The financial markets are still reacting badly to today's event.
It dropped about the time the event began, down to about -14.5%. Then it inched its way back to -9.2%. But now, it's down to -14.3% again.
What I think is important here is that no Win Phone has captured the imagination of the consumer. I believe that it's caused by a major miscommunication between Microsoft and consumers. They've often been accused of not understanding consumers, and I think that's correct.
When Win Phone first came out, and Microsoft had theater $500 million advertising blitz, the point they were making, which was roundly criticized, was that with other phones, people spent too much time using them, and with wp, you could get on the phone, do your thing quickly, and get off again.
But people like their smartphones. They really like their smartphones. They don't want to get on and off quickly. That's a fundamental disagreement with what people want in their phones. And indeed, it's actually hard to use more than a few apps with Win Phone.
Another problem is the very concept of connective ness with Win Phone. Not everyone wants the first thing they see to be Facebook, or Twitter, or whatever. And the integration, while there, has been critiqued as being very basic—done much better with apps on other platforms. Maybe it's better with wp8.
It's possible that the entire concept of wp is wrong for most people. If that's the case, then they, and their ODM's are in a lot of trouble.
The market reaction today is that there's nothing in wp8, or Nokia's new phones, that consumers are going to drool over, and therefor, leave Android or iOS over. I would imagine that most consumers aren't even going to understand the major difference wp8 is from wp7. They look the same, and that's all the take will be.
And Nokia may not have that much time left. Their debt load is larger than their cash, marketable securities and investments. Major debt becomes due in early 2013, which really isn't that far away. The debt is rated at junk status. And has been degraded even from that. If they use some cash for expenditures, and tap into the two credit lines they still have, their position could be precarious early next year when that large debt becomes due, with another in 2016.
It's felt that they may not make it. If Symbian sales continue to fall faster than Win Phone sales increase, their situation will continue to deteriorate. And they are being hammered on the low end by ZTE and others. Additionally, thei networking division is also in bad shape, and they can't sell it, though they've tried.
So it can be seen why the stock is down so much today. And that won't help matters.
Meanwhile, I have doubts that the 4 million Win Phones they supposedly sold last quarter were sell through to consumers, rather than sales to the channel. I live in NYC, and I'm on the street and in the subways a fair amount of time. I've yet to see Win Phone anywhere. Mostly iPhones, Android phones and featurephones.
If the holiday quarter isn't good for them, it could be the beginning of the end.