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« Nokia Q2 Topline Numbers | Main | Apple Q2 Results. Signs now DO indicate that we have passed 'Peak iPhone' »

July 21, 2013



The most telling graph is this one:

On the day when Microsoft stopped buying their own ad slots, the ad impressions essentially dropped to zero. Interestingly the WP8 situation seems a bit more relaxed than the Win8 one.


Do we have any precise idea of how much did Elop cost to Nokia and to Finland ?

I remember last year it was about 70/80 Billion euros to Nokia, but excluded loss of patent revenues, increasing cost of the debt, and collateral hits in Salo and Oulu regions (stores, services, taxes, etc.)

How much would it be today ?


Just curious - a large % of the Q1 2013 Lumia sales were of old WP7 devices (something like 1.8 - 19m of the 5.6m Lumias sold, iirc). That led myself and others to wonder if it wasn't firesales, getting old inventory off the shelf at any cost, etc.

What happened on that front, does anyone know? Were the Q2 sales more of the same, obsolete phones that vendors were trying to get rid of?


According to the number crunchers those low price WP7 phones were replaced by low price entry level WP8 phones in Q2.

Essentially not much has changed. Nokia is selling better in the budget segment and the reasons are quite obvious. (many Nokia feature phone owners transitioning to smartphones and sticking with the brand. These are mostly customers who do not really know any technical background and just buy what's cheap and identifiable.)


Thanks for the link. I investigated most of the topics. However, I have to say, I still think that Nokia's transition periot was handled very poorly, "WP only" strategy is a clear mistake and mr Elop does not have characteristics of competent CEO for Nokia.


@kimmo "I know you are using Windows."

Kimmo, are you using Linux in your PC? I's fast, very safe if you compare it to Windows and it has all the applications you need. Why aren't you using it?

So in mobile world, if you say "I know you are using Android" it's pretty much the same, wouldn't you say? It's a different world.

Tomi T Ahonen

Quick comment on the low end

Yes, the market is shifting rapidly to ever-cheaper phones. The smartphone global market grows from just under 700 million last year to about 1,000 million ie 1 Billion this year. So we get 300 million new sales. Where does that come from? Its not at the high end of smartphones. It is at the low end. There are many touch-screen smartphones on Android at well below 100 dollars (unsubsidised) price. This is where Windows Phone is not currently economically viable - something we were warned by both Nokia and Microsoft staff two years ago - and I reported on this blog. So while Lumia prices come down at their range, they are still far too expensive for the low end of the market.

Sadly, Symbian was viable at the under-100 dollar smartphone market - but Elop killed Symbian prematurely, not even fulfilling his promise of 150 million more Symbian devices. That could be feeding now Nokia's place in this price segment as a stop-gap measure, especially with QWERTY smartphones that are still very popular in emerging world markets like Indonesia, Brazil, India and Nigeria.

Then worse, Elop killed Meltemi, Nokia's low-cost Linux-based smartphone platform, designed to support handsets at this low end of the price spectrum. Elop killed Meltemi when the first handsets were mere weeks from being announced. We can now see, with hindsight, that this was the timing when Nokia was trying to sell itself to Microsoft. Ballmer very cunningly then asked Elop to kill Meltemi before Ballmer would think of buying Nokia. Elop killed Meltemi. Ballmer decided then not to buy Nokia after all..

Smart by Ballmer, idiotic by Elop and once again, Nokia is the loser.

So don't fall into the story that somehow a cheap Lumia is the answer. Lowest-price Lumia in unsubsidised price is more than twice the cost of the lowest-cost Android smartphones. Nokia is priced out of the low end, but not because it cannot compete there, but because Windows Phone cannot compete at those price points.

Keep the comments coming..

BTW IDC and Strategy Analytics have released their Q2 measurements of the smartphone industry. They find surprisingly strong growth (10%) where I thought the market was about flat (which is usually the pattern). So my prelim market share numbers will probably be revised downwards when all 4 analyst houses have reported in. So the news for Nokia is even worse.... :-)

Tomi Ahonen :-)


@Tomi "So don't fall into the story that somehow a cheap Lumia is the answer. Lowest-price Lumia in unsubsidised price is more than twice the cost of the lowest-cost Android smartphones."

If Nokia executives somehow believe that cheap smartphones are the answer, they should worry about Firefox OS, which is trying to promote a truly viable "third ecosystem": open web apps.

Apps developed for Firefox OS should work without changes in Windows Phone, but apps developed for WP will require changes to work in Firefox OS and other platforms.

So the "third ecosystem" is not something that Mozilla or any other software developer owns, but the open standards that are part of the web.


Microsoft Is The Cancer Killing Nokia


Nokia seems no longer satisfied with Windows Phone's priority at Microsoft and now openly criticizes them:

Tomi T Ahonen

About the Nokia complaints about Windows..

Yes, the voices are getting much louder. We don't know if Bryan Biniack's comments (Nokia VP of App Development) were authorized by Elop and Nokia PR department, but they no doubt reflect honestly Nokia's evaluation of how poorly Microsoft is supporting the Windows Phone platform.

So not only was Windows Phone (7) not ready for prime time (as Microsoft itself discontinued it, and offered no migration path to Windows Phone 8), and Nokia's own first rushed Lumia handsets not up to snuff (101 faults and all that). Now we see that while Nokia IS trying its best to produce better phones both at the top (Lumia 1020) and the bottom of the price pyramdid, Windows Phone isn't keeping up with the competition. Once again, even Android would have been better - staying with Symbian and MeeGo would have been far better for Nokia than Windows.

