DailyTech - Amid Struggles, Nokia Revamps Services Again

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Gadgets Amid Struggles, Nokia Revamps Services Again
Mark Kurlyandchik - June 23, 2011 9:57 AM

1 comment(s) - last by drycrust3.. on Jun 23 at 5:17 PM

A Navteq vehicle is spotted on a Finland street, updating and verifying its maps. (Source: navigadget.com)

Will incorporate Navteq into broader services business

Amid all its turmoil, Nokia is in scrambling to stay relevant (and profitable).

The latest evidence comes from a Reuters report that says Nokia is yet again revamping an arm of its business. The latest change finds the company incorporating Navteq — the independent digital-mapping unit Nokia acquired for $8.1 billion in 2008 — into its broader services business.

According to Pyramid Research, map-linked advertising is set to grow to more than $6.2 billion by 2015 though location-based services like the ones Navteq provides.

"Logically this makes sense, they merge the standalone Navteq unit with the separate location-based services business," Hannu Rauhala, an analyst at Pohjola Bank, told Reuters.

The combined unit will now be called the Location & Commerce business line, with Michael Halbherr — "an outspoken executive" according to Reuters — leading it. Halbherr joined the company five years ago and headed Nokia's massive acquisition of Navteq, the largest in the company's nearly 150-year history.

Nokia's stock price has been slashed in half over the last four months after intensified market share losses prompted the company to lower its quarterly and year-end profit outlook. Then, another high-ranking executive, CTO Richard Green, abandoned ship over disagreements of its software management plans.

With the first Windows Phone-based Nokia models not arriving until some time next year and competition from Android and Apple increasing, things are bound to get worse before they get better.

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Titanic

By drycrust3 on 6/23/2011 5:17:34 PM , Rating: 2

quote:
Nokia's stock price has been slashed in half over the last four months after intensified market share losses prompted the company to lower its quarterly and year-end profit outlook.

Nokia has a whole department of programmers that write stuff for other mobile phone companies using the Symbian platform, which means that every application they write for another mobile phone company they also have access to and could put on their own phones, which means they have nearly all the development for applications for their own phones paid for by other companies. Then the company tells the programmers they are no longer required, so it effectively wipes out a highly profitable division of the company and the almost zero cost of developing applications for their own phones. By changing to Windows Nokia has decided to lay off all those programmers and to effectively discard this highly profitable division of the company.
Obviously this will show my ignorance on the subject, but why should changing OS make such a big difference to the way software is written that you have to get rid of this highly profitable division of the company? Manufacturers don't care what platform they use on their mobile phones, they care that it looks good, that it works, that their phones cost the same or less than the competition, and that the customers won't have in warranty period problems with it. The hardware is the same, the language the applications are written in is the same, the applications are the same, maybe the cost of the OS is a bit more or a bit less, but how difficult is it to just write some conversion software that just reconfigures the application software from Symbian to the new OS?

"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer