I for one welcome Newtron's new-found high standards for being allowed to have an opinion.
I trust that in the future he will refrain from second guessing Apple's product decisions or strategies, as he has presumably never conceived of, designed, tested, brought to market and supported any piece of consumer electronics or software.
I also trust that the rest of us can remind him of the new criteria should he forget.
Apple's disruption of the market caused a dramatic shift, taking power away from carriers, and moving it towards consumers. I don't think Nokia ever figured this out.
C.
With your other points I agree, but this last one I have a harder time with.
I believe most analyst say that Nokia's failures in the US have a lot to do with the fact that they didn't bend as much to carriers at the carriers would have liked. In fact Nokia phones are sold globally via carriers and street corners (where iPhones are generally not).
So I believe it's the other way around. Apple shifted more power to the carriers and less to the consumers as in many many countries the consumer cannot select their carrier if they want the iPhone. With Nokia it's the other way around. Also Nokia devices are more open and tailorable (no need for App store, swappable memory cards etc.etc.) than iPhone so how was it again that the power has shifted to the consumer thanks to Apple?
If you're talking about Apple pushing the drive towards flat rate internet access and web-based services then I'll agree.
I actually wanted there tablets to succeed being the first to market and running open source Linux. Even after iPod Touch came out they still didn't grasp what people wanted in hardware and software. Touch blew the Nokia N series tablets away, especially after Touch got the basic apps from iPhone.
The sad part here was Nokias seeming unwillingness to invest resources into the product and the constant shift in stradegy. They relied way to much on outside development for key technology. For reasons of integration and acceptance there are key apps that a device needs to come with and work well. Sales of the Touch really took off after Apple started shipping them with apps from the iPhone. In the end it looked like Nokia was expecting a free ride from the Linux / open source community.
That is software then we have the hardware issues. At least Apple focused on having enough resources to implement key technologies like video well.
In a nut shell Nokia, in my mind, developed a reputation for half (quarter) baked goods. Lets face it they are the kings of crap products further fouled up by Verizon customization. For a company that is supposededly as big as it is they did nothing to innovate.
Frankly the best thing Apple, Google and Motorola could do is to pool resources to buy the company and shut them down. Then put their patents into a pool so that the silly law suits go away. It would actually be better for competition.
With your other points I agree, but this last one I have a harder time with.
What I am suggesting is that the majority of mobile phone customers initially selected a carrier and then picked a handset that the carrier offered. This worked well for Nokia. Their products were well represented with all carriers.
iPhone disrupted this.
With iPhone, the consumer selected the device, and picked whichever carrier that went with it. Even if that meant moving carrier.
There's a good write-up in last month's Wired about Apple's relationship with AT&T. Basically Apple rejected all of the standard carrier crap. They just made a device and marketed it to consumers. The consumer has a brand loyalty with the device manufacturer. The carriers were just a necessary evil who charged for airtime and patchy reception.
"Nokia devices are more open and tailorable"? Hmmm. You'll have to explain that one.
I think if Nokia devices offered any tangible advantages over iPhone, they would not be seeing the collapse in confidence we are seeing now.
I think we all know what you are saying...you are clearly pushing an agenda trying to say vendors should go with Microsoft Phone 7 because they will make more money,
Nope. I never said anything like that. I have no way of knowing which strategy is best. I think I said that over and over and over again.
Oh. Ok. So in 2011 you will be in a position to say that they need to return to profitability.
Ok.
Right now, they need to return to a level of profitability commensurate with a company with the world's largest market share rather than a level of profitability comparable to an Alaskan Koran salesman.
That's rather a mouthful.
So I prefer the more economical - "they need to return to profitability."
Tell you what: If and when you sit on the board of a multi-billion dollar company that sells more product in their category than any other company in the entire world, THEN you will get to choose a new CEO.
Until then, I think I will trust the judgment of those who actually have some credibility in the industry, OK?
