Close
  • Latest News
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Logo
  • Latest News
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home Applications
    • Applications
    • Mobile
    • Networking

    Nokia Down, but Not Out in Smartphone Market: IDC

    By
    Robert J. Mullins
    -
    June 18, 2012
    Share
    Facebook
    Twitter
    Linkedin

      Nokia and Microsoft both needed each other for Nokia to try to regain its smartphone dominance and for Microsoft to build sales of Windows Phone 7 devices. But analyst Ramon Llamos of IDC thinks both can still pull it off once Nokia gets its act together.

      Doubts about whether Nokia could deliver for Microsoft were raised again last week when the Finnish phone maker announced about another 10,000 layoffs, on top of 20,000 previously announced, and another $2 billion in other spending cuts between now and the end of next year.

      It also announced plans to shutter factories in Canada, Finland and Germany, according to news reports. This news comes just as Nokia is trying to roll out the first models of smartphones running Microsoft’s Windows Phone 7 OS, which itself has had a slow start competing against phones running Google’s Android OS and iPhones running Apple’s iOS.

      Nokia’s troubles have also raised the possibility that it might be the right time for Microsoft to buy Nokia. Microsoft offered a curt no comment when asked if it was thinking of acquiring Nokia.

      While the Windows Phone Summit, scheduled for this Wednesday and Thursday in San Francisco, will be a developer-focused event covering what is expected in Windows Phone 8, the successor to WP7, questions are expected on the status of the Microsoft-Nokia partnership.

      But when asked if Nokia’s apparent weakness means Microsoft bet on the wrong horse to build traction for WP7, IDC analyst Ramon Llamas replied, “Absolutely not.”

      “[Nokia] is in the midst of a very challenging transition,” Llamas said, referring to the move from its original Symbian OS to WP7. “But Nokia brings a lot of great stuff to the table; smartphone expertise, a very strong brand and awesome distribution worldwide.”

      But all those qualities have failed to keep Nokia in the game, as IDC’s own numbers show. For the first time in years, Nokia fell from first place in the rankings for worldwide sales of mobile phones (including smartphones) in the first quarter of 2012. Nokia fell to third place with unit shipments of 11.9 million, behind Apple’s 35.1 million units and No. 1 Samsung’s 42.2 million. Nokia’s market share plummeted to 8.2 percent, from 23.8 percent in the first quarter of 2011. Nokia’s sales fell by 51 percent in the same quarter, while Apple’s rose by 88 percent and Samsung’s by 267 percent.

      Still, Nokia should get some credit for loyalty by going “all in” for Microsoft, said Llamos, while other smartphone makers “hedged their bets” by introducing some WP7 devices but mostly peddling smartphones running Google Android.

      While still confident of Nokia’s ability to pull out of this dive, Llamos is concerned that during a conference call announcing the cutbacks, Nokia executives said that many of the cuts will be in research and development (R&D). While R&D cuts provide some immediate cost savings, R&D is the future for any company, especially in the smartphone business where device makers are constantly pressured to come up with the next big thing, he said.

      “Nokia’s going to have to be very strategic, very nimble and a very sharp, [with a] laser focus as to where it’s going to concentrate its resources today and tomorrow,” Llamas said.

      But others are much more bearish on Nokia. The Finnish news Website News24 noted that Nokia’s long-term credit rating has been downgraded to junk status and quotes an analyst saying that Nokia’s deal with Microsoft “was the wrong strategy from the beginning.”

      “Basically, they must succeed or die,” said Andalys Oy analyst Ari Hakkarainen.

      And the U.S.-based magazine Smart Money argued in a June 18 report that Microsoft should acquire Nokia in order to save it.

      IDC’s Llamos considers that scenario unlikely, given Microsoft’s disastrous experience with the KIN One and KIN Two smartphones it rolled out in April 2010, only to kill them off in July of that year as a flop. He then added: “If Microsoft were to acquire Nokia, not only does that expose Microsoft to the gigantic market of smartphones, but also feature phones that the company has virtually no presence in.”

      Robert J. Mullins
      Robert Mullins is a freelance writer for eWEEK who has covered the technology industry in Silicon Valley for more than a decade. He has written for several tech publications including Network Computing, Information Week, Network World and various TechTarget titles. Mullins also served as a correspondent in the San Francisco Bureau of IDG News Service and, before that, covered technology news for the Silicon Valley/San Jose Business Journal. Back in his home state of Wisconsin, Robert worked as the news director for NPR stations in Milwaukee and LaCrosse in the 1980s.

      MOST POPULAR ARTICLES

      Cybersecurity

      Visa’s Michael Jabbara on Cybersecurity and Digital...

      James Maguire - May 17, 2022 0
      I spoke with Michael Jabbara, VP and Global Head of Fraud Services at Visa, about the cybersecurity technology used to ensure the safe transfer...
      Read more
      Big Data and Analytics

      Alteryx’s Suresh Vittal on the Democratization of...

      James Maguire - May 31, 2022 0
      I spoke with Suresh Vittal, Chief Product Officer at Alteryx, about the industry mega-shift toward making data analytics tools accessible to a company’s complete...
      Read more
      Big Data and Analytics

      GoodData CEO Roman Stanek on Business Intelligence...

      James Maguire - May 4, 2022 0
      I spoke with Roman Stanek, CEO of GoodData, about business intelligence, data as a service, and the frustration that many executives have with data...
      Read more
      Applications

      Cisco’s Thimaya Subaiya on Customer Experience in...

      James Maguire - May 10, 2022 0
      I spoke with Thimaya Subaiya, SVP and GM of Global Customer Experience at Cisco, about the factors that create good customer experience – and...
      Read more
      Cloud

      Yotascale CEO Asim Razzaq on Controlling Multicloud...

      James Maguire - May 5, 2022 0
      Asim Razzaq, CEO of Yotascale, provides guidance on understanding—and containing—the complex cost structure of multicloud computing. Among the topics we covered:  As you survey the...
      Read more
      Logo

      eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Advertisers

      Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

      Advertise with Us

      Menu

      • About eWeek
      • Subscribe to our Newsletter
      • Latest News

      Our Brands

      • Privacy Policy
      • Terms
      • About
      • Contact
      • Advertise
      • Sitemap
      • California – Do Not Sell My Information

      Property of TechnologyAdvice.
      © 2021 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

      ×