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Nokia Chairman defends Stephen Elop and Nokia’s decision to sell hardware division to Microsoft

Stephen Elop

It’s been nearly three months since Microsoft announced plans to acquire Nokia’s handset division. The deal has a few final steps to go through being finalized. One of those steps recently happened. Last Tuesday, Nokia shareholders finalized the 7.2 billion dollar transfer of Nokia’s phone division to Microsoft. That meeting wasn’t without its fair share of critics, most aimed at Stephen Elop. However, Nokia Chariman and interim CEO, Risto Siilasmaa, defended Stephen Elop and the sale of Nokia’s handset division.

During the 4 1/2 hour shareholder meeting last week, most of the criticism was focused directly at Stephen Elop. One shareholder claimed Nokia was a “triple-A plot” that “drove the company to ruin”. Siilasmaa defended Elop by telling shareholders he had never met anyone who worked as hard as Elop.

Siilasmaa also had to defend the sale of the handset division. Speaking on that he said:

“On the board of directors, we understood that, as the decision-makers, we would also be heavily criticised. However, we are convinced that continuing with the old strategy would have most likely led to great difficulties for Nokia, its shareholders and employees.”

Losing the handset division of Nokia to Microsoft is going to be a hard thing for many Finns to swallow. Siilasmaa himself acknowledged the fact by saying he was aware that the sale “would raise deep feelings” among the Finns. It’s also easy for them to blame Elop, who many consider to be a Trojan horse for Microsoft. However, it’s nice to see current CEO Siilasmaa defend the actions of both Elop and the board.

Source: South China Morning Post

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Nokia Chairman defends Stephen Elop and Nokia’s decision to sell hardware division to Microsoft

137 Comments

I've been in 3 companies at take over. Everytime, there was pain, emotion and hating on the new "Mothership".

Sometimes it was well founded, sometimes it was just hating on the new people. Humans don't handle change well. And the Finns see Nokia as "theirs", being handed over to sme "another country" just won't sit well with them, even if Microsoft made the acquisition and the lives of staff spectacular. Its the way the world is. Its to be expected, as the grown ups on the board of Nokia understood. And thats why those people are in those positions, they understand the business, the people and how that all works. It won't stop 15 year old keyboard warriors making up trojan horse theories. Real life however, is entirely more boring and dull that the excitement they dream up.

 

Who says that it has to be 7"❔It could be a 6" device but maybe with focus on music.. Bad ass cameras are awesome, but some of us music producers want a phone that focuses on music production.. How about some Lumia specific apps that run on Lumia devices with a special update that brings sequencing capabilities to those devices. Maybe Microkia could get with Korg, Cakewalk, Roland, Boss, Akia, or Ableton for some Lumia specific software, and branding.. How about a accessory, similar to the camera grip, but music oriented❔It could have an extra battery, high quality speakers, and dedicated audio controls. Could you imagine a W8 companion app that would make importing tracks made on a Lumia device a breeze by using SkyDrive❔. At some point Microkia is going to have to offer other things besides camera technology.. What kind of "themes" can you guys think of that would make a cool device, pertaining to your interests❔For example Sports, Business, design, photography.... If Microkia really wants to put people first then they should make a line of more individualized devices,, maybe even stepping out of the Lumia brand... What could that brand be called❔

I was gonna mention that Roland owned Cakewalk, but apparantly it's being sold to Gibson, which unbeknownst to me owned "high-end consumer electronics (Onkyo, TEAC) and pro audio (TASCAM, KRK, Stanton, and Cerwin Vega). "

 

But..  WHAT'S THIS??  "However, Mac and iOS support for other products will play an important part in Cakewalk’s future."

Crazy.  I'm a fan of Roland (owned a mt32 for Sierra OnLine games!!) and Cakewalk (owned Pro Audio.  I just bought the Cakewalk Touch program when it went onsale on Steam for use with my SP2..  Sad news.

 

Yeah. Something like the "blades" for Surface 2 would be cool. Nokia needs to up its accessory segment. There are people who splurge more on the accessories than the actual phone itself.

Lets make that a multimedia specific device. I hate it when you have a juicy 6 incher without any codec support. It takes ages to convert when you sync videos form my laptop. Why doesn't MS release a good Media player for Windows phone? I don't mind paying for it for my 1020. This Media player should be free on 1520 and 2520

Hopefully the D&S business has a great home at Microsoft, with additional financial resources available in order to continue to innovate and produce the brilliant products that we've all come to love.