Shows how much you know fool, people pay to get on boards, back handed deals. i dont need to be on the board to figure out that was a bad idea getting anyone from microsoft to run that train wreck
"Nokia devices are more open and tailorable"? Hmmm. You'll have to explain that one.
I think if Nokia devices offered any tangible advantages over iPhone, they would not be seeing the collapse in confidence we are seeing now.
C.
I didn't say that they are necessarily tangible for the average consumer (or maybe they would be if marketed well enough), but even the US consumer is becoming more aware of limitations that iPhone enforces on the consumer. If the User experience and App availability become "close enough", then they may become important.
But the things that I meant are stuff like customisable ringtones for all incoming stuff (SMS, Voice, Video, IP telephony etc.), free choice off apps, open source OS (next in line), almost full customisability of the UI appearance (not behaviour), widgets, removable storage, USBOTG, USB storage mode, FM transmitter, WLAN AP functionality etc.
The closedness and huge price (900 Euros for iPhone 4) if you don't take a ball and chain from a carrier I don't want is the reason I haven't gone the iPhone route despite owning several other Apple products and propably continuing to purchase more.
That's what I meant with "more open" and with restricting consumer choice. You see, I cannot choose my operator if I want an iPhone. I don't like to be artificially restricted and limited competition leads to higher prices -> not good.
What I am suggesting is that the majority of mobile phone customers initially selected a carrier and then picked a handset that the carrier offered. This worked well for Nokia. Their products were well represented with all carriers.
iPhone disrupted this.
With iPhone, the consumer selected the device, and picked whichever carrier that went with it. Even if that meant moving carrier.
C.
Isn't that precicely providing less choice to the consumer? If phone A is available at one operator, then the user has no choice if he wants that phone. If phone B is available everywhere and the user wants that phone, then the consumer has more choice of operator and thereby pricing and serivices. No?
Also you get more competition and better pricing because the consumer has choice. The operator has to compete on services, coverage and pricing. If phone A is the sexiest thing on earth, the consumer has to pay whatever that single carrier chooses to offer.
And as you said, Apple didn't care what AT&T wanted, they just made a phone. Nokia's been doing that in the US for years. They've been refusing to restrict the features and functionality on most of their phones based on US carrier likes and dislikes. That's why they haven't been succesful in the US. Nokia has been pro consumer in that regard. In some others, not necessarily as much.
Profitability matters, and popular opinion has it that having a large market share is one way of achieving that goal.
Nokia has the largest market share, but weak profitability. That is actually embarrassing. Because although Nokia's unit sales are increasing, its profitability is falling.
One way of describing this is that Nokia's products are becoming commodities.
Another way is saying Nokia have lost the ability to add value.
To "save" Nokia, the trend of lower profit-per-handset has to be reversed.
Isn't that precicely providing less choice to the consumer?
No.
It's the choices of consumers that now drives the market. Not the choices forced on consumers by carriers.
More precisely...
Pre iPhone, select a carrier, then select a device offered.
Post iPhone, select device, then pick carrier.
Consumers are now prepared to switch networks to get the handset they want. The ability of carriers to determine what are successful handsets has collapsed. Their influence has diminished.
This is quite a fundamental change in the way the market works.
In the UK, now all carriers now carry iPhone.
In the US, AT&T realised that customers would switch networks to get the phone.
Comments
Depends on what is meant by failure. MS depends on dominating a market.
I am confused - I thought market share did not matter.
This article is BS.
I trust that in the future he will refrain from second guessing Apple's product decisions or strategies, as he has presumably never conceived of, designed, tested, brought to market and supported any piece of consumer electronics or software.
I also trust that the rest of us can remind him of the new criteria should he forget.
Apple's disruption of the market caused a dramatic shift, taking power away from carriers, and moving it towards consumers. I don't think Nokia ever figured this out.
C.
With your other points I agree, but this last one I have a harder time with.
