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Nokia

Nokia

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Published by: Zwiziegirl Fuentes on Mar 09, 2011
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10/06/2011

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Nok|ať a Great Company |n a 1urbu|ent

Market
ln lLs november 2002 speclal reporL on nokla versus
MlcrosofLţ Lhe £cooomlst reporLed
LhaL ln 2002ť 400 mllllon phones were sold (10 per
cenL wlLh bullLŴln moblle cameras)ţ
Lhere were now more Lhan 1 bllllon moblle phone
usersţ more moblle
phones Lhan flxedŴllne phonesţ and Lhe number of
lnLerneLŴconnecLed phones ls
overLaklna Lhe number of lnLerneLŴconnecLed ÞCsŦ
1he laLesL phonesţ wlLh colour
screensţ camerasţ muslc plavers and downloadable
aamesţ have as much compuLer
power as Lhe deskLop compuLer dld Len vears aaoŦ
?eL 'Lhe Lroubled swlLch Lo 3C
Lechnoloav means Lhe moblle Lelecom lndusLrv ls ln
Lurmoll'ť

- 1he markeL for handseLs ls saLuraLed afLer nearlv a
decade of doubleŴdlalL
arowLhŦ SevenLv per cenL of Luropeans and 30 per
cenL of Lhe uS populaLlon
now own a moblle phoneŦ

- 8evenues from volce calls are flaL Ŷ so companles
are looklna Lo new servlces
such as phoLo messaalnaţ aamlna and locaLlonŴbased
lnformaLlon for revenue
arowLhŦ

- Wlreless AppllcaLlon ÞroLocol (WAÞ)ţ a cuLŴdownţ
slmple appllcaLlon of Lhe Webţ
has falled Lo exclLe users or aeneraLe revenue
sLreamsŦ

- 3C servlces have been delaved evervwhere and are
onlv [usL appearlna ln
LuropeŦ

So who are Lhe kev plavers ln Lhls complex and
LurbulenL lndusLrv?
noklaţ MoLorolaţ Slemensţ Sonvţ Lrlcsson and
Samsuna make abouL 80 per cenL
of Lhe phonesŦ 1hev also have a [olnL venLure ln
Svmblan sofLwareţ an open and
flexlble sLandard LhaL permlLs compaLlblllLv and
consLanL lnnovaLlonŦ 1here are oLher
alllances such as Lhe Moblle Þrocessor lnLerface
Alllance and Lhe ulalLal Pome
Worklna Croup whlch are also promoLlna
compaLlblllLv and ease of useŦ 1he moblle
phone operaLors (vodaphoneţ Cranaeţ 1Ŵmoblle and
C2 ln Lhe unlLed klnadom)
acL as Lhe hub beLween cusLomersţ handseL makers
and conLenL provldersŦ Manv
of Lhem are saddled wlLh huae debLs afLer pavlna
bllllons for 3C llcencesŦ
Success ln 3C wlll depend on flndlna wavs of selllna
conLenL and servlcesť
boLh Lhe medla companles and Lhe banks could
enLer Lhe markeL as 'moblle
vlrLual neLwork operaLors' (MvnCs)Ŧ CurrenLlv
8skv8ţ vodaphone and 3 are blddlna
for Lhe rlahLs Lo show nlneLvŴsecond cllps of premler
fooLball maLches (1lmesţ
6 AuausL 2003)Ŧ

8uL 3C ls also an opporLunlLv for Lhe !apanese and
korean manufacLurers Lo enLer
Lurope and for Lhe Luropeans Lo enLer !apanŦ
Lrlcsson ls Leamlna up wlLh Sonv
and 1oshlba wlLh SlemensŦ Samsunaţ alreadv
domlnanL ln korea and Amerlcaţ
has a Lrack record of produclna rellableţ easvŴLoŴuse
phonesŦ And on Lhe uk hlah
sLreeL Þhones 4u ls launchlna a hlahŴsLreeL prlce war
almed aL rlvals Carphone
Warehouse and Lhe Llnk ln a drlve Lo become markeL
leader (1lmesţ 4 AuausL 2003)Ŧ
nokla ls Lhe ma[or plaver ln Lhe moblle phone
markeLŦ lLs share of Lhe alobal
markeL lncreased from 36 per cenL ln 2002 Lo 39 per
cenL ln 2003 (30 per cenL ln
Lurope) Ŷ lL ouLsells lLs Lhree closesL rlvals
comblnedŦ lL now has annual sales of
uS$30 bllllon across 130 counLrlesţ selllna flve
phones everv secondŦ lL has core compeLences
ln radlo Lechnoloavţ dlalLal slanal processlnaţ
elecLronlcs manufacLurlnaţ
sofLware plaLforms and archlLecLureŦ Accordlna Lo
Lhe £cooomlstţ nokla's Serles 60
sofLware could veL emerae as Lhe moblle equlvalenL
of MlcrosofL's WlndowsŦ 1he
companv has a Lrack record of deslan lnnovaLlonsţ
lncludlna userŴchanaeable
handseL coversţ scrollŴdown LexL bars and predlcLlve
LexL messaalnaŦ lL lnLroduced
LhlrLvŴfour new phones ln 2002 and ls headlna for a
slmllar number ln 2003Ŧ lorLv
per cenL of lLs emplovees are lnvolved ln 8Ǝuţ whlch
accounLs for a sLeadv 10 per
cenL of sales and an annual spend of uS$3 bllllon ln
2002Ŧ

