Nokia lays off 3500 employees as smartphone share continues to tumble

Posted:
in iPhone edited January 2014
Nokia's struggles to compete with Apple's iPhone and the Google Android platform continue to take their toll on the beleaguered Finnish handset maker, which announced on Wednesday that it is laying off 3,500 employees.



Nokia's cuts were described by the company as a strategy intended to "align its workforce and operations." As part of the changes, Nokia will ax 2,200 employees in closing a manufacturing facility in Cluj, Romania, while another 1,300 employees will be cut from the company's Location & Commerce business in Bonn, Germany; and Malvern, Penn.



In all, that's 3,500 employees that are estimated to be affected by Nokia's changes. The personnel reductions are expected to take effect by the end of 2012.



More cuts are likely to come, too, as Nokia revealed it is reviewing its manufacturing operations in Salo, Finland; Komamrom, Hungary; and Reynosa, Mexico. The company said it will "gradually shift" its focus toward software, with personnel at those facilities expected to be affected in 2012.



"We are seeing solid progress against our strategy, and with these planned changes we will emerge as a more dynamic, nimble and efficient challenger," Nokia President and CEO Stephen Elop said in a press release. "We must take painful, yet necessary, steps to align our workforce and operations with our path forward."



Nokia has been going through a painful transition under its new CEO, as the company has failed to respond to the success of Apple's iPhone and devices running Google Android. Nokia was once the far and away dominant worldwide smartphone maker, but it has quickly fallen in the fast-growing market.



Part of Elop's strategy is to ditch its ailing Symbian platform, and instead adopt Microsoft's Windows Phone software on its devices. The company will release its first Windows Phone devices this year, as Elop has admitted that Nokia is "feeling the heat" to bring new phones to market and stop losing market share.







Elop on Wednesday reiterated Nokia's commitment to Europe, in spite of the closings of Germany and Romania. The company is headquartered in Espoo, Finland, near the capital of Helsinki.



"In addition to our headquarters, we have a strong R&D presence in Europe," Elop said. "We have four major R&D sites in Finland and two major R&D sites in Germany, as well as Nokia Research Centers and other supporting R&D sites in Europe. Nokia also retains a strong local presence in our many sales offices throughout this region, as well as our operations in Salo and Komarom."



Nokia and Apple were previously involved in a series of patent infringement lawsuits, with each accusing the other of violation. That dispute was settled in June with Apple agreeing to an undisclosed one-time payment to Nokia, in addition to ongoing royalties.
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Comments

  • Reply 1 of 64
    That's really too bad for those affected.
  • Reply 2 of 64
    You Can Put a Fork in Nokia. Game Over. No More Lives.
  • Reply 3 of 64
    It's a little premature to write Nokia's obituary.



    The smartphone market couldn't realistically accommodate six operating systems and Nokia made the wise move to kill off Symbian. Too late? Maybe, maybe not, but we don't know right now.



    Windows Phone and RIM's QNX will battle it out for third place over the next couple of years and frankly I think Windows Phone has the upper hand as they have buy-in from some handset manufacturers.
  • Reply 4 of 64
    Quote:
    Originally Posted by stelligent View Post


    That's really too bad for those affected.



    I agree. In tech it's innovate or die.



  • Reply 5 of 64
    That's a shame. Nokia should have realized that people have high expectations from their smart phones and it's operating system, and should have switched to a more consumer aware operating system sooner. Developers can't port their applications to every smart phone OS out there, so I think with people wanting to see numerous applications in App Stores, the fallout will be there will only be a few smart phone OSes around competing with each other.
  • Reply 6 of 64
    saareksaarek Posts: 1,121member
    Quote:
    Originally Posted by mcarling View Post


    You Can Put a Fork in Nokia. Game Over. No More Lives.



    People used to say the same about Apple in the 90's. Nokia have been painfully slow to react, they were too confident of their position and are now being punished for it.



    They have a lot of talent & although I'd have liked to have seen them build on MeGo rather than betting on Microsoft I wouldn't write them off yet.
  • Reply 7 of 64






    Which is sexier? Nokia or iPhone?
  • Reply 8 of 64
    Quote:
    Originally Posted by King of Beige View Post








    Would you buy a Nokia or an iPhone?



    the brunette
  • Reply 9 of 64
    Quote:
    Originally Posted by AbsoluteDesignz View Post


    the brunette



    She deserves an iPhone...
  • Reply 10 of 64
    Quote:
    Originally Posted by cvaldes1831 View Post


    It's a little premature to write Nokia's obituary.



    The smartphone market couldn't realistically accommodate six operating systems and Nokia made the wise move to kill off Symbian. Too late? Maybe, maybe not, but we don't know right now.



    Windows Phone and RIM's QNX will battle it out for third place over the next couple of years and frankly I think Windows Phone has the upper hand as they have buy-in from some handset manufacturers.



    Maybe it was a "wise move to kill off Symbian", but doing it by issuing the burning platform memo, declaring the platform a failure and still relying on it for almost another year (yes, there might be limited availability of a WP7 Nokia phone in selected markets in November, but the full rollout is planned for early 2012)... was definitely wrong. Fact is, that Symbian sales (not market share) were still growing up to this announcement and Nokia was profitable. By now, they create losses (and most restructuring costs have not even occurred yet - laying off a total of 7500 staff members in Europe is not cheap, and Nokia may even have to pay back some subsidies in a few places). And for what? The Nokia/MS construct will never even get close to the combined market share of Symbian and Windows Mobile, unless Oracle kills Android.