I believe most analyst say that Nokia's failures in the US have a lot to do with the fact that they didn't bend as much to carriers at the carriers would have liked. In fact Nokia phones are sold globally via carriers and street corners (where iPhones are generally not).
So I believe it's the other way around. Apple shifted more power to the carriers and less to the consumers as in many many countries the consumer cannot select their carrier if they want the iPhone. With Nokia it's the other way around. Also Nokia devices are more open and tailorable (no need for App store, swappable memory cards etc.etc.) than iPhone so how was it again that the power has shifted to the consumer thanks to Apple?
If you're talking about Apple pushing the drive towards flat rate internet access and web-based services then I'll agree.
Regs, Jarkko
The sad part here was Nokias seeming unwillingness to invest resources into the product and the constant shift in stradegy. They relied way to much on outside development for key technology. For reasons of integration and acceptance there are key apps that a device needs to come with and work well. Sales of the Touch really took off after Apple started shipping them with apps from the iPhone. In the end it looked like Nokia was expecting a free ride from the Linux / open source community.
That is software then we have the hardware issues. At least Apple focused on having enough resources to implement key technologies like video well.
In a nut shell Nokia, in my mind, developed a reputation for half (quarter) baked goods. Lets face it they are the kings of crap products further fouled up by Verizon customization. For a company that is supposededly as big as it is they did nothing to innovate.
Frankly the best thing Apple, Google and Motorola could do is to pool resources to buy the company and shut them down. Then put their patents into a pool so that the silly law suits go away. It would actually be better for competition.
With your other points I agree, but this last one I have a harder time with.
What I am suggesting is that the majority of mobile phone customers initially selected a carrier and then picked a handset that the carrier offered. This worked well for Nokia. Their products were well represented with all carriers.
iPhone disrupted this.
With iPhone, the consumer selected the device, and picked whichever carrier that went with it. Even if that meant moving carrier.
There's a good write-up in last month's Wired about Apple's relationship with AT&T. Basically Apple rejected all of the standard carrier crap. They just made a device and marketed it to consumers. The consumer has a brand loyalty with the device manufacturer. The carriers were just a necessary evil who charged for airtime and patchy reception.
"Nokia devices are more open and tailorable"? Hmmm. You'll have to explain that one.
I think if Nokia devices offered any tangible advantages over iPhone, they would not be seeing the collapse in confidence we are seeing now.
C.
I think we all know what you are saying...you are clearly pushing an agenda trying to say vendors should go with Microsoft Phone 7 because they will make more money,
Nope. I never said anything like that. I have no way of knowing which strategy is best. I think I said that over and over and over again.
Nokia's survival requires a return to profitability.
C.
2009:
# Reported net sales of EUR 40 984 million
# Reported operating profit of EUR 1 197 million
# Reported operating margin of 2.9%
# Reported earnings per share (diluted) of EUR 0.24
For a guy who has no opinion on the topic, you have WAY TOO MANY replies to this thread!!!
I agree. I hate it when people put words in my mouth.
I am confused - I thought market share did not matter.
Market share dies not matter to Apple.
Except WRT the iPod. Then large market share means that the iPod is the best device.
2009:
# Reported net sales of EUR 40 984 million
# Reported operating profit of EUR 1 197 million
That's profitable.
But by the smallest imaginable margin.
They will make a loss in 2011.
C.
That's profitable.
But by the smallest imaginable margin.
They will make a loss in 2011.
C.
Oh. Ok. So in 2011 you will be in a position to say that they need to return to profitability.
Ok.
Oh. Ok. So in 2011 you will be in a position to say that they need to return to profitability.
Ok.
Right now, they need to return to a level of profitability commensurate with a company with the world's largest market share rather than a level of profitability comparable to an Alaskan Koran salesman.
That's rather a mouthful.
So I prefer the more economical - "they need to return to profitability."
C.
