Nokia and the USA: Time to jump in on the conversation
By Stefan Constantinescu on Tuesday, February 13th, 2007 at 7:52 PM PST In Ideas and rants
All my favorite Nokia (NYSE: NOK)/S60 bloggers recently started ranting about Nokia’s USA situation. I call it a "situation" since the 4th quarter 2006 earnings report (read the pdf) presents some pretty troubling figures.
Before we can have a rational discussion, let us look at some numbers. The following charts have been extracted from the 4Q2006 Nokia Earnings Report PDF:
Nokia shipped 39.8% fewer phones in North America Q42006 than in Q42005. This is a substantial reduction in the number of handsets.
However, from the 3rd quarter of 2006 (July-September) to the 4th quarter of 2006 (October-December) there was a tiny 1.7% increase in sales. Sign of things to come or just a little blip in sales due to Christmas?
Here we can see that Nokia shed almost 800 jobs, or 12% or its North American workforce over the course of a year. Nokia is beginning to scale back. Wouldn’t you if your sales numbers were going thru the floor?
Ricky has the most extreme conclusion, that Nokia should just give up:
Nokia, you might as well simply pull out of the US market entirely. Don’t even bother sending crap to the FCC. I’m dead serious. This is getting ridiculous. First off, let it be known that I am a Nokia fanboy. If you’ve crossed me on Howardforums, you’ll know this, and you know that I’m not afraid to admit it. I started with the 5190, moved to the 8260, then to the 7160, up to the 3360, on to the 6340i. Heading into GSM I had the 3595, 6620, 3300, 6170, 6230, N-gage QD, 6682, N80, N73, 6102, 6102i, and E62 (in no particular order). I’ve never owned a cellphone for longer than a year, and I’ve converted as many people as I can into Nokia users.
HOWEVER, I’m completely embarassed at Nokia’s "presence" in the US Market. I put that in quotation marks because I don’t think you can call it a presence. They currently have 3 phones that they themselves produce and market. The 6030, an entry-level phone that’s 2 months away from EOL, the 6102(i)(3), a low-level flip that’s also close to EOL (and quite possibly the worst Nokia I’ve ever touched) and the 6133, a mid-level flip that was announced nearly a year ago.
Read the whole thing. You can feel the angst coming off your screen.
His argument is from the "so few models are sold in the USA" angle that is common among Howard Forums members. The problem in this situation is the operators. If you’ve ever used a locked phone in America then you understand that the level of castration a device endures in order for an operator to hit their bottom line is quite appalling. Nokia wants to sell its phones to Americans, there is no question about that. Operators are the middle man impeding sales.
Next up is Olly, a part time blogger, further adds to Ricky’s post:
1.) Despite your dispute with Qualcomm (NSDQ: QCOM), and the fact that two of the major U.S. operators are in bed with them, there is still a good market for GSM devices here.
2.) Like it or not, the Carriers are _the_ distribution channel here… i know you know this, so dish them something more profound then the Nokia 3100 perhaps?
Finally, you need to realize that you are _handing_ the U.S. Market to Microsoft. For every LACK of U.S. variant of W-CDMA you fail on for Cingular (and I’m sure for T-Mobile) there is a WM5 (and now wm6) HSDPA device announced.
I _hate_ Windows Mobile, and I _love_ my Symbian/S60/Nokia devices… but you are lagging severely behind here, and I can’t afford to move to Europe. The infrastructure is here, so it’s time you took advantage of it.
This is the "Windows Mobile is stealing your market share!" claim that gets tossed around quite often.
The latest Canalys market research report has this little snippet:
In operating system terms, for the full year, Canalys estimates that Symbian had 67% share, up from 63% in 2005, Microsoft was in second with a slightly reduced 14% share, RIM came in third on 7% followed by Linux on 6% and ACCESS/PalmSource with the Garnet OS on 5%.
So Olly the reverse is happening. Symbian (foundation of S60, UIQ and NTT DoCoMo (NYSE: DCM)) is gaining market share while Windows Mobile is loosing it.