Wishing Nokia the best as they continue on with NSN, Here, and Advanced Technologies.  I'm really curious to see what the Advanced Technologies division will come up with in the future, as it appeared that they had their hands on some really interesting graphene development.  I hope that Nokia and MS will continue with future agreements so that the D&S division can benefit from exclusive Nokia technology.

I read that Nokia was paying $10 to Microsoft for each handset sold but Microsoft was paying $20 to Nokia for each handset sold. That fact forced Microsoft to buy Nokia, it was that or lose a ton of money on each handset sold.

I'm not sure if this will change anything, considering that money to Nokia could only be for telecommunications patent licensing and Microsoft only got the design patents, no?

Elop should be fired for his failure in choosing Windows Phone then failing to make it profitable. He certainly shouldn't still be heading up the new division under Microsoft. Unless this sale was the plan all along he has proven that he can't make WP successful and really shouldn't still be in charge. And he definitely shouldn't be the next CEO of Microsoft, imagine him failing there.

Except the sales of Lumia have grown massively with him as CEO.

Please, what other choice was there? Meego? LOL Android?

This played out like a game of chess, not what angry nerdy tech ragers want. The world revolved around Nokia due to Apple and Google. Nokia didn't stand a chance, they were a devices company, not an OS or Ecosystem company. Nokia ended up the only place it could, and Elop got them there quickly and reduced the losses hugely. Bashing Elop makes no sense.

It's easy to "grow massively" when your starting point is ZERO.
With him as CEO all that Nokia did was loose more and more weight in the market and more and more value.

Yes, Android would have been the option. Please try to remember that the decision to go with WP wasn't made last year. It was made in 2009-2010. Back then, Nokia would still be on time to actually go against Samsung.
You're right when you say it's a Game of Chess. And Eflop lost the game for Nokia by exposing the King.

those reasons are a joke, and they are not valid in countries where ppl buy nokia for its name and not the choice of OS, however during very initial agreeement nothing stopped Nokia from telling MS that hey, we'll produce 90%WPs & 10%Androids. and why meltemi was shutdown n N9 wasnt even launched in all countries fearing it would overshadow Lumia800.

 

Yeah if Nokia told MS they will go 90% WP and 10% Android MS would just either tell Nokia that they won't be giving the financial support or worse to GTFO, and MS would 100% have accelerated their production and development of the Surface Phone instead.  Negotiation is not a one way street, and you are optimistic to even think that Nokia at that time was even in the position to play hardball with MS.

MS needed a hardware partner, else why were they paying Nokia so much? anyways its history, no point in a debate.:)

Ok but honestly, does anybody really believe Nokia would have sold less phones if they had chosen Android? If Nokia released the 1020/1520 with Android, more people would have bought it instead of HTC, LG, and Sony phones. May be they wouldn't outsell Samsung, but they would outsell the rest. This would create massive sales for them and almost no left overs for the other three companies.

And no innovation in the smartphone software space because of the duopoly that would have created. Look at where Android and iOS are going with their updated UIs; can you honestly claim that there is no influence from Windows Phone's design style, for the better?

You can't prove that more people would've bought Nokia android over HTC, LG or Sony if Nokia would've joined Android. Everyone knows Samsung has Android on lock just like Nokia dominates the Windows Phone market share. Any new OEM that joins windows phone is going to have a hard time competing against Nokia at this point in time...

Nokia is the Samsung of windows phone

You are missing some information. If you look at LG they make screens. If you look at Sony they make screens and camera sensors. Nokia only designs. This makes vertical integration impossible. Because of that its hard to fight on price.

Has there been a smartphone manufacturer whose sales have decreased after picking up Android (HTC perhaps, but they had massive growth with Android before that)? In hindsight, Android would have been the best and safest choice, followed by Maemo(assuming no MeeGo), then either MeeGo or WP.

Motorola isn't looking too good, LG has been making losses/barely profitable for the past few years and Sony has had 8 consequitive quarters of losses with Android.  Then there is HTC which is a basket case despite releasing a well received phone - in short if Nokia was successful on Android then they would have done better then all of these companies.

So Nokia could not afford to go the way those companies have as they do not have a profitable other division that can subsidise the losses.

I think they would have bombed with an Android Lumia 800/900 (the WP one didn't sell massively), and been moderately successful with the 920.  But they would be at best barely profitable today and constantly looking over their shoulder at Samsