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Commentary: What now for Nokia and Windows Phone?

April 9th, 2012 | by Alfred Siew
Commentary: What now for Nokia and Windows Phone?
Cellphones
10

Over the weekend, against the advice of many, I bought my dad a Nokia Lumia 800.

I know, not many phone buffs are giving Windows Phone devices much chance after a somewhat disappointing holiday season last year, when the Finnish cellphone maker was estimated to have sold a modest million or so Lumia phones.

But it is a little early to write off Windows Phone devices, and they can still go places, if only they can get some traction. My dad had bought an LG Optimus 7 a couple of years ago and it had provided a nice, easy way to join the smartphone bandwagon with the operating system’s tile-based system.

The Lumia 800 was thus a natural upgrade. Again, the large tiles make for easy navigation. The updated Windows Phone 7.5 provides for multi-tasking. The interface is fast, and the 8-meg camera, based on Carl-Zeiss optics, is no slouch.

Indeed, folks like my dad are the type of users that Microsoft and Nokia need to convince, even as many reviewers and techies glowingly praise both Windows Phone and Nokia’s Lumia range, including the latest Lumia 900 shipping in the United States this weekend. 

The problem is, many of these techies, myself included, are not actual Windows Phone users. While we love that Microsoft and Nokia are providing an alternative ecosystem to Android and iOS, we have stuck to our favoured devices because we have had so much invested in them.

To us, the Lumia 800 is a great device that we can recommend to friends and relatives buying a first smartphone, but we are not prepared to switch over. We don’t see a compelling need to, given how familiar we are with our apps and interfaces.

That, in a nutshell, is the type of odds stacked against Microsoft and Nokia. There is more worry than optimism even when they ship the new flagship Lumia 900, which boasts of speedy LTE (long term evolution) mobile broadband and a larger 4.3-inch screen, for a low US$99.99 on an AT&T contract now.

Nokia and Microsoft are doing the right thing in targeting the new user with a low-cost but full-featured handset – geeks buying an HTC One X or upcoming Samsung Galaxy S III won’t give them up for a Lumia 900 – but the Windows Phone camp must realise that the window is closing fast to attract such new users.

Nokia should know. For years, its excellence in design and simplicity gained fans who were hard to prise away, no matter how hard Motorola, Sony Ericsson or Samsung tried. Then came the smartphone, which rewrote the script and has returned new winners and losers ever since.

In the past few years, the more Nokia lost ground, the stronger a foothold its rivals gained. Apps are one reason why it is so hard for Nokia to overturn that. Branding and design, another. On both counts, Nokia and Microsoft have lost so much ground before they joined hands early last year that they have all the work to do in 2012 to claw back some of it.

For starters, they’d need a good product. They have got the software done well in Windows Phone 7.5, with its simpler system of displaying information. The People feature, which lists all your friends’ interactions with you over e-mail, Facebook and chat, for example, is a refreshing change from the icon-driven menus of its rivals.

In the Lumia 800 and Lumia 900, they have superbly designed devices that break new ground as well with the polycarbonate body and a stunning “pillowy” screen. Problem is, the contest is no longer about products, but one about scale and momentum.

Sure, Microsoft and Nokia can spend US$24 million to lure developers to come up with the next big thing on the small screen. Nokia itself can boost its previously laggard image with huge Times Square concerts for its Lumia 900 launch.

But their best hope lies in the millions of users who are yet to use a smartphone for the first time. Developing markets such as India and Indonesia, where Nokia has been strong traditionally, are where its game has to be spot on.

Users there are not as entrenched in their preferences. They may have seen the iPhone – and want it – but if Nokia comes along with a Lumia that offers a great experience for a low price, they would be more willing to take a chance with Windows Phone than, say, a user of the iPhone.

In other words, Microsoft and Nokia should spend more time trying to win over new users rather than convert users of iPhone or Android OS devices. There’s another player, Blackberry, whom they can grab market share from, and they should.

Indonesia, for one, has been a big Blackberry market, mainly because of affordable telco tariffs on Blackberry Messaging (BBM). If Nokia and Microsoft, along with local developers, could come up with a bundle of services that enhances that experience for the country’s messaging-crazy audience, they could sell many Windows Phones there.

The strength of the operating system, after all, is in its easy-to-pick-up tile-based user interface. In my case, I had considered HTC’s excellent One V, a smaller Android phone that boasted the Taiwanese phone maker’s snazzy new camera system, for my dad, but in the end, the Lumia 800 won both of us over.

It provided an easier interface, compared to the One V, admittedly a much cheaper phone. The Lumia 800’s large fonts and easy-to-tap tile system really help to get a new smartphone user acquainted to a new way of getting and sharing information. And once they get acquainted, they will prefer a familiar Windows Phone in future, as my dad did.

That may be the key for Microsoft and Nokia for 2012: keeping the small base that they have and trying to expand to fresh smartphone markets. For the last quarter of 2011, Nokia scraped by with just 12.4 per cent of the smartphone market, according to research firm IDC. And analysts are not sure how well the new Lumia 900 will do this year.

Estimates by some range from a low of 140,000 to a high of 680,000 units sold a quarter in the US, which is a shadow of the 7.6 million iPhones that AT&T turned on in the last quarter of 2011, thanks to the introduction of the iPhone 4S.

In the end, the fate of Windows Phone could come down to a matter of staying power.

If pumping dollars into the system only gets Microsoft and Nokia a small share in return, and if selling its high-end phones on the cheap doesn’t do it, then surely questions will be raised on whether the fight is worth it in the long run. The next eight months in 2012 could be make or break time.

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10 Comments

  1. Pingback: The Very Strange Easter Sunday Launch Of The Nokia Lumia 900 – Forbes | WindowPhone7 Reviews, photos and News

  2. Fernandez says:

    Nokia announced end of Symbian, a well selling phones. Symbian sales dropped sharply

    Nokia too 1 year to come up with its first Windows Phone. In the mean time, iOS and Android ate up all Symbian market share. Further, because Windows Phone is not as good as iOS and Android, Nokia cannot even regain its Symbian market share!

    All this is due to ( illegal / bribed / intentional ) mis-management, clearly. Otherwise, nobody will kill a well selling Symbian phones and produce bad Windows Phone phones that too after one year. A clear case of bribing.

  3. Gautam says:

    MS-Nokia illegal parternship :

    1. Killing a very well selling Symbian OS. Last year Symbian sold 18 million, and because now Stepen Elop announced its end (killing it), its selling at hardly 1 million. Killing Symbian reduced one competetor to Windows Phone, but in fact iPhone and Android are the real gainers and not the WP. Poort MS and poort Nokia. This clearly shows how bad WP OS is.

    2. Making Nokia to produce only WP phones even though Nokia knows WP has been proven to be a dead platform. WP is in the market for many years and few years back it had 40% market share. Once iPhone and Android arrived, its market share went to below 2% because WP 7 is not as good as iOS and Android.

    There is still time for Nokia to revive if it cancels the partnership and put Android on its Lumia phones. Nokia investors have to wake-up and do this.

    Nokia can continue manufacturing WP phones, but not only WP phones. It will be completed killed in next 1-2 years if it continues only-WP policy. And, if it puts free Android on its Lumia phones, they will sell hot. But, this is not possible as long as that Stephen Elop is the Nokia CEO. At-least Finnish Govt should wake up and save Nokia.

    • Ghulam says:

      Yes, Nokia should not force customers to use only Windows Phone. It should offer Android and Symbinal OS as well, just like how HTC and Samsung do. Nokia’s CEO Stephen Elop ( ex-Microsoft employee ) naturally takes decision for Microsoft and not for Nokia. His plans to boost Windows Phone :

      – No-Symbian policy ( this killed Nokia partially )

      – Only-WP policy ( this will kill Nokia completely in next 1-2 years )

      In an attempt to boost Microsoft Windows Phone through Nokia, Stephen Elop will kill Nokia in above 2 steps. And, needless to say, he would have got huge amount from MS already and will return to Microsoft once Nokia is no more

      Think. Why are Nokia investors and directors sleeping ? Why can’t Nokia use Android when customers are asking heavily ? If Nokia comes back with Android, it will be at-least saved though it cannot become number one manufacture quickly.

