NOK's "Do it all ourself" strategy said to be out of touch with the times. NOK fails to create a vendor value chain.
Stockholm, Feb. 22 (Bloomberg) -- Nokia Oyj, the biggest maker of cellular phones, is poised to lose market share because it handles everything from software development to manufacturing itself, the newspaper Dagens Industri said, citing Qualcomm Inc. Chief Executive Officer Irwin Jacobs.
Nokia is stuck in a strategy of ``developing everything itself,'' the newspaper cited Jacobs as saying. Meanwhile, rivals such as Motorola Inc. and Ericsson AB are licensing out mobile- phone technology, creating new revenue sources.
``Nokia has kept a vertical structure while the rest of the industry has adapted to a horizontal structure,'' Jacobs told DI. ``That could prove tougher because the mobile phones of the future will be made in a new fashion.''
Jacobs said the handset industry is heading the same way as the computer industry, where profits lie in making the software and chipsets for the finished product. Microsoft Corp., the top software maker, is trying to put its own software into more phones, a move analysts have said Nokia wants to prevent.
Qualcomm licenses patents based on the so-called Code- Division Multiple Access technology, which competes with standards Nokia is pushing.
(Dagens Industri 2/22 17; {DGNS } for Web site.)
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