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Entries in Elop (1)

Friday
Feb112011

Elop's shock treatment may be too late to save Nokia

Nokia. Where were we?

Oh yeah, its market share has fallen by a quarter in the last two years.

And its CEO, who’s reportedly planning to defenestrate much of the top executive suite and deploy Microsoft’s Windows Phone 7, has called on the shrinking giant to make a “radical change” in its behaviour.

Elop’s already-infamous “burning platform” email – clearly intended to be leaked - echoes pretty much what every analyst has been saying:

The first iPhone shipped in 2007, and we still don't have a product that is close to their experience. Android came on the scene just over 2 years ago, and this week they took our leadership position in smartphone volumes. Unbelievable.

Nokia is being squeezed from above and below. As FT's Richard Waters puts it:

Nokia also faces an attack on its hardware margins from Chinese suppliers selling to emerging markets. Unlike IBM two decades ago, however, it finds the high ground of software and services already occupied – in this case, by Apple and Google. And Nokia’s own attempts at services, with moves such as its $8bn acquisition of mapping company Navteq and its “Comes with music” phones, have largely failed.

Just today Digitimes reports that China-based handset vendors are prepping sub-$100 Android smartphones in the BRIC markets.

Laments Elop:

While competitors poured flames on our market share, what happened at Nokia? We fell behind, we missed big trends, and we lost time. At that time, we thought we were making the right decisions; but, with the benefit of hindsight, we now find ourselves years behind.

It’s the right message, but may be too late. Indeed, if Nokia truly thinks WP7 is the answer, the burning platform may be destined to sink.