Saturday, July 18, 2009
They say that all good things have an ending sometime. Its in the collective corporate deja vu of seeing the big behemoths slowly give way to different powerful pretenders who change the market dynamics in their favor and changing once iconic brands with absolute recall to just one other struggling brand. Any number of instances can be given from Kodak to Sony, Yahoo, Motorola and now may be Nokia.
From the indication of things, Nokia is slowly losing the status as the top phone maker to strong contenders like Apple and Samsung. Nokia's business model of simple phones and high-end consumer phones which was successful for a long time got challenged with smart phones from Blackberry first and then the iconic iPhone from Apple. Nokia was for long not doing well in the North American market and that they could not break into eventually let Apple to sweep the market with iPhone. With iPhone's success, other non-traditional powerful players like Google got into the picture now making it even more tougher for Nokia to make a mark.
Nokia is being increasingly driven to consolidate its China and India markets, which will be very crucial for the Finnish giant in the coming quarters. The major threat for Nokia in these markets is that 3G will soon be available and high ARPU customers would be going in for new handsets with more innovative features like social apps and games. Nokia has to mainstream a lot of good things that it is known for like its beta lab apps in its phones and build a nice revenue model which shares attractively with content providers. Apple has done it more than once before and the results were only good. In the emerging markets it is still Nokia's sway and it will take a lot of effort to build distribution channels for the Apples and Blackberrys. Once they start trying ( Blackberry has started earnestly for the consumer pocket ), it will be even tougher for Nokia to maintain its hold. Nokia has to rediscover its nimbleness of old, and not get weighed down by its bigness.