  4. Shuba says:

    Why analysts estimated that Lumia would sell 500K in a quarter? Because, everybody know that it is a JUNK product, because of Windows Phone OS. Had it been with Android, same Lumia would have sold 100K per day. Microsoft is illegally using Nokia to sell Windows Phone through Stepen Elop, and the whole world knows it how much illegal their relationship is. If Microsoft can sell its OS to several vendors, why can’t Nokia try with different OS and offer what customers need? Why Nokia is stick to only Windows Phone? By doing so, Nokia has become a manufacturing arm of Microsoft. And, because of this, Nokia will be vanished in 2-3 years, and the root cause is a very bad Windows Phone OS. Shame on Nokia investors for not cancelling the MS-Nokia parternership, and not firing Elop immediately and not going with Android. So many people are waiting for Nokia hardware + Andorid OS phones. Thus, Lumia 900 does not make any difference as long as it has that junk Windows Phone OS.

    • Ghulam says:

      Yes, you are right. Nokia investors shouldn’t have selected a Microsoft employee as their CEO. The world knows how Microsoft has been using all the bad and illegal business tactics to sell its products. So, people no more like Microsoft. Further, it’s mobile OS is in the market for a long time and has been proven to be a failure. Compare WP’s homescreen with that of Android/iOS. The latter look damn good. Still, knowing that WP is a failure and has no future, Nokia partenered with Microsoft to produce only WP and killing well-selling Symbian OS. Microsoft managed this by bribing Stepen Elop and some directors. The end result will be that Microsoft loses money and Nokia goes to death. Even with Nokia producing Lumia 610 / 700 / 800 / 900, Windows Phone can’t sell more than 1 million units in a quarter, whereas iPhone and Androids are each selling  nearly 1 million units daily.

  5. Whodaboss says:

    “…somewhat
    disappointing holiday season last year, when the Finnish cellphone maker was
    estimated to have sold a modest million or so Lumia phones.”

    I find this
    statement strange. Why? Because there were many reports that stated the Lumia’s
    would have sold less than five hundred thousand. Yes less than 500K. Yet, once
    the Lumia’s sold more than a million or so, then somehow that became
    disappointing. If the so called analyst and techies predicted less than 500
    units would be sold and there were more than a million sold would that not be
    considered a success? That’s more than a 100% than what was predicted. But no.
    Because it’s MS and Nokia then there must be a negative spin on it to suit the
    fancy of those who were completely wrong. Of course there can’t be any
    correction, because that wouldn’t fit the narrative trying to be placed on MS
    and Nokia.

    “…And
    analysts are not sure how well the new Lumia 900 will do this year.

    Estimates by some range from a low of 140,000 to a high of 680,000 units sold a quarter in the US…”

    Here we go
    again. If the Lumia 900 sells a million units by any measure that would be a
    success based on the predictions. But somehow I believe those writing these types
    of articles would anticipate most people would have forgotten the early prognostications
    and start with … The Lumia 900 sold a million units but that was a
    disappointing result.

    • Alfred Siew says:

      Hiya, I agree that analysts and techies are not often right. Actually, analysts also expect Microsoft to blow past iOS by 2015 to be the number two OS. Though there’s still a bit of time for that, the Windows camp is not rolling up numbers in that fashion. 

      In contrast, Apple’s iPhone 4S was a surprise hit, given that it was a mere refresh. I think you’re right in that Windows Phone has been unfairly written off. There is still a lot of smartphone market to fight for and I feel Windows Phone is a good OS. I’ve put my money where my mouth is as well! :)

    • Shubha says:

       Why analysts estimated that Lumia would sell 500K in a quarter? Because, everybody know that it is a JUNK product, because of Windows Phone OS. Had it been with Android, same Lumia would have sold 100K per day. Microsoft is illegally using Nokia to sell Windows Phone through Stepen Elop, and the whole world knows it how much illegal their relationship is. If Microsoft can sell its OS to several vendors, why can’t Nokia try with different OS and offer what customers need? Why Nokia is stick to only Windows Phone? By doing so, Nokia has become a manufacturing arm of Microsoft. And, because of this, Nokia will be vanished in 2-3 years, and the root cause is a very bad Windows Phone OS. Shame on Nokia investors for not cancelling the MS-Nokia parternership, and not firing Elop immediately and not going with Android. So many people are waiting for Nokia hardware + Andorid OS phones. Thus, Lumia 900 does not make any difference as long as it has that junk Windows Phone OS.

  6. Pingback: Commentary: What now for Nokia and Windows Phone? – Techgoondu | WindowPhone7 Reviews, photos and News

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