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Nokia CEO Stephen Elop

"S**t just got real"
Nokia CEO Stephen Elop tells his troops that it's time to face the music

It appears that Nokia's CEO has come to the realization that many of us came to months, if not years ago: Nokia's smartphone efforts are in trouble. The company has been a bit lacking on the innovation front and has never quite made its way back into the hearts of the consumer -- especially in North America -- since the arrival of the iPhone in 2007.

Stephen Elop, a former Microsoft Business Division executive, took over Nokia's CEO position back in late September. It didn't take long for him to see the writing on the wall when it comes to Nokia's position in the market, and he fired off a memo (which was obtained by Engadget) to state the sad position that the company is in. In fact, Elop says that the Nokia is standing on a "burning platform" and that the company must decide what it wants to do to stay relevant.

Here are a few highlights from the 1,300+ word memo:

In 2008, Apple's market share in the $300+ price range was 25 percent; by 2010 it escalated to 61 percent. They are enjoying a tremendous growth trajectory with a 78 percent earnings growth year over year in Q4 2010. Apple demonstrated that if designed well, consumers would buy a high-priced phone with a great experience and developers would build applications. They changed the game, and today, Apple owns the high-end range… The first iPhone shipped in 2007, and we still don't have a product that is close to their experience. 

Love 'em or hate 'em, it's true that Apple really turned the smartphone market on its head. Apple knows how to create buzz for its products, and while the iPhone may not have the most dazzling array of hardware at any point in time compared to its competitors, the user experience (hardware + software ecosystem) is hard to fault.

Elop goes on to praise Google's Android platform which has taken a few short years to topple Nokia from the top of the worldwide sales charts:

Android came on the scene just over 2 years ago, and this week they took our leadership position in smartphone volumes. Unbelievable…

Android came in at the high-end, they are now winning the mid-range, and quickly they are going downstream to phones under €100. Google has become a gravitational force, drawing much of the industry's innovation to its core.

Elop continues in his memo talking about the company’s unhinged efforts with MeeGo, troubles with Symbian, and the fact that Chinese OEMs are able to crank out low-cost smartphones at a rapid pace. Basically, Nokia is being assaulted from all sides and isn't taking enough action to stay relevant. 

Nokia's CEO even goes so far as to say that the answer to Nokia's problems may be to adopt smartphone platform which has a strong ecosystem (Android, Windows Phone 7 perhaps?). Windows Phone 7 seems like a good choice given Elop's past ties to Microsoft, but we'll hear a little more about Nokia's plans for the future on February 11. 

You can read Stephen Elop’s full memo here.

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RE: ?
By bah12 on 2/9/2011 9:55:57 AM , Rating: 2
Oh and to my quote from your post...yes it is nice. To paraphrase Louis CK.

I'm not saying people that are well off are better, just that being well off is CLEARLY better. Who could even argue that. If it were and option I'd reup every year.

RE: ?
By The Raven on 2/9/2011 12:15:49 PM , Rating: 2
I think you missed his point. I think he is saying that it is not a smart choice (in his opinion, for himself) but that many other people do not get that (for themselves) despite the 'great recession' that we experienced.

I too am surprised that people waste money the way they do. I used to work at Hollywood Video and we introduced a program that made it highly economical for frequent renters save a buttload of money (>%50 of their cost) if they would just wait 2 weeks to get new releases. (Brings to mind people waiting in line for hours/days for an iPhone/copy of COD:BOps)

But they could not even wait 2 weeks to see the movies. I told them, "Hey, you've waited 3-6 months to see it on DVD, you may as well wait another 2 weeks to save a ton of $$$!"

But the answer was almost always 'no'.

Did it keep them entertained and 'busy', yes. Were they movie critics (more specifically DVD critics lol), no. THerefore they could make no $$ with it and it was economically a waste. Just like the iPhone is a big money suck for (I would guess at least >50% of) the people who buy them.

RE: ?
By ClownPuncher on 2/9/2011 3:20:59 PM , Rating: 2
Well, it's more about not wanting to sign up for things and not wanting to be hassled by the clerk at the counter, it's not about wanting to waste money.

RE: ?
By ClownPuncher on 2/9/2011 3:22:19 PM , Rating: 1
"Well off" = white.

RE: ?
By bah12 on 2/9/2011 4:52:03 PM , Rating: 2
Just don't travel to the future though :)

RE: ?
By ClownPuncher on 2/16/2011 7:57:21 PM , Rating: 2
Rate me down, because I actually wrote what Louis CK said in his stand up. Tip: CK never used "well off" in that joke.

"This week I got an iPhone. This weekend I got four chargers so I can keep it charged everywhere I go and a land line so I can actually make phone calls." -- Facebook CEO Mark Zuckerberg

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