NOKIA – Connecting people?

Nokia, now more or less like a serious heart patient on a ventilator, is striving hard for its sustenance in the market. The brand once was synonymous to cell phone, the brand which once was more popular than the star icon - Amitabh Bachchan, the brand which has captured the minds of several millions; is now almost vanished. Nokia finds extreme difficulty in coming out of that status quo even after launching many new models. The “former No.1’s” dismal performance continues in the international telecom market for quite a long time.

It was not an overnight journey for Nokia to reach the top of the world. Hard work, continuous innovation, customer knowledge base etc. marked their success in the cell phone market. The way they custom made the cell phones according to the needs and desires of the customers was tremendous and should be highly appreciated.

Nokia – where did the mistake happen?

Everything went quite well until the time arrived when they started underestimating the term “smart phone”. It was in early 2008, when a consortium of 34 companies (Open Handset Alliance) started working in a project called “Android”, for which Nokia hardly gave any attention.

In India, soon after Micromax launched an Android phone which priced as less than 3.5k, many companies started launching their low end Android mobiles. The high brand value of Google, price and the customization factor tempted the public to try those models which inturn helped Andoid to gain popularity and this further prompted Samsung, LG, HTC and other companies to launch their different models to utilize that demand fully. Slowly and steadily Android gained strength eclipsing many of its competitors (iOS, Blackberry-OS). The high brand value of Apple, the unique apps of Blackberry, cheaper and efficient Android phones of Samsung, LG, HTC; all these factors literally squeezed Nokia from all sides and ultimately pull them out from the market. The lag in identifying the emerging competitors marks the beginning of Nokia’s fall in the smart phone segment.  

Nokia-Microsoft deal

Nokia refused to join the consortium (Open Handset Alliance) and decided to continue with their Symbian and Windows mobile OS hoping a success to the latter. Microsoft however welcomed this move of Nokia for obvious reasons; Firstly Windows mobile-OS became obsolete due to the extreme failure of their highly anticipated and high budget project, MS-kin (MS-kin was a $1 billion project, but Microsoft apparently withdrew their MS-kin cell phones exactly 48 hours after its international launch) in 2010. Secondly as per the deal, Microsoft had the rights to handle the software interface which includes the usage of various apps (E.g. ‘Bing’ search engine) which itself create huge revenues for Microsoft. Thirdly the deal gave Microsoft a platform to use Nokia’s authorized dealer network as Microsoft’s official “marketplace”. As a result, the relationship could not result in converting into numbers for Nokia.

Nokia now

Nokia has been trying with their new models (Lumia 900, 800, 610) in recent times to create a pull in the market. Despite its high brand endorsements and other marketing efforts, the new products however generate rather poor acceptance due to many reasons like substandard technical specifications (no flash, no Bluetooth file transfer, no video calling, no USB mass storage mode etc.), absence of Android and relatively high price compared to its competitors. Apple and Blackberry are not going to provide their OS to Nokia by any chance which finally gave Nokia left with only one chance; to stick with Windows OS only. And hence in June 2012, Nokia made another deal with Microsoft with a view to launch Windows 8 (mobile version) on their new cell phones. Nokia cannot expect an immediate response and acceptance from the public. They surely have to wait for quite a while as we all know “It takes a few seconds to destroy a brand, but will take years to revive”

Now let’s wait and see what Nokia has reserved for the public and how the public respond to the new Windows 8-enabled phones of Nokia.

Note: Nokia has become a failure only in smart phone segment. However in the segment of low end mobiles, still Nokia has a decent market share.