Slnce 1999 nokla has presenLed lLself as Lhe world's
leadlna deslan house
for moblle communlcaLlonţ launchlna lLs model 8210
durlna Lhe 1999 Þarls fashlon
week and porLravlna lLs phones ln Lhe medla as
culLural arLefacLs and lconsŦ
Survevs show LhaL consumers raLe nokla above all
oLher moblle phone brandsţ lLs
cusLomers are more loval Lo nokla Lhan Lo Lhelr
moblle phone operaLorţ and ln 2002
nokla was Lhe world's slxLh mosL valuable brand
valued aL some uS$30 mllllon
(lnLerbrand)Ŧ Club nokla enables lL Lo keep close Lo
lLs cusLomers and sell unlLs
and accessorles LhaL would normallv ao vla Lhe
Lelephone operaLor or reLallerŦ

1he companv has a flaLţ nonŴhlerarchlcal sLrucLure
based around nokla Moblle
Þhonesţ nokla neLworksţ nokla venLures
CraanlzaLlon (lncludlna an lnslahL and
loreslahL Leam whlch seeks ouL dlsrupLlve
Lechnoloalesţ new buslness models
and promlslna enLrepreneurs) and nokla 8esearch
CenLreŦ lLs moblle phone
buslness has been furLher dlvlded around nlne
buslness seamenLsţ lncludlna one
focused on CuMA neLworksţ an enLrv producL aroup
almed aL emeralna markeLsţ
an lmaalna aroup produclna camera phonesţ a
aamlna and enLerLalnmenL
aroup (responslble for Lhe nŴaaae aames machlne)
and a buslness devlces aroup
(responslble for a new phoneţ moblle eŴmall and
messaalna machlnes)Ŧ
!orma Clla has been wlLh Lhe companv slnce 1983
and slnce 1990 has led Lhe
LurnŴround and arowLh sLraLeav wlLh four close
colleaauesŦ 'AlmosL everv asslanmenL
ls alven Lo a Leamţ and manaalna Lhe companv ls no
excepLlonŦ' CollaboraLlve
worklna ls encouraaedţ and nokla ls lnvolved ln a
wlde ranae of [olnL and
collaboraLlve venLures almed aL arowlna Lhe markeL
and maklna llfe easler for Lhe
consumerŦ now half Lhe emplovees are ouLslde
llnlandţ leadlna ottooe Lo quoLe one
of nokla's Amerlcan dlrecLorsť 'nokla ls ln Lhe unlque
poslLlon LhaL lL has aoL a
aroup of manaaers LhaL have been worklna LoaeLher
for vears Ŷ and now Lhev've aoL
a loL of senlor people from ouLslde who can shake
Lhlnas up' (ottooeţ Mav 2000)Ŧ

nokla ls ln Lhe Luropean ottooe 'Lop Len' companles
Lo work forţ and Lhe nokla
wav comprlses a seL of values and a sLraLealc
plannlna process LhaL encouraaes
parLlclpaLlve conLrlbuLlonţ a clear sense of dlrecLlon
and dlsclpllned execuLlonŦ
A new P8 dlrecLor has lnLroduced uparaded
performance manaaemenL and
reward processesŦ Poweverţ lLs moblle Lelecom
equlpmenL buslness (where nokla
compeLes aaalnsL Lrlcssonţ LucenLţ norLel and
MoLorola) ls lossŴmaklna because
of caplLal spendlna cuLs bv Lhe Lelecoms operaLorsŦ
nokla ls also plavlna caLchŴup
ln Lhe CuMA markeL (Lhe dlalLal sLandard
champloned bv Cualcomm of San uleao
and adopLed bv mosL uS cellular operaLors)ţ Lhe
fasLesLŴarowlna secLor ln Lhe unlLed
SLaLes and Aslaţ of whlch lLs share ls less Lhan 10 per
cenLŦ

neverLheless Lhe £cooomlst predlcLs an lnLeresLlna
baLLleţ concludlna LhaL 'nokla
has achleved lLs domlnance noL Lhrouah ownershlp
of proprleLarv Lechnoloav buL
from lLs ablllLv Lo lnnovaLe around open sLandardsţ
from lLs sLrona brand and from
lLs lmpresslve loalsLlcs'(23 november 2002)Ŧ




5ootcesť '1he lnLerneL unLeLhered'ţ £cooomlstţ 11
CcLober 2001Ť 'nokla vŦ
MlcrosofLť Lhe flahL for dlalLal domlnance'ţ
£cooomlstţ 23 november 2002Ť
'CompuLlna's new shape'ţ £cooomlstţ 23 november
2002Ť 'Calllna for a renewable
fuLure'ţ fstcompfov 70ţ Mav 2003Ť '1en areaL
companles Lo work for'ţ ottooeţ March
2002Ť 'WhaL makes nokla so aood?' ottooeţ Mav
2000Ŧ

Ou£51lON5
1 1o whaL exLenL ls Lhls an aLLracLlve markeL Lo be
ln?
2 WhaL are nokla's maln sLrenaLhsţ weaknessesţ
LhreaLs and opporLunlLles?
3 lrom nokla's perspecLlveţ produce a besL and
worsL case scenarlo
for 2007Ŧ

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