New Nokia CEO offers brutally honest assessment of their post-iPhone future

New Nokia CEO offers brutally honest assessment of their post-iPhone future

New Nokia CEO Steven Elop, who formerly ran Microsoft's most successful business unit, has written one of the most brutally candid and forthright state-of-the-enterprise memos the mobile industry has ever seen, including an assessment of their position post-iPhone. Their "platform is burning":

In 2008, Apple's market share in the $300+ price range was 25 percent; by 2010 it escalated to 61 percent. They are enjoying a tremendous growth trajectory with a 78 percent earnings growth year over year in Q4 2010. Apple demonstrated that if designed well, consumers would buy a high-priced phone with a great experience and developers would build applications. They changed the game, and today, Apple owns the high-end range.

The first iPhone shipped in 2007, and we still don't have a product that is close to their experience. Android came on the scene just over 2 years ago, and this week they took our leadership position in smartphone volumes. Unbelievable.

He mentions Android's assault and lower priced Shenzhen units as challenges as well. Nokia makes brilliant hardware, arguably the best in the business, but they've been slow to adapt to the capacitive multitouch, app-centric, ecosystem-driven new smartphone world. And their software strategy has been fractured and frustrating. Elop clearly recognizes the issues and plans to start addressing them. Our own resident Nokia Expert, Matt Miller says:

Nokia will be holding their Capital Markets Day on Friday where Mr. Elop will reveal his future strategy. There are rumors that he might partner with Microsoft and release Windows Phone 7 devices or go with Android in an HTC-like multiple platform approach. As a fan of both Nokia and Windows Phone 7 you know what I would prefer. If Windows Phone 7 is brought to Nokia hardware then get ready to see a LOT more writing here on Nokia Experts as WP7 is my personal preferred platform at this time.

Will Nokia go with Windows Phone 7 or Android, try to relaunch MeeGo or Symbian at a faster pace with better user experience, or do something else entirely? And how, if at all, will it effect competition with iPhone? We'll find out Friday.

[Engadget via Nokia Experts]

Rene Ritchie

Editor-in-Chief of iMore, co-host of Iterate, Debug, Review, The TV Show, Vector, ZEN & TECH, and MacBreak Weekly podcasts. Cook, grappler, photon wrangler. Follow him on Twitter and Google+.

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There are 25 comments. Add yours.

Ronn says:

My bet is nokia and windows phone 7.

sting7k says:

At least they are being real about it. I'll keep my old Nokia candy bar in it's box for future museum donation; along with my Motorola V60.
Nokia may have ignored the N.American market for too long and they let Apple run away with it.

TK says:

I whole heartedly agree with you that they ignored the American market.

eric6052 says:

It's a possability that WP7 may be part of their strategy. If they feel that Meego isn't ready for prime time yet WP7 gives them immediate access to next generation OS. I don't forsee them abandoning Meego altogether because they have already invested a lot in that platform and they won't want to pin their entire high end business on Microsoft. They will also have to keep pumping out Symbion devices for the time being given how many were sold last quarter its still a huge market.

robnaj says:

Really hope that "memo" was fake. Nokia must not kill any thing but the compation if they go Windows phone 7 or Android that is a soaside I am a huge Nokia fan as well as an Apple fan and even I might not buy a Nokia phone with Windows Phone 7 or Android however N9 with Meego that I will save my money for to get off contract because who ate we kidding the network in the US are going to overloaded their software on it like on my pore Nokia E71x on AT&T. Nokia N9 witch is a N8(but with Meego) with a keyboard that OMG looks like a MacBook pro only smaller. Also Nokia can make cellphones radios and a much better browser than Apple. Have you ever seen the N900 that browser is super goodness it has been doing thing that my iPhone browser can only dream of doing like using the full Google Docs and playing all online formats and Flash Games like on a computer.

Jimmy Rand says:

Dude, I ran out of breath reading this. Commas, use them.