I know what you’re going to say … this conversation is about the USA. Let us refer to the first chart I posted labeled "Nokia Mobile Device Volume By Geographic Area." Nokia sold 105.5 million mobile phones in the 4th quarter of 2006. Of those only 5.9 million were sold in the North American continent. That means around 5.6% of the mobile phones Nokia sold made it to the USA and Canada. That’s a pretty tiny figure.
If you were the CEO, which market would you focus on? Europe and Asia account for 54% of the phones Nokia sold last quarter. Two continents are responsible for over half of the phones Nokia makes.
Simple economics really.
Darla Mack believes that Nokia thinks Americans can’t handle smart phones:
I refuse to believe that its the consumer market that have been brainwashed into thinking that the Motorola (NYSE: MOT) RAZR is the %@#%! Cingular store reps tend to push whats hot (commission wise) and I’m not saying all areas. But I’ve been doing secret shopping in my area and thats what I’ve noticed.
Last year Cingular changed their contract options from 1 year to 2. If we must lock ourselves into a 2 year contract then we need more device options. More options that we as consumers know about!! I hate to say this, but myself as well as other "editors" here in the US would love to get some feedback from Olli-Pekka Kallasvuo on this issue, just so that we can get an understanding.
Sure, its easy to say, just use the device that you are using and forget the providers… but thats not the right answer. There MUST be a solution of some kind. And dare I mention the warranty issue again, which does play an important factor.
What I have to say to Darla I’ve said to Ricky: Operators have the keys in their pocket and Nokia isn’t making any progress kissing their feet and respecting their wishes.
You’re also giving the standard American consumer too much credit. Walk in to any mall, Starbucks, or dare I say it … McDonald’s, and you’ll see that the RAZR is the phone to own right now … for the 4th year in a row. The American people have been brainwashed to believe this. The American people need phones that do what phones do best: make calls and send text messages.
I apologize for any broad stereotypes I’m about to make here, but from what I’ve observed at my University the only people who own smart phones are the Asian and Middle Eastern students. Most (75%) have Sony Ericsson (NYSE: SNE)’s due to their MP3 playing capability, and the rest have Nokia’s.
More than half of the Caucasians in my classes either have a RAZR or SLVR. The other portion uses Samsung. My friends are pretty much an even split between Samsung and Sony Ericsson’s with the exception of two girls: one has a RAZR in black, the other has one in pink. Greg has a Treo 700p.
While you give American’s credit, I don’t. They still think RAZR’s are cool, and don’t mind signing their soul away for 2 years at a time to have a phone that came out such a long time ago. RAZR’s are practically free now with contracts.
Jonathan Greene, video review extraordinaire, wonders why Nokia hasn’t made any phones that support the USA 850 MHz WCDMA frequency:
I’ve been enjoying reading the reports from 3GSM and there are some really nice things coming from the Fins, yet again — not a single device will work on the 3G capable US network. Where’s the love Nokia?
Simple. There is only one company right now who makes a triband 3G chip: Qualcomm. Nokia is to Qualcomm what Shiite’s are to Sunni’s right about now. The legal dispute is going to be down right dirty. Is it hurting Nokia’s product offering? Absolutely! I for one am disappointed that 3G in the E90 doesn’t work around the world. Not to mention the 3G in my Nokia E61 and N93 are useless where I live.
Tommi finally wraps things up by being confused:
Frankly, I think the situation sucks. Nokia wants to sell devices in the US, and people in the US want to buy our devices – but the seller and the buyer don’t meet. But why? Honestly, I don’t understand why. Of course, I have heard all kinds of reasons, but still, my mind refuses to understand it.
I have a possible solution:
Online shopping.
Forget the operators. Forget the flagship stores, which while nice … there are only 2 in the entire USA. $5 says Ricky is going to comment about the Nokia Experiance Stores. Personally I’ve only stepped inside one, in Las Vegas. They didn’t have the latest phones, and worst of all I couldn’t buy anything. People like to play, and if they like something, then they like to buy. Is it difficult to keep just a little back stock?
Anyways, back to my solution of Nokia launching an online store:
- Maintaining a warehouse is easier than maintaining a brick and mortar store.
- You can offer all your latest phones and best of all service them in case something happens.
- No more negotiating with the operators, you’re selling directly to the consumers.
