Two more by Tero ...
>> What on Earth will Microsoft do with 200 million feature phones a year?
Tero Kuittinen
BGR
September 3rd, 2013
bgr.in
The timing of Nokia’s handset unit sale to Microsoft came as a profound shock. In the spring quarter, Nokia’s Lumia volumes grew by more than 20% over the previous quarter and over the summer, the cheapo Lumia 520 seemed to have developed real sales momentum. Nokia was cruising towards a second consecutive quarter of 20% sequential Windows phone unit growth. Why sell the handset unit just as Nokia’s smartphone growth was finally picking up steam? Well, possibly because feature phone sales may have started tanking so badly that it threatened to trigger a cash crisis in 2014. Nokia delivered a fairly disastrous, -27% volume decline in feature phones in the spring quarter. There are some signs from Africa and India that the autumn drop might be even worse.
Yet Nokia still managed to sell nearly 54 million feature phones during Q2 2013. It’s still a company selling more than 200 million feature phones a year. And now Microsoft is in the business of selling 200 million feature phones a year. Is this something that Microsoft can possibly manage effectively? What can Microsoft do with hundreds of millions of $40 phones?
One possibility is that Microsoft will keep the Lumia unit and sell the feature phone unit. The challenge here is that nobody wants to buy a rapidly shrinking feature phone business. The unit may have to be ditched for one dollar to a company like Micromax or Lava. But a far more intriguing possibility would be Microsoft actually wanting to run a feature phone business.
What could the Beast of Redmond achieve with this massive, low-end machine? Could it take the Asha range of slightly premiumish feature phones and turn them into gateways to Planet Microsoft, featuring Skype buttons, Bing search boxes, Xbox Lite games and Outlook email?
$70 to $100 feature phones are now so sophisticated they feature Wi-Fi chips and could support a ton of Microsoft bloatware, including prominent Skype support and game downloads. Perhaps getting those features in front of hundreds of millions of new customers might be valuable enough for Microsoft to make it worth losing a couple of bucks per phone.
Could Microsoft be planning to turn Nokia’s cheap feature phone armada into a massive assault weapon intended to penetrate the very hearts of the mass consumer markets of Africa and Asia? This could be a far more interesting idea than trying to turn high-end Lumias into real challengers to Apple’s iPhone and Samsung’s high-end Galaxy phones. ###
>> A brief history of Nokia: When the future was Finnish
Tero Kuittinen
BGR
September 4th, 2013
bgr.in
For a few of years around 1996-1998, Nokia reigned briefly as the most electrifying technology company in the world. This was such an unlikely development that most Finns had great trouble understanding that Finland could be a global leader in the evolution of consumer electronics. For Finns, Nokia was a brand familiar from black rubber boots with an unusually clever heel design and the new triple-layered Nokia toilet paper that gave you that luxurious wiping experience. Nokia itself was a tiny, boring village. It had been a center for Russian fur trade 700 years earlier, when it was named after a small, furry animal with a black pelt. “Noki” means “soot” and “Nokia” means “The Black One.” Before Christianity’s arrival, Finns refused to use true names of important mammals, fearing the wrath of their godlike avatars. “Nokia” was one of the euphemisms used to avoid naming a religiously meaningful animal, possibly the mink.
We now understand that Nokia’s glory days were largely due to the fact that the global demand surge for mobile handsets was something leading consumer electronics firms like Apple, Siemens, Sony and Philips could not foresee. So Nokia ended up competing with two lumbering, erratic messes called Ericsson and Motorola.
Compared to those two main rivals, Nokia looked like a blazing ball of consumer friendliness. In the halcyon days before true competition from Apple and Samsung arrived, Nokia delivered what seemed like a dazzling series of innovative breakthroughs. Its global market share soared from 10 percent to above 30 percent in a matter of years as Nokia cracked tough markets like China and Brazil with astonishing ease.
Nokia’s Communicator arrived in 1996, 11 years before the iPhone. It combined email, fax, sophisticated calendar functionality and a massive display into a svelte package that weighed less than 400 grams.
The Communicator fit into a jacket pocket and it felt like a lump of future pulsating against your heart. I remember going to a Manhattan bar in my first visit to New York in 1997 and placing the thing on the counter. Literally everyone else in the bar had analog Motorola Startac phones that did not even offer SMS support. There was soon a crowd around me, exclaiming how America was years behind Nordic nations in mobile telephony. Like all Finns that year, I was drunk on an unearned sense of superiority — and three glasses of Absolut on the rocks I drank right after the taxi pulled in from the JFK.
In 1997, Nokia announced the 6110 and the 5110, two phones that towered over the competition between 1998 and 2000. These phones featured a quantum leap in talk time, a fluid menu system that placed a big emphasis on text messaging and an organic, slightly ovoid design. Snap-on covers offered a wild range of color options. Grandmothers and aunts were mesmerized by Snake, the mobile game that Nokia put into its new models. Text-messaging volumes exploded as these new phones offered five-line displays and exciting texting features like group-messaging.
Text-messaging, big displays, internal antennas, mobile email, designs aimed at women — Finns popularized it all. Because Japanese and Americans could not. Only Finns had the insight, wisdom and deep understanding. Nokia was The Dark One… a divine mammal striking down enemies of mighty nations. There is no comparison to the vanity and pride of people ruling Nokia’s new glass towers in early Noughties. The rock star executives from Nokia spun out of control like only internationally adored business stars in a country of five million people can. They made Steve Jobs look like Mahatma Gandhi.
And then, in 2007, things began falling apart with a delirious, loopy speed.
In the ancient Finnish epic, Kalevala, the poor northern people invent Sampo, an engine of eternal wealth. It grinds out gold, salt and wheat from three horns, day and night. But nothing that good can last, so Sampo is lost at the bottom of a lake and Finns return to their eternal gloom and poverty. The story is true in its core — the Finnish psyche is built to cycle between megalomaniacal euphoria and darkest depression.
Nokia played out that psychodrama on a global stage. ###
- Eric - |