JNGold says:

I guess if Palm could do it with the Treo line (Windows Mobile), so could Nokia, whose worldwide distribution network remains strong. Nokia wanted S60 to be the "feature phone" OS and have Meego as their flagship. Nokia does build some kick-butt hardware, and has always been hampered by the sub-standard and aging s60 platform. I don't know if Nokia wants to go totally "HTC style" OEM approach, but an infusion of "new" blood and product lines might be just what the doctor ordered. Now if they can just get that US distribution network going.

parabel says:

I'd say Nokia should switch to one of the two major ecosystems (Android or WP7) in order to take part in the whole "Apps" business. Their own platforms just don't have any priority anymore amongst app developers and companies.

TumnusMr says:

If Nokia go with Android they will become another "me too" company and probably hardly make any profit like Motorola (even with seemingly successful phones)
WP7 seems to be too much of an unknown. It has Microsoft's backing and was just released and yet it doesn't appear to be grabbing any Market share.
I'd like to see Nokia licence WebOS. Yes it too is risky, but it has been out longer than WP7 and comes from a similar background to Symbian so Nokia fans are more likely to accept it as a replacement. WebOS is solid but the hardware has been lacking so Nokia could fix that. Nokia would need to go all out replacing their entire smartphone range with WebOS, but instead of making 2 dozen different models they need to make just a few different form factors of world phones that could become iconic like the iPhone.
We need more than just 2 dominant OSes (iOS and Android) to really drive competition and innovation.

Guacho says:

Ohh please Nokia, dont go for W7.... I smell disaster...

OmariJames says:

Wow. Really shocking but they have been a lot less aggressive than the others. I don't think they should partner up with anyone. Nokia can get back up there.

cycling56#CB says:

I like honesty, it is good to see a competitor not bashing the competition,I like my Nokia N8 and Apple iphone 4

Jake says:

Remember, Nokia does have a solid platform used by lots of developers: Qt. In my opinion, it's one of the best GUI toolkits around.

Mav says:

The way things were going at Nokia in the past decade, I doubt they will ever recover. I wish they would switch to rubber boots already.

Shrike says:

Nokia's problem is organizational. People are people and are basically the same everywhere. However, organizations can atrophy. They could have made a great Symbian based OS, but something within Nokia's software development organization is broken. They just can't seem to deliver, even though they have oodles of funds and ideas.
Going 3rd party for the OS is at best a bandaid. Nokia has to fix itself from within.
Not sure what they can do on the low end and mid-end though.

pcdsim says:

Nokia + Android = Pure Win

TK says:

They'll probably go with both. But they'll still alienate the American market where iOS and Android are running wild. US carriers can't even GIVE away Nokia phones because no one in the US wants them. Nokia mostly makes GSM phones, which alienates Verizon and Sprint. AT&T has the iPhone so that really only leaves T-Mobile where people buy Android or Blackberry phones. Only the super phone nerds know what the Symbian OS and there's no marketing in the US for Nokia phones like there is the iPhone or Droid brand phones. So it's their own fault for ignoring the US market and not marketing their phones to the US to get people interested in them.

SockRolid says:

@ Shrike - "They could have made a great Symbian based OS, but something within Nokia’s software development organization is broken."
Palm had similar problems, but far worse. They did almost everything imaginable to prevent themselves from developing PalmOS, other than burning down their headquarters building. They spun off the PalmOS group, hedged their bets with Windows CE, the PalmOS group got bought by a Japanese company, then Palm bought back the rights to develop PalmOS again. In the meantime close to zero development got done. They just kept on shipping variations of the Treo.
Nokia doesn't have those excuses. Their destiny was in their own hands the whole time. They just didn't keep up with software technology, they didn't see iPhone coming, and when it arrived they tried to ignore it. Nokia thought that their relatively slick hardware could carry them over. It won't.

Salty walty says:

Basicaly nokia has been asleep at d wheel. My 1st cel fone was a nokia.since den i havent heard or seen a nokia fone. Der d dinosaurs of the mobile space. They hav been extinct in america for awhile. Insted of suing der competitors they shud focus on products dat consumers want!!!!!

Jojo says:

What language was that? Google couldn't translate it for me. Please help.

jzajzz says:

I think it's pretty much a given that they would go with Windows Phone 7 based on the leaks.
I think that will help WP7 but I don't see how it helps Nokia. If they would have gone Android, they would be able to differentiate their products. Going with WP7 means they will only have to focus on hardware. Nokia is good at that so that's why I think they'll haev success in the countries where they have a strong presence but not in the US.

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