Can Nokia compete in high-end smartphone market?

superphones, smartphones, Symbian, MeeGo- Nokia Logo
superphones, smartphones, Symbian, MeeGo- Nokia Logo

Nokia’s head of sales and marketing, Niklas Savander, went to Twitter today to answer questions about the future of the world’s largest handset maker. While we love Twitter and all (follow us @intomobile), discussing the company’s high-end handset plans took a little more bandwidth than 140 characters, so I got on the horn with Savander.

The company is still the largest phone maker in the world and it has the largest share of smartphone users globally but it’s clear that it doesn’t have the momentum of an Apple iPhone, Google Android or even HTC. It’s last flagship device, the N97, sold reasonably well but did little to win over the early adopters or tech press.

“Not being successful in the high-end [market] is not an option,” Savander said.

He said the company is well aware that these top-shelf devices are indicators for what will be common on all mobiles in the future. Today’s smartphone is tomorrow’s feature phone. These premium devices also generally carry the highest amount of profit, as Apple can attest.

I think Nokia generally has the hardware side of things down, as the E Series devices have fantastic keyboards and the upcoming Nokia N8 is packed to the gills with features and, more importantly, shows that the company has learned to implement touch controls in a natural way. We’ve played with this device and it’s pretty darn good.

But it’s becoming more difficult to stand out from the crowd with hardware, as most top-tier smartphones now rock a 1 GHz processor, a high-resolution screen of at least 3.5 inches, a 5-megapixel camera or above and WiFi, GPS, Bluetooth, etc. The software and apps are increasingly becoming the key differentiators and this is where Nokia’s strategy concerns me.

Savander said Nokia will look towards MeeGo as its high-end solution and for Symbian to be a platform for high-end and middle-range smartphones. It’s too early to tell how MeeGo competes against iOS, Android and BlackBerry 6 but we have already seen some Symbian^3 and it’s not too promising.

In our view, the user interface appears dated and the early previews we’ve seen of Symbian^4 don’t appear to improve that too much. Don’t give me any guff about just wanting something “pretty” – compelling user interfaces have a direct correlation with how easy it is to use the device. Also, the competition is so fierce in the high-end smartphone space that functionality alone is not enough – you have to make things look good, too.

To be fair, Savander said the Symbian platform is one of the best for enabling carriers to tailor it to do things like add their own services and that’s important for striking deals. Nokia is also pushing Qt as a development platform that will work between MeeGo and Symbian. Ideally, this will also make it simple for other platform developers to port over apps.

I suggested there may be an inspiration app gap with Symbian, particularly with U.S. developers and Nokia’s Savander basically told me to get that weak stuff out of his house. He said many devs look at Nokia because of its large global presence and footprint. He admits Nokia needs to do more to have a presence in the United States, but he is happy with the relationships between developers and Nokia.

I spend a lot of time talking to app developers and the game plan is generally iPhone first, Android second, then BlackBerry. After that, you evaluate Windows Phone 7, webOS and Symbian. This isn’t just isolated incidents, as this happens all the time.

The big boys (Facebook, ESPN, Google, etc.) will be on every single app platform there is but it can very well be those small, innovative companies that start to tinker around on your platform that wind up having a major impact. We have yet to see the fruits of Apple’s Siri iPhone app maker purchase, but this may very well give future iPhones a huge voice-control advantage over the competition. This was made possible by having an extremely compelling app platform.

Another issue with Nokia is that it has a relatively small presence in the high-end U.S. market. Sure, there’s the E71x and the Nuron on T-Mobile but there’s nothing jaw-dropping yet.

Savander said Nokia has been working hard to solve this issue, including making high-profile partnerships with American tech companies like Yahoo, Microsoft, Intel and Qualcomm. It has also worked out carrier-billing deals for the Ovi Store with AT&T and T-Mobile. Savander said none of these are gigantic steps, but when you put them together with some of the company’s other efforts, Nokia is on the right path.

“Nothing big ever started big,” Savader said.

What about the Apple iPhone, though? The original unsubsidized device didn’t do the box office numbers that subsequent $200 iPhones did, but it did have a big impact on the rest of the industry when it dropped. No one’s expecting an iPhone from Nokia, but multiple devices of that caliber is what it’s going to take to be the leader in the high-end smartphone market. Can Nokia do it?

As for the rumors that Nokia CEO Olli-Pekka Kallasvuo is on his way out, Savander had no comment.

Check out the video below for a quick wrap-up of the Twitter conversation.

  • Kylie

    MeeGo will gain traction.

    Keeping MeeGo as open as possible is Nokia's best bet, which is what it is doing so far, in that MeeGo is open-source. Android is dominating fast, but there's a need for a non-Google open-source smartphone platform. MeeGo has big backers in Nokia and Intel, and it is already gaining traction in larger portable devices.

    I believe iPhone will be the only successful proprietary phone platform in the long term. The rest will be open-source platforms with big corporate backers.

    Nokia is actually moving in the right direction. It's just not getting there fast enough. But it won't be long until MeeGo appears on smartphones.

  • Ving

    Interesting article. In my opinion, I think Nokia won't be able to compete in the smart phone market, the reason being they release models too late. The Nokia E71 and E72 were really good phones but lacked the high end features that other smart phones have. The Nokia N97, I believe sold pretty well but was let down by the software.

    I haven't owned a Nokia since the Nokia 3210 and that was over a decade ago :O

  • @shahryar

    I had read this article a few days ago after @janole tweeted it. It had a hand in a recent write up I did here:

    Would love to hear thoughts from you Marin and anyone else who cares about Nokia

  • @shahryar

    I had read this article a few days ago after @janole tweeted it. It had a hand in a recent write up I did here:

  • @kenosando

    I am wondering if you have had hands-on interaction with Symbian^3 of just go by the looks and say it is not up to snuff with iOS, Android, and BB 6. You correlate looks to functionality but if you remember, the E71/E71 (which you also bash) are built on Symbian, released around the 2nd/3rd generation iPhones, and are still more functional (granted the jailbroken iPhone is the only way to get more functionality). Nokia is competing in the high-end smartphone market, and Symbian is the world's most popular OS for smart-phones — so the tone of this article is undermining the fact Nokia is number 1 in the world.

    • willpark

      Actually, both Marin and I have had extensive hands-on time with Symbian^3 as it stands today, courtesy Nokia. Just thought I'd chime in on Marin's behalf.

Back to top ▴