- You can begin an ad campaign informing people about your product, why unlocked is the way to go, and telling them to go to nokia.com
- "We don’t sell minutes, we sell the most advanced cell phones on the planet" is quite a catchy phrase don’t you think? What happens if you start this and succeed? More mobile phone makers will begin selling unlocked devices to consumers directly and a chain reaction will occur. What happens if you fail? Just ship over the unsold stock to Europe and Asia.
- Advertising that centers around labeling operators as the middle man. Let people know that they can buy phones from the people who make them. We don’t buy our cars from Exxon, why should we buy our phones from operators?
- Offer to buy out peoples contracts. It may cost you in the beginning, but with more people totting Nokia’s then the more people will start noticing your brand. Every time I whip out the N93 practically all eyes are on me.
- Inform people that they don’t have to change their number, or their service, they merely have to swap that little piece of plastic that came with their phone.
- Start giving out phones to University students. The epitome of a low self esteem enviroment where any material product will raise your popularity a few notches. Give a few college atheletes or frat presidents a few of your latest N series devices and watch people start asking "wtf is that thing? I want it!" If this plan fails then at least we’ll have some pretty … interesting videos show up on youtube
- Sponsor American Idol.
What do you guys think? Is this too bold of a step? I think the industry needs that swift kick in the ass I’ve been asking for since December of last year.
Good post!! Because I’m not an expert in this area, I won’t comment about the feasibility of your ideas. Anyway, I like the fact that you keep pitching ideas
You can buy many of the high end Nokia phones in an unlocked state from the http://www.nokiausa.com store right now. Were you thinking of some other kind of online store?
I think the general American consumer just wants something cheap that makes calls and enthusiasts like us just have to keep educating them as to how powerful these Nokia devices are and what they can do to improve their lives. I don’t think many Americans are yet ready to shell out US$500 for a phone when they can get one for free or US$50 and it will take a change in culture to convince people to pay for their devices.
The current Nokia USA store doesn’t sell many Nokia models.
The most popular S60 device, the N73, isn’t even on there.
“You can buy many of the high end Nokia phones”
Hardly.
Stefan –
I think you missed the point of my rant over on Ricky’s site by simply quoting #’s. It’s not about _marketshare_ it’s about _mindshare_, and in the end, the latter leads to the former.
When you say ‘Personal Computer’ what is the company most often associated with that phrase? Microsoft. When you say mobile phones, Nokia is in the same position — but it’s not a position they can maintain if they don’t actively try. For the past few years, mobile data in the U.S. has been limited to a small segment of people (namely the geeks like me on Howard Forums) that cared about it. We knew what GPRS, EDGE, UMTS, etc were well before the general public was aware that they even had access to those things.
With the advent of certain services, things like VCAST from Verizon, all of a sudden the paradigm has started to shift — no longer is the U.S. consumer limited to the bumbling idiot who just wants to make a call and leave it at that. Everyone points to the RAZR as if it were the _sole_ indicator of the U.S. consumers view of mobile phones — but despite it’s sales prowess, it’s reached an E.O.L. in being able to stand on it’s (questionable) fashion-status. The new RAZR’s are addressing this by keeping the same fashion-styling, but adding in things like downloadable music services, high speed access, mp3 players, etc.
So what does all this mean for Nokia (and Windows Mobile)? Simple. As the paradigm has shifted in the U.S. towards a public being more aware of mobile data, and demanding more and more from it’s services, Nokia has both a _mindshare_ and _marketshare_ responsibility to keep up. You are right, insofar as you say that the carriers are where people get their phones from in the U.S. But that just goes to show you whats happening: how many Symbian devices are being carried by U.S. carriers at this very moment? Exactly one, the e62, and it’s being E.O.L.’d by Cingular/ATT already by all indications. How many Windows Mobile devices are being carried? Well, lets look at some numbers that you neglected in your post:
# of Symbian Devices sold through a carrier in the U.S.: 1
# of Symbian Devices with High Speed Data sold in the U.S.: 0
# of Windows Mobile Devices sold through carriers in the U.S.: 10
# of Windows Mobile Devices with High Speed Data sold in the U.S.: 8
Who makes the most Symbian devices? Nokia. How many Symbian devices with high speed data have they offered to U.S. carriers that HAVEN’T been picked up? One, that we know about, the N80.
Now, if Nokia was offering up a U.S. version of _every one_ of it’s smartphones to Cingular or T-Mobile (who, granted, hasn’t deployed UMTS yet), and the U.S. operators were turning them down then yes, it would be squarely on the operators shoulders. But Nokia SIMPLY ISN’T TRYING!
As for your “U.S. consumers are too stupid” schtick, save it. If that was the case, would Windows Mobile devices have as much success on the two largest U.S. carriers as they currently do? Would the Treo have been the “it” device to have in the business world? Would Blackberry be a household name?
Plain and simple, there IS a demand for smarter devices among U.S. consumers, and the fact that Windows Mobile, RIM, and Palm have done so well proves it. It started with business users, and has gradually trickled down to the average Joe consumer as well. People made the same arguments about camera phones a few years ago, when they were available in Asia and Europe, but not the U.S. “U.S. consumers don’t care about having a camera on their phone, they just want them to make calls”. That kind of sentiment shows a true lack of forward thinking on the part of those making the argument.
Now, as for your online store, I’m all for it. I wish every single Nokia device would be available online, period. But without Nokia taking an active interest in the 3G technology here in the states (as fragmented and screwed up as that technology may be), it won’t matter.
You can blame the carriers all you want, but the fact is that Nokia continues to take an active disinterest in the U.S. Smartphone market, at least compared to any other market out there.
Mobile data is a reality, even for the ‘lowly’ U.S. consumer. And Nokia is missing the boat — standing on the dock while HTC and others stand at the stern going “nah-nah” as the ship pulls away.
Ideally, I’d love a market where the phone was seperated from the carrier. But prior to that happening, I’d love a market where my favorite manufacturer actually cared about _me_ as a consumer.
(and this is coming from someone who refuses to use a cell if it’s not a Nokia).
-olly
I wasn’t going to comment (and I’m not giving you $5) but I will:
First off, Nokia already has an online store, they just don’t have anything to put in it. That’s my point that I think you missed. They don’t have any devices to try to convince carriers OR consumers to buy.
To your points:
1. True
2. True, assuming they have at least GSM 850
3. Good idea, but sadly, the way to consumers, in America, is still through the carriers, so you have to give them SOMETHING*
4. Agreed – consumer education is BADLY needed
5. Not a good idea. You have to maintain a relationship with the carriers. Also, it’s important to cater to the WHOLE market, which means low-end and mid-level is important, which means you don’t want to promote “advanced”. Focus on a something like quality, something that’s universal to all types of consumers
6. again, in the US market, still, sadly, carriers are a big part, you can’t throw them under the bus
7. What use is this? Simply educate the consumer on swapping SIMs and how easy that is. I’m under contract on my N73, who cares
8. There you go
9. You go to a wierd university, if material things affect “popularity.” If that’s the goal, go to high schools, that’s where the popularity contests are. I don’t think this idea has any merit at all, honestly.
10. Why?
These are my points (and I apologize if they weren’t clear enough in my post)
1. You have to create devices for the US market if you want to be here. that includes 3G. Every other manufacturer can do it, surely you can, too.
2. You have to make those devices available. If it’s through the carrier or unlocked, you have to have a brick-and-mortar place people can walk in, play with it, and walk out with it. Why do you think electronics stores have all their TV’s on, computers booted up, and video game consoles demoed? You can’t advertise something and then not make it readily available to purchase NOW.
Your figures for market share are skewed because Canliss does not count many of the windows mobile pocket pc phone devices, considering them PDA’s rather than smartphones. If these devices were included then the windows mobile market share would rise significantly.
Olly: Americans are too stupid. Look at the facts:
“North America remained the only region where PDAs continue to outsell smartphones. In the first half of 2006, the region accounted for 45 percent of worldwide PDA shipments, slightly up from the same period in 2005. In the first half of 2006, the EMEA and the North America regions accounted for 85 percent of the PDA market.” – Gartner Research October 2006
Source: http://www.gartner.com/it/page.jsp?id=496997
They’re still buying PDA’s!!
Treo’s, BlackBerry’s, and Windows Mobile devices are a small, very small, portion of the devices being sold today.
