/2012/11/exclusive-additional-microsoft-kin-usability-testing-videos-reveal-deeply-flawed-device/

[cycnus]

This is one of the Microsoft way of making us believe they have a great product.
http://www.traderplanet.com/commentaries/view/161991-tech-stock-mania-could-microsoft-be-the-winner/

[Tester]

@cygnus:

Haha, that article may be worth something if WP8 was actually any good. But considering how things stand... ;)

[Esa]

"The world average smartphone price has fallen 7% to 284 US Dollars. Elop pricing decision is.. Lumia 920 costing 649 Euros and Lumia 820 costing 499 Euros giving an average price for the two of 574 Euros or 749 US dollars !!! The Nokia Lumia series as launched last year was 42% above the average price of smartphones globally, and achieved 600,000 unit sales. Now Elop bravely pushes his new Lumias which cost .. 2.6 TIMES MORE than the average smartphone price! He has raised his prices by 66% from last year while the world price level fell by 7%. That means he is effectively 73% more costly now"

Are u fucking high? Did you consider that perhaps Lumia 920 is a lot better than "average smartphone"? It`s a high-end device which should be compared to SGS3 and iPhone5 and we can see the pricing is just fine. Or are you saying those are all priced wrong? I agree that the 820 is priced too high but there is absolutely nothing wrong with 920 price.

And the camera..it should always be compared to the competition. Now 920 is doing fine vs. sgs3, iphone, htc, nexus etc. and it should be rather easy for Nokia to be ahead in the next smartphone generation because of possible 808 pureview technology and so on.

[tomppa-is-a-troll]

If you believe what you write, you're no doubt shorting NOK heavily, right? I think the new Lumia 920/8X0 line alone will sell 7-9 million units this quarter. They would sell even more, if it wasn't for the component shortages (probably CPU and the camera unit).

[Tomi T Ahonen]

Esa lets keep the profanity off the discussion, ok?

Tomi Ahonen :-)

[Jesper Nyrup]

Yes ESA that's right. Nokia is losing money on every phone and this will somehow save them?
The only way Nokia can avoid death with the Winpoo strategy is to stop making smartphones, firing everyone in that area and doing something else entirely.
It's too late there is nothing to be done.
The microsoft phone will be the last nail in nokias coffin

[Tester]

>> The present situation of Nokia is because of cancer-Symbian. Luckily the cancer has been operated and WP will save Nokia.

If you want to compare Symbian with cancer - something I won't disagree with, btw., I would equate Windows Phone with strong chemotherapy. It first destroys the cancer but it also hurts the patient. And in many cases it also kills the patient, just as the cancer did.

No, Windows Phone won't save Nokia unless a miracle happens. People already hate Metro on Windows, how do you expect the same people to buy a phone using the same unpopular user interface?

No, sorry, they will say 'thank you' and buy something else, maybe an entry level Android phone, which Nokia has nothing to compete with since their own phones are exclusively targeted at higher end markets.

[Tester]

>>The new Lumias are very highly rated
[citation needed]

>>by consumers, and they are flying off the shelves.
[citation needed]

Just because some people with company interests say so doesn't make it a fact.

So where are those 'flying off the shelf' phones, for example on Amazon?

On Amazon.de, yesterday the highes ranking one was on #65, today it's no longer listed in the smartphone charts.

Yes, truly some success. And these things are wayyy overpriced, too. €200 more than a Samsung Galaxy S3 for a Lumia 920? Come on! That's utterly ridiculous.

[Interested to know]

It would be great to read some predictions about what Microsoft will do regarding Nokia once their Surface phone is ready. What is left for Elop & Ballmer to transfer to Microsoft? Surely they will formally sell the mapping stuff to Microsoft for a song. Will they start using Nokia's patents more aggressively to stifle their Android competition?

[nnine]

@cycnus: This is the usual Microsoft way. Push the buggy crap to the customers no matter what. You see it with the constantly crashing Windows Phone 8 as well. This worked with Windows on PCs where people had no choice, but times are changing...

@Esa: Don't be ridiculous.

BTW: it seems Nokia is hiring Linux engineers again:
http://androidcommunity.com/nokia-headed-to-android-hints-job-posting-20121130/

[JustMe]

Elop: Yes I believe all those user ratings are fabricated.
Just to refresh your memory: Lumia800 first and Lumia900 after where both (in the internet news) sold out and with hundreds of happy users on amazon:
http://techcrunch.com/2012/04/09/532392/
http://www.theverge.com/2012/4/14/2948039/nokia-lumia-900-out-of-stock-att-site
http://blog.laptopmag.com/nokia-lumia-900-top-selling-phone-on-amazon-beating-android
http://bgr.com/2011/11/24/nokia-lumia-800-sold-out-in-u-k-despite-rumors-of-weak-demand/
On Amazon US you can still find the more tan 400 positive ratings:
http://www.amazon.com/Nokia-Lumia-900-Windows-Phone/product-reviews/B007P5NHJO/ref=dp_top_cm_cr_acr_txt?ie=UTF8&showViewpoints=1
Surely all fabricated.Take a look how many ratings has the iPhone, a real best seller.

[Christian Maurice]

Nokia will maybe do Android phone or new linux based phone:

http://www.intomobile.com/2012/11/30/nokia-job-posting-hints-possible-android-device-development/

Plan B in action, they will not continue the spiral to death :)

[Tester]

I don't trust all those glowing user opinions either.

The lumia 920 has already amassed 100 'reviews' on Amazon.de, 88 of which are overwhelmingly positive. That's just far too much for the short timespan it has been on release.