Tell you what: If and when you sit on the board of a multi-billion dollar company that sells more product in their category than any other company in the entire world, THEN you will get to choose a new CEO.
Until then, I think I will trust the judgment of those who actually have some credibility in the industry, OK?
Shows how much you know fool, people pay to get on boards, back handed deals. i dont need to be on the board to figure out that was a bad idea getting anyone from microsoft to run that train wreck
Right now, they need to return to a level of profitability commensurate with a company with the world's largest market share
I thought market share did not count?
One need not be a business expert to know that you are totally unqualified to sit on Nokia's board of directors.
Newtron, will you STFU - you are polluting this site with your ignorant rants. Chill out and get a life.
"Nokia devices are more open and tailorable"? Hmmm. You'll have to explain that one.
I think if Nokia devices offered any tangible advantages over iPhone, they would not be seeing the collapse in confidence we are seeing now.
C.
I didn't say that they are necessarily tangible for the average consumer (or maybe they would be if marketed well enough), but even the US consumer is becoming more aware of limitations that iPhone enforces on the consumer. If the User experience and App availability become "close enough", then they may become important.
But the things that I meant are stuff like customisable ringtones for all incoming stuff (SMS, Voice, Video, IP telephony etc.), free choice off apps, open source OS (next in line), almost full customisability of the UI appearance (not behaviour), widgets, removable storage, USBOTG, USB storage mode, FM transmitter, WLAN AP functionality etc.
The closedness and huge price (900 Euros for iPhone 4) if you don't take a ball and chain from a carrier I don't want is the reason I haven't gone the iPhone route despite owning several other Apple products and propably continuing to purchase more.
That's what I meant with "more open" and with restricting consumer choice. You see, I cannot choose my operator if I want an iPhone. I don't like to be artificially restricted and limited competition leads to higher prices -> not good.
Regs, Jarkko
What I am suggesting is that the majority of mobile phone customers initially selected a carrier and then picked a handset that the carrier offered. This worked well for Nokia. Their products were well represented with all carriers.
iPhone disrupted this.
With iPhone, the consumer selected the device, and picked whichever carrier that went with it. Even if that meant moving carrier.
C.
Isn't that precicely providing less choice to the consumer? If phone A is available at one operator, then the user has no choice if he wants that phone. If phone B is available everywhere and the user wants that phone, then the consumer has more choice of operator and thereby pricing and serivices. No?
Also you get more competition and better pricing because the consumer has choice. The operator has to compete on services, coverage and pricing. If phone A is the sexiest thing on earth, the consumer has to pay whatever that single carrier chooses to offer.
And as you said, Apple didn't care what AT&T wanted, they just made a phone. Nokia's been doing that in the US for years. They've been refusing to restrict the features and functionality on most of their phones based on US carrier likes and dislikes. That's why they haven't been succesful in the US. Nokia has been pro consumer in that regard. In some others, not necessarily as much.
Regs, Jarkko
I thought market share did not count?
Profitability matters, and popular opinion has it that having a large market share is one way of achieving that goal.
Nokia has the largest market share, but weak profitability. That is actually embarrassing. Because although Nokia's unit sales are increasing, its profitability is falling.
One way of describing this is that Nokia's products are becoming commodities.
Another way is saying Nokia have lost the ability to add value.
To "save" Nokia, the trend of lower profit-per-handset has to be reversed.
C.
Isn't that precicely providing less choice to the consumer?
No.
It's the choices of consumers that now drives the market. Not the choices forced on consumers by carriers.
More precisely...
Pre iPhone, select a carrier, then select a device offered.
Post iPhone, select device, then pick carrier.
Consumers are now prepared to switch networks to get the handset they want. The ability of carriers to determine what are successful handsets has collapsed. Their influence has diminished.
This is quite a fundamental change in the way the market works.
In the UK, now all carriers now carry iPhone.
In the US, AT&T realised that customers would switch networks to get the phone.
C.