Besides if Americans were so smart then they would’ve figured out by now that they can buy phones from people other than their operators. They don’t, and because of that the people who have control of which handsets sell and which handsets don’t are to blame for Nokia’s current position.
I would hardly say Nokia is “missing the boat” here in the states.
First of all there is no boat, right now it’s more like a raft with one paddle. As the market expands and becomes more lucrative I totally see Nokia jumping in, but right now there is no financial incentive. China and India are experiencing double digit growth year after year, and Nokia is working their ass off trying to capture those markets. I’m glad they’re pouring all their resources in to places that actually count towards their bottom line. The more money they make the more money they can spend on research. The more money then spend on research the devices they release will be that much cooler.
Ricky: Yes I know, UNT isn’t the finest facility in the land, but hey it’s local and pretty cheap. They have free education in Finland … too bad I don’t speak Finnish.
I agree with you 110% that more Nokia’s have to make it in to B&M stores. Best Buy would be the best solution, however confusion is going to arise.
“What makes this phone $400? Do I have to change my phone number? How many minutes a month does it comes with?”
Someone needs to educate the US consumer market. The operators sure as hell aren’t. That is Nokia’s, Sony’s, Samsung’s, and LG’s job and I admit that is one area where a lot of improvement could be made.
Alfredo: Any proof to these allegations? They are a recognized group of experts.
Here’s my take on the situation as a 16 year EPOC/Symbian user and one experienced with a Cingular Locked S60 phone.
Let’s start with the E62 I used for 6 months.
First, with the exception of ProfiMail not working (now fixed in latest version)the phone was pretty standard S60 3rd. Everything else worked just like an S60 phone should. Nothing was crippled – OK so there was no WiFi, but all the S60 stuff worked fine. That the Nokia email program is TOTAL CRAP and doesn’t handle HTML mail sure isn’t Cingular’s fault. My brother loaded up ProfiMail yesterday – I gave the phone to him – and he is in love with the thing: totally changes the paradigm of the phone. Now, that said, S60 on the E62 is the same old SSSLLLLOOOOWWWW P.O.S. that it is in every phone. I thought it was Cingular hacks messing with the OS, but as I surfed various forums (fora?) I read posts from all over the world on how ridiculously long it takes for a folder or contact to open once selected…again NOKIA’s fault…Put in some GOD DAMNED memory. I am no M$ fan but Billy G said “sand is cheaper than code.” A little more silicon (more memory, faster chipset a la E90) would make S60 far better (and, yes, it is ALREADY better than WM5 and WM5 PPC). I have reverted to my P910a as it is very fast (very fast) and stable.
Second – and the real issue – the radio chipset.
I believe that NOK and Qualcomm are locked into a legal battle over use of the triband 3G chip. I imagine that SE are involved as well. Until the Symbian-licensing manufacturers can provide the USA with 3G phones that work here they SHOULD STAY AWAY (you can have no idea how much I want to try a P990 and E90). But Symbian would never be able to rise above the damage they would do to themselves as not advanced enough for 3G in this US market of unwashed, nubile smartphone users.
Better to wait until you have the goods than to launch with inferior product. General Motors have consistently launched cars lacking the goods of their competition over the last 20 years. Look where the strategy has got them. As far as MOT phones. They all look the same – save the new UIQ (that’s Symbian, folks) one. Nobody buys them because they all look like the RAZR and MOT has announced some significant layoffs.
Finally, buying an E90 or N95 (or P990 which you can at SE.com) that doesn’t fully work here in the USA is like buying a blow-up doll of Angelina Jolie: not, I expect, the full experience.
We just have to wait, and perhaps look at an impediment to trade lawsuit vs. Quallcom
From a business perspective, Nokia is getting locked out of the market by carriers in the US. The carriers own the customer (contracts) and set up some very attractive financing options for phones. Now, customers hold far more sway than everyone gives them credit for. Nokia’s problem is that **they aren’t number one** in any particular field. Customers just don’t demand their phones.
Business phones: RIM kicks their rear. RIM understood that the server software was as important as the phone for email connectivity. RIM beat nokia to the punch and is the defacto business phone.