I am certain - CERTAIN - that if Nokia Board was told in February 2011, that Elop's strategy would plunge Nokia's smartphone market share into crash-dive from 29% at the time to 3% now - and that Nokia's profit-powerhouse, its future, the smartphone unit which had never reported a loss, would go into terminal failure under Elop, never once producing a full quarter of profits after the new strategy was announced - I am certain the Nokia board would have rejected Windows as an option.

We know this on this blog and others like Horace Dediu at the Asymco blog etc. But Elop didn't see reality, he has imagined an alternate universe inside his 'call me the General' head, and convinced the mostly Finnish Board of Nokia to believe his wild fantasies. The Windows strategy has utterly, comprehensively failed. Beyond even the worst of my scenarios I could imagine at the time...

What we would need now, is an honest appraisal of Nokia by its CEO, a true 'I'm sorry I set our platforms on fire' memo... And then he should resign.

Tomi Ahonen :-)


@Tomi "if Nokia Board was told in February 2011, that Elop's strategy would plunge Nokia's smartphone market share into crash-dive from 29% at the time to 3% now..."

Even 10% of market share would be unacceptable, and you alerted about that possibility on July 25, 2011: "Expect climb-back to barely 8% markets share by Q4 of... 2013 - best case scenario"

Elop never worried about Nokia. He wanted to promote the "ecosystem" -- that is, the part that belongs to Microsoft.

Now he says it was a wise decision because he believed that Samsung would come to dominate the Android market. But, at the same time, he kept inviting Samsung and other competitors to join the third ecosystem, having said with these words: "I want Samsung to be successful with Windows Phone".


Hey folks :
I have a problem with data lately given by Kantar (and reported by the excellent and especially objective

Kantar seems to say that :

- WP share rose from 2.9 to 4.0% in the US (+1.1%)
- WP share rose from 1.9 to 7.0% in Mexico (+5.1%)

In another hand, in its Q2-2013 Report, Nokia says sales in North America were down 17% (600k sold in 2012 vs 500k in 2013 - to be fair, let's say it's 100% Lumia)

How is it possible that WP market share rose in Mexico and in the US according to Kantar, at the same time as Nokia reports declines in the same period ?

- Is it because HTC sold massive amounts of 8s, 8x ?
- Is it because Canada sold back to Nokia millions of Lumias (thus compensating massive sales in the US and in Mexico ?)
- Is Kantar wrong ?
- Is Nokia wrong ?

Other problem : Let's say Nokia represents 80% of all WP sales (which is what's commonly admitted). If 80% = 500k devices (in the best scenario), then 100% is 625k. How come WP has a 4.9% market share in the US ? That would mean the whole US smartphone market is only 12.8 Millions devices ?

Can someone please help me to understand ?


Excellent article from ReadWrite

Nokia Grows Frustrated With Microsoft's Pace In Windows Phone
The software giant can handle the slow growth of Windows Phone. Its most important hardware partner can't.

The cracks are beginning to show in the multibillion-dollar mobile-phone partnership between Nokia and Microsoft. As Windows Phone continues to register minimal growth, Nokia has grown frustrated with how slow Microsoft is to improve the operating system. (...)

Nokia Should Have Known

Nokia should have known what it was getting into. In 2011, then-new Nokia CEO Stephen Elop decided to throw his company off the metaphorical "burning platform"—its homegrown software—and into the hands of his former colleagues at Microsoft with Windows Phone in a famous memo about the company's direction in 2011.

But he of all people should have been able to take a step back and say, “Really, is Microsoft going to be able to innovate this product at the speed of mobile?”

Of all people, Elop should have known that Microsoft, over the decades, had become a company that takes its time, focuses more on “speeds and feeds,” and lacked design chops. When he left Redmond for Espoo in 2010, he was the eighth largest shareholder in the company and a member of the senior leadership team. (...)

Nokia Must Take The Reins

The success or failure of Windows Phone is important to Microsoft, but not as much as it is to Nokia. Microsoft can survive with a Windows Phone that does marginally well in comparison to Google’s Android and Apple’s iPhone.

Nokia can’t survive in that marginal position.


Back in 2008 Nokia established Symbian Foundation for independent, open source and royalty-free development of Symbian OS. In 2009
Nokia signed EUR 500 million loan from the European Investment Bank to finance OVI Store development. In 2010 Symbian was chosen as "Embedded Operating System for Europe" by European Commission. Plans were made for EU funding of SYMBEOSE open source project (Symbian – the Embedded Operating System for Europe).
By that time Symbian and Nokia infrastructure as a whole was impenetrable for U.S. spy agency data gathering .
So they got to do something about that ... Kill Nokia for instance.


@chithanh "Nokia seems no longer satisfied with Windows Phone's priority at Microsoft and now openly criticizes them"

Why would Nokia be pleased?

Since the beginning of this partnership Nokia does all the heavy-lifting, while Microsoft gets a free hide.

This is even more clear with the Lumia 1020: "the best smartphone camera ever made — too bad it's wasted on Windows Phone":


Ironically Venture Beat rated 808 PureView disappointing since "The 808 PureView runs Nokia’s Belle OS". Apparently Nokia just can't do anything right.


Tomi; now that the Symbian life cycle has come to an end as far as sales go, I feel it's appropriate to make the Ultimate Symbian Sales Graph.

I don't know how complete numbers you have access to, but I would love to see a graph showing SALES NUMBERS IN UNITS, quarterly or at least annually, from start till now. It's my understanding that 2010Q4 actually was quite a good quarter when it comes to numbers of units moved, but the graphs I've seen only go from 2010 or 2009 at best.

It would be a very interesting graph to see and show, if you could compile one that shows the approx. sales numbers for Symbian throughout it's entire lifespan. It should be right up there on the Symbian wiki page, too. Don't you agree?

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