Rating: It’s all about software and services
GoMo News snuck along to Nokia UK’s Xmas celebration at the Music Room in London’s Mayfair and had a very interesting chin-wag with some of Nokia’s top executives. As Dylan said, “The times they are a-changin’.”
The world’s leading vendor of mobile phones has been gradually mutating over the past few years and it struck home to GoMo News yesterday, that it’s no longer just about hardware for Nokia.
The parallels between Nokia and IBM are striking. At one time, IBM was firmly associated with mainframe computers and personal computers. Now IBM is closely associated with software services.
GoMo News is not suggesting that the old moniker – No-one’s ever been fired for buying IBM – applies to Nokia. Although, it’s hard to imagine anyone being fired for buying Nokia.
The crucial difference is that Nokia is genuinely placing its emphasis on software and services. And in particular the company is now being closely associated with Music, for example.
That’s not to suggest that Nokia has lost its focus on handsets. How many companies – in any industry – introduce as many as 75 new models a year on a global basis?
For Nokia, however, it’s all about building up the brand. For software and services it’s now got the Ovi brand of course.
But the Nokia brand is extremely powerful. Everyone always mentions the Apple iPhone clones they see on sale when visiting China. Imitation is the sincerest form of flattery.
So in China, Nokia phones are massively cloned. GoMo News was surprised to spot, for instance, that probably the most popular clone was that of Nokia’s extremely expensive Vertu phones. Another Nokia brand, incidentally.
So, while it might seem that Nokia is under grave threat from Chinese mobile phone manufacturers, the company has already worked out a strategy that will ensure it continues to thrive.
IBM eventually sold its notebook PC business to Lenovo. And if Nokia sold its handset business in ten years time to a Chinese manufacturer, it wouldn’t be either a big surprise or a major blow for Nokia the company.
After all, some 30 years ago Nokia was perhaps best known as a producer of Wellington boots!
This is a shame. Nokia makes lovely hardware, terrible software. Much like Sony, they should stick to hardware. If they are going to succeed against iPhone and Android in software then they need to turn their current software development group upside down. Ovi is middling at best. It would seem that the hardware engineers at Nokia get to either create the software or that the software engineers have no respect within Nokia.
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If there is no value add in hardware production for Nokia (it will be sooner or later), then Nokia should focus on software and services which are unique, Ovi is on the right way.