Consumer phones: Sorry, but the RAZR looks pretty darn cool. They don’t “do” much more than make and receive calls, but they are small. SMALL, get it? For most consumers, SMALL is king. Where is Nokia’s micro-mobile?
Music phones: I thought that Apple would take over this space with the iPhone, but I’m not sure anymore. They need to open up to more carriers. But this category, like the business category, is dependent upon the server software (iTunes store) and business relationships (recording industry). Unless Nokia makes a deal with Apple (good luck) or the recording industry they aren’t going to take over this space either.
PDA phones: Perhaps this would be called the “smartphone” category by others. IMHO, Nokia is still not fully able to synch with outlook. Windows mobile will likely take over this space.
Now, IMHO, not being number one in a particular field isn’t as bad as it sounds – IF Nokia understood convergence. I’m not only a business user. I’m not only someone who listens to music. I’m all of them. Stop intentionally crippling phones by not including software that similar phones have. I know they are attempting to segment the market, but it’s just not working for them. Would you buy a laptop that only played music? That only allowed email? A computer that looked cool but had limited functionality? Further, would it be worth making an investment in music distribution if only a portion of their phones support receiving it?
Nokia would benefit from offering fewer phone models with a standard software platform and selling additional software packages. That way, Nokia and the carriers could get out from under the constant hardware churn, offer new features through software and make higher margins from software sales. It works for Apple.
Ok, my rant is over. For now.
Great post, not going to do any pontificating here, just going to say that a lot of things are changing in this market and I expect that Nokia will begin making some giant leaps forward in North America in the next 12 to 18 months.
oops, I double posted somehow. Please remove second post.
Bottom line: Americans buy mobile phones via operators. Europeans buy mobiles straight from shop and they are willing to pay full price and choose/switch operators based on their actual needs. Therefore mobile market in the U.S. is very much influenced by operators. It’s as easy as that.
I’m down with what geek said. To go further, we are talking smartphones and it would be great -IMHO – if Noia or SE would let us pick the form factor we want and stock it with the apps we want giving us – say – 10 apps for free. I mean, compared to what the PIM could do in EPOC Release 5 (the Symbian progenator) ten years ago, versus what the PIM in Symbian 9.1 can’t do, anyone who uses the inbuilt PIM functions is missing out on is possible on Symbian (try Aqua Calendar). I mean, the S60 in-built apps suck! Slowly! Give me a form factor (candy-bar, clam, flip, palmtop) and UI choice (S60 or UIQ) and I’ll customise the damn thing anyway!
The problem, IMO, isn’t distribution, arguing over carrier vs. retail (though I have strong feelings on that). The PROBLEM is the lack of handsets, PERIOD.
Out of the last 12 phones announced by Nokia, S60 OR S40, how many were for the US market? How many were for the European market, but just tossed in with GSM 850 so they could pilfer into the US market?
More importantly, how many had US 3G? THAT”S MY POINT. The first two, 6282 and N80, only had one band. While the other manufacturers (LG, Samsung, Motorola, etc.) obviously got the memo about needing BOTH 3G bands, Nokia missed it. And now they don’t have anything.
I hope Paul’s right. I hope all this facetime about Nokia re-focusing on the US market isn’t just hot air.
The Symbian OS is superior, numbers prove that. (of if not “superior,” at least preferred.) Nokia is still making phones, and selling the piss out of them. Again, numbers show that. Numbers also show that they’re not using a chip that the rest of the world manufacturers are. Numbers also show that the rest of the industry feels it’s a fair price for the chip (or is getting a good enough deal on it).
Stefan,
I just want to clarify something here a bit. First of all, thanks for posting our thoughts and views and keeping the topic running.
Having been to the Nokia Flagship store I can say that the N73, N80, N93 and N91 are present and even being used by the salespeople there. Yes, if available and in stock, they can be purchased unlocked for use with any GSM carrier… which is a good thing. But I think what the confusion is and even I myself am included in the lack of understanding of the goings on, is that the providers have way too much control over what we as consumers chose to use. When I was in NY they had launched the free wifi service throughout NYC… but provider-wise, there were no Nokia devices available in order to take advantage. What I meant by “Americans not being smart enough for smartphones” wasn’t meant as an insult. The fact is, and I’ve noticed this since I have started blogging, is that we in fact ARE smart enough. Compared to lets say 5 years ago (and even that may be too far) we have evolved. Thanks to us “Editors” (I’m not going to use the word Blogger anymore) here in the US and forums, consumers know have the knowledge at their fingertips. To be quite honest, I think its the providers that aren’t smart enough. What I’ve experienced from “secret shopping” is that sales reps recite what they’ve learned from spec sheets to un-knowing consumers.
