eWEEK at 30: Glory Days of Nokia, Motorola, BlackBerry Ended With iPhone

By Michelle Maisto  |  Posted 2014-01-25 Print this article Print

The very first smartphone, though that word wasn't used at the time, was the IBM Simon. It was introduced at the Comdex tradeshow in 1992, before the world was ready for it. Simon went on sale in 1994 for $900, and over six months, just 50,000 units were sold.

Gartner's market share figures for 2001 are a near-reflection of today's ranking. There were two dominant players, the first (Nokia back then, now Samsung) with more than double the market share of the second (Motorola, now Apple) and nearly a third of the entire market. There was also a third-place player (Siemens, now Lenovo) trailing far behind with single-digit market share.  

But in 2004, Motorola pushed forward again with the introduction of the Razr V3, an "ultraslim," quad-band "video phone" made from "aircraft-grade aluminum."

"I remember the moment that I first saw the Razr," Ken Hyers, a senior analyst with Strategy Analytics, told eWEEK.

"I was working as an analyst in Boston, and I got a call saying to go to MIT and see something that would 'blow my mind.' They made me sign an NDA and they showed me some phones, and then they made me sign a separate NDA and they pulled this device out, and it was the Razr. And I was like, 'Oh my God. That is amazing! You're going to sell a million of these!'"

Hyers laughed. "Of course, they sold a few more than that. They really did get their moment in the sun."

The Razr became a high-end style statement for consumers and a money-maker for Motorola, which made several hundred dollars off of each $500 phone.

Over four years, Motorola sold 130 million Razrs. But by 2007—the year the iPhone debuted—a Razr could be had for $30 with a two-year contract. By that time Motorola, having ridden the Razr's coattails for too long, was in a shambles.

"Motorola invented cell phones. The problem was that they didn't keep up with the marketplace and they let Nokia bypass them," said Gold. "Motorola went after the higher end of the market, and they didn't see the mass market coming—at least not fast enough to keep up. Nokia out-innovated them."

Nokia's portfolio had become vast. As early as 2003, it had introduced the 6600, a smartphone that ran the Symbian OS and featured an XHTML Web browser, email, a VGA camera, a multimedia card expansion slot, a RealOne music player, Bluetooth and an infrared port. The same year, it put out the 1100, something of a less-expensive take on the 2100 for developing markets and of which Nokia ultimately sold more than 200 million units.

The Symbian OS was a significant development past "dumb" feature phones, and "they made Nokia king," said Kay.

"Nokia's fall can be dated to the arrival of the iPhone," Kay added. "Apple killed Nokia right away, but Nokia didn't know it was dead for a couple of years."

Innovating Alongside the Consumer Market

"What's the surest sign that a product has become a pop-culture phenomenon? When it becomes generic," George Stephanopoulos wrote in the 2005 Time 100—a list of the year's most influential ideas and people. He categorized the BlackBerry mobile phone, the brainchild of Mike Lazaridis and Jim Balsillie, alongside Kleenex, Jell-O and Xerox.


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