So I think it's safe to assume that most of those have been posted by people attached to either Microsoft or Nokia.

What I find much more interesting is that there's almost no negative opinions. That's statistically impossible. With any product you'll find naysayers with a strong desire to bash it, hell, even the Samsung Galaxy 3 has 6% 1 star votes. So based on these things and average distribution of opinions I'd say that at least 70% have to be fakes but far more telling is that there's very few customers buying this thing unsuspectingly. It's probably just the Microsoft fanboys left.

User ratings can't be taken at face value, there's so much manipulation going on in that field that you have to extrapolate a bit - but anything with 90% positive votes is definitely bogus, no matter if it's Nokia, Apple or Samsung.

[Per Johansson]

Regarding QWERTY keyboards, Sony currently has no such phone. They said that the market demand is too small. When I read this news, I was quick to order a last year's Sony Ericsson Xperia Mini Pro, before it ran out of stock.
So most people seem happy without buttons to push.

[cm'on now]

Tomi, lose the manic punctuations (!!!!!!!!!). One symbol is more than enough to convey your passionate incredulity. We get the idea. Only idiots and/or chumps use those long strings! (<<--notice, one exclamation mark.)
Further, try getting out a dictionary and looking up the word/concept of concision.
You're a darned interesting guy but does every last entry need to drone on into what seems like perpetual verbal diarrhea?

[u1w1e]

Is it possible that wp8 sales actually haven't even started yet?? Samsung and Huawei haven't even anounced when their wp8 phones will be available. The Lumias at least in Europe seem to be in very limited supply. Big retailer like amazon have not even a date for initial availability ... well I know the HTC's are on sale ... but other then that, I have the impression cell phone companies are holding back. I wonder what the story is??

[Tomasz R]

You also have to remember, that on markets where Microsoft is successfull they then to increase prices of their licenses over time.

For example Office 2013 is going to be 10-17 percent more expansive to purchase, what's more - the licenses that allowed to install on multiple computers for the cost of a single license are gone.

http://news.idg.no/cw/art.cfm?id=AF728912-D47C-E05C-7A941A7B4167F993

Similar for office server software.

http://richfrombechtle.wordpress.com/2012/11/08/microsoft-office-2013-price-increases-license-changes/

For their successful product SQL Server they changed licensing from per-processor to much more expansive per-core model, where the cost that earlier would buy you a processor license now only gets you 4 cores (servers use 8,10, of even 16 core processors now).

For Windows Server itself they changed licensing from per-node to per-2-sockets. So if you use servers with more than 2 sockets, you pay more for new Windows. This is coupled with 15% increase in their per-user client acces license to those servers.

Basically their pricing and licensing terms are getting worse, and worse from a customer perspective.

So you can only guess what would happen if Windows Phone 8 achieves a success: the prices of licenses are going to go UP in a significant way!

[Michael Demetriou]

> If Apple moved away from this concept as fast as it could,

Apple even had a reason to start with this model.
1. They had a subpar phone, which lagged behind in all major technologies except the screen. It didn't have 3G years after it had become a norm on high-end phones, it didn't have gps to fight the N95, it had a mediocre camera, it didn't have apps. They needed to make it feel desirable, and exclusivity was a way to do that. Few people could have it, media coverage was huge, artificial demand had to be created. It was more like a demo device. The average customer saw one in the hands of a friend, impressed by the wow factor, but didn't live enough with it to get frustrated with the limited hardware.
2. Apple was a new player in the mobile industry, they had to make friends in the carrier world, and what better than landing exclusivity deals for a product with high media coverage.
3. iPhone production volumes couldn't probably meet demand. (Even NOKIA, with the biggest production capacity in the world faced shortages with successful flagship models - the N8 had a one-month gap in sales, shortly after release). It was better for them to look like they limit the availability because it's a phone for 'a few' than admitting shortages. There was even a limit of one per credit-card for AT&T.

A year later Apple came out with a real smartphone, with 3G, gps, apps, had proved that the product was a hit and had obviously planned for the increased needs in production volumes, no wonder they wanted to move away from the exclusivity concept. And by that time (and even more with the 3GS) they had the carriers lined up ready to carry the iPhone, and not the other way around.

None of the above is true for Nokia of 2012. Lumias ver.2 don't have any real wow factor, they have specs competitive with other flagships, Nokia is in no way a new player and exclusivity might hurt carrier relationships (those who don't get devices - assuming they would sell as Nokia expects them to.) and of course there is no production volume issue as Nokia factories are running under capacity.

It's not only that Apple moved away, it's also the fact that Apple knew why they went there in the first place, and when was the right time to move out.

[bjarneh]

Michael Demetriou> 1. They had a subpar phone

the iPhone was a sub par phone when it came, really? what was cutting edge tech at the time; the Zune-player? the Virgin Mobile Lobster?

Microsoft cannot expect consumers to forgive mistakes like the ones they have had with cell-phones, nobody who bought the Lumia 900 will splash out another $650 for the Lumia 920 (5 months later). the whole thing about not being able to upgrade from Windows 7 is a deal-breaker for the platform, Microsoft does not get 5 iterations to get it right, they get 1 (possibly 2 or 3 if you can upgrade).

the last Zune player was not bad, but with several bad iterations prior to that device, it was toast. the name Zune was synonymous with failure, plenty of jokes about the Zune over at theonion.com

http://www.theonion.com/articles/thousands-wait-overnight-at-microsoft-stores-for-s,2357/