I do share your opinion on the RAZR craze though. Heck even watching TV shows all you see is someone with a RAZR. Lol, I’m sorry but the RAZR is not my cup of joe and I do hope that an N76 variant will see its way to the US to kick is arse!!!
Now that I have a better understanding, thanks to comments on my blog made by “anonymous” I’m even more angered at the providers… Cingular being at the top of the list.
I just don’t think that they need to have that much control… especially when it comes to our wallets!
I’ll throw in a few words to keep this debate going.
Based on Nokia’s previous experiences with trying to release handsets for Cingular, I wouldn’t want to focus my company’s attention on them either. They started with the 6682, which had some of the worst Cingular branded firmware s60 has ever seen. Then came the idea for the N80, but Cingular didn’t let it happen. Next was the idea of the N75, which seems only to be delayed by Cingular, not Nokia. The latest installment, the E62, has been as my man, Ricky said, “an embarassment”. Cingular took the features that made the E61 great and removed them just to protect their data profits. So far that’s 0/4 in Nokia’s book. How many times is it going to take before Nokia stops trying altogether?
Apparently, not too many, since they’ve partnered with T-Mobile for US 3G. While we may not have seen any US 3G phones at 3GSM, we just might see something for T-Mobile’s bands in the near future as T-Mobile begins their roll out. I’m beginning to think this may be the last hope for Nokia in the US. http://www.infoworld.com/article/06/11/27/HNtmobile3g_1.html
Nokia’s battle with Qualcomm is just another piece to the puzzle. Nokia can’t build handsets with triband UMTS chips due to Qualcomm. So what are the options? A) Build a phone with UMTS 2100, or B) build a phone with UMTS 850/1900. The problem is a phone with UMTS 850/1900 is treading right over Cingular’s territory, and releasing an unlocked device with these bands would give Nokia a brand new lawsuit to deal with, delaying the process even further. Triband UMTS is ambiguous for unlocked phones because it’s not specific to any region or market, but 850/1900 is not only specific to the US, but directly to Cingular as well. What other options does Nokia have?
I’m disappointed too, since I’d love to play with faster data speeds, but I think all we can do now is wait (and switch to T-Mobile if you haven’t already).
Richard,
Exactly. Plus, I’d gladly pay for phone updates if they fixed issues or added new features. I’d imagine Nokia would actually fix their firmwares (gasp!) if Nokia charged for the update. It’s far better than being told to go buy the new phone.
Very good post. I don’t think you can educate US market, but I think nokia has to bring variety and bring the latest phones TO THE CARRIERS if they want US market. Don’t bring crappy phones that were released 1yr or even more ago. Choice is very important and Nokia just has to show US market that they have the best variety of phones in the world and people will believe. JUST SHOW WHAT YOU’VE GOT!
Good post, but… wow… even Better Comments…
I’m not an American, but lately, I read so many rants about this exact issue.
“I don’t think many Americans are yet ready to shell out US$500 for a phone when they can get one for free or US$50 and it will take a change in culture to convince people to pay for their devices.”
Yea. I think it’s what the people are already accustomed to. Free phones from carrier. I totally agree with your old post, http://www.ringnokia.com/2006/12/the_american_ce.html. I find it ridiculous how the US (OK, Japan maybe similar) is totally different from the rest of the world by offering phones for free through contracts instead of letting customers buy phones themselves. This is probably why Nokia doesn’t want to bother selling its phones in the US… -_-” I don’t see them getting much from advertising their phones when it’s up to the carriers to support it or not.
geek, I kinda like your comment. Yeah, Nokia has to realize they have to stick to something if they want to win in the US market and intentionally crippling devices to segment the markets is pure BS!!! Why don’t I get the S60 software in other S60 devices? Why don’t other S60 devices have the software I have? Why don’t all S60 devices all have the same set of software when the hardware allows it to work? -.-” Nokia should stop this and make all of their phones have basic functionality for all purposes. Oriented at something, sure, but not disabled at everything else.