    Still, the failure was not killing Symbian (it was hopeless), but killing MeeGo. I did not believe it myself (and I am neither an OpenSource nor a Linux maniac at all), but the N9 is really quite slick, and the device is the first credible alternative to an iPhone I have seen, the hardware quality is superb and the software gets the major things right (far more than I would have ever assumed a Nokia/Intel alliance to achieve). WP7 is a step back.
  • Reply 11 of 64
    Quote:
    Originally Posted by island hermit View Post


    She deserves an iPhone...



    OK, now: where's the "3.5 inches is not enough for me" downer?
  • Reply 12 of 64
    It's kind of sad seeing them struggle so much. I'd like to see them come out with a really decent smart phone.



    The best phone I ever had (when the goal was just a phone, not a smart phone) was a Nokia, 6280 I think. I was traveling internationally all the time, and it was the first phone I was given that would work in Korea and Japan as well as the rest of the world, and I loved it. It was such a benefit that it worked worldwide, but it was also really nicely built, and just a quality product.
  • Reply 13 of 64
    sflocalsflocal Posts: 4,543member
    Quote:
    Originally Posted by King of Beige View Post








    Which is sexier? Nokia or iPhone?



    In this context, three models... All do the same exact function, with virtually the same appearance.



    I'll take the one that gives me the best value for my money. In this case, any of the choices may end up costing more once I'm committed to the monthly bills.
  • Reply 14 of 64
    29922992 Posts: 202member
    Quote:
    Originally Posted by King of Beige View Post








    Which is sexier? Nokia or iPhone?



    nokia: they are TWO!!

    ...and.. iPhone looks kinda 'fake' in that picture.
  • Reply 15 of 64
    paxmanpaxman Posts: 4,594member
    Quote:
    Originally Posted by King of Beige View Post








    Which is sexier? Nokia or iPhone?



    Not sure really, but as you pointed out earlier that 'in tech its innovate or die' I gotta deduce that the one on the right is more innovative.
  • Reply 16 of 64
    Quote:
    Originally Posted by King of Beige View Post








    Which is sexier? Nokia or iPhone?



    There are cellphones in those photos?



    Thanks for pointing it out; I would not have noticed otherwise.



  • Reply 17 of 64
    gqbgqb Posts: 1,934member
    Quote:
    Originally Posted by saarek View Post


    They have a lot of talent & although I'd have liked to have seen them build on MeGo rather than betting on Microsoft I wouldn't write them off yet.



    I think they just laid off a whole bunch of that talent tho'.
  • Reply 18 of 64
    Quote:
    Originally Posted by dreyfus2 View Post


    Maybe it was a "wise move to kill off Symbian", but doing it by issuing the burning platform memo, declaring the platform a failure and still relying on it for almost another year (yes, there might be limited availability of a WP7 Nokia phone in selected markets in November, but the full rollout is planned for early 2012)... was definitely wrong. Fact is, that Symbian sales (not market share) were still growing up to this announcement and Nokia was profitable. By now, they create losses (and most restructuring costs have not even occurred yet - laying off a total of 7500 staff members in Europe is not cheap, and Nokia may even have to pay back some subsidies in a few places). And for what? The Nokia/MS construct will never even get close to the combined market share of Symbian and Windows Mobile, unless Oracle kills Android.



    Still, the failure was not killing Symbian (it was hopeless), but killing MeeGo. I did not believe it myself (and I am neither an OpenSource nor a Linux maniac at all), but the N9 is really quite slick, and the device is the first credible alternative to an iPhone I have seen, the hardware quality is superb and the software gets the major things right (far more than I would have ever assumed a Nokia/Intel alliance to achieve). WP7 is a step back.



    I agree that Meego is quite attractive paired with the N9. however, WP7 with Mango offers a truly unique, forward thinking OS. As slick as it is, Meego really only offers essentially the same functionality as ios5; one screen/mode for apps, one for notifications and one for multitasking.. WP7 offers these functionalities in a unique, live and interactive way that neither Meego, Ios5 or even Android can duplicate. I personally think is was the smartest move Nokia could have made. And remember, the N9 is essentially the same as the forthcming Sea Ray.



    Quote:
    Originally Posted by dreyfus2 View Post


    OK, now: where's the "3.5 inches is not enough for me" downer?



    He's around here somewhere.
  • Reply 19 of 64
    I wonder if Nokia will now sue every other company that makes smartphones...



    Way to go Nokia...



    Instead of putting money to create a great product and succeed Nokia tried to kill a good product (or just have passive profit over it) and failed (to a certain extent). Now, deal with your sucky moves...



    I feel bad for those loosing jobs, but on the other hand, I couldn't care less for Nokia. Its been three years I swore nobody in my family would ever get a Nokia phone again, and a few years before I was the first one to say that Nokia was great. This is something Nokia never realized, bad marketing.
  • Reply 20 of 64
    Also, in all but bureaucratic terms, it is a part of the capital, not a neighbouring city.
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