Overall, I think the whole market has to change and actually let Nokia, SE, etc. sell their own phones. If this doesn’t work this way, Nokia has to adapt to the situation. Educating people how good an S60 phone is won’t help when they won’t consider buying themselves a phone whe they used to get phones for free.
I’m kinda shocked nobody has mentioned this, so here goes…
Americans may not have wanted smartphones in the past (aside from business users), but the carriers are now pitching them at regular consumers fast and furious.
Look at the commercial for the Cingular BlackJack, it’s the latest example. And it’s an area where Nokia f’ed up bigtime. Had the N73 been available in the US, with proper 3G connectivity, Cingular could have built a campaign around that. Of course, this assumes that Nokia would have ponied up some of the advertising costs which I’m sure Samsung did, but hey… gotta pay to play.
The E50 was a device that could have been sold here. EDGE, quadband.. it was a perfect placeholder S60 device that could have been sold on the cheap. But yet… nothing.
Bottom line is, Nokia has blown the US market. Not ‘is blowing’, not ‘is about to lose out on’, but they’ve blown it. Time to take your toys and go home Nokia… I’ll always remember my S60 phones fondly tho.
Nah!
We’ve all missed the boat here.
We’re not smarter than NOK and they’re not dumb.
Qualcomm is suing them and attempting to limit their importation of GSM phones into the USA. I am sure that once the lawsuit is cleared up we’ll see a flood of our favourite NOK (and hopefully SE) models supporting the Cingular – um, – AT&T bandwidths for 3G.
Nah!
We’ve all missed the boat here.
We’re not smarter than NOK and they’re not dumb.
Qualcomm is suing them and attempting to limit their importation of GSM phones into the USA. I am sure that once the lawsuit is cleared up we’ll see a flood of our favourite NOK (and hopefully SE) models supporting the Cingular – um, – AT&T bandwidths for 3G.
In response to your question about my comment, if you look at the report from Canalys, you can see that they actually have 2 categories, smart mobile devices, and smartphones. The report states that:
“Total smart mobile device shipments for 2006 were 77 million, of which 64 million were smart phones”
Later it specifically refers to the smart phone segment when discussing market share, it leaves out the roughly 13 million devices which qualify as smart mobile devices but not smart phones.
I don’t have their exact definitions, but I have seen research in the past where definitions were posted and were almost completely arbitrary, with phones like the Treo line and blackberries placed into two different categories.
Whether this has happened here or not I don’t know, but I’m not inclined to trust these numbers too far without knowing exactly what those definitions are.
Richard,
I agree that individually, most (all?) of Nokia’s people are intelligent. However, collectively, for whatever reason, they are getting their collective rear kicked in the US. I don’t consider their current performance high in effectiveness, regardless of the reason (Qualcomm lawsuit, mediocre phones, etc). IMHO, for Nokia to succeed in the US, they are going to have to change something.
With technology advances (VOIP, wifi availability, convergence) and current market pressures, something is going to change. The field is positively ripe for disruptive change. Whether it comes from a scrappy VOIP startup, linux open source phone providers, Apple, Nokia, or the network operators is still to be seen. Based on recent history, I can say that both Nokia and the network operators (T-Mobile has potential) and pretty low on my list of companies to succeed when it happens.
The real rub is this: The winner will not succeed because of incremental technology change. They will win because of a new, innovative business model. The equipment used is just a distraction. Kudos for Stephan for going beyond the “phone of the day” photos and getting to the real story behind the story.
http://en.wikipedia.org/wiki/Disruptive_technology
Bottom line is that if Nokia offered a E90 with tri band HSDPA, we would buy it from any source in the world. Who cares if a US operator offers it?
The problem is that Nokia doesn’t even make tri band HSDPA an option because of their pissin’ match with Qualcomm. So as long as they feud with Qualcomm, they will ignore the US market for 3G. If they ever make up, you will see tons of Nokia tri band 3G phones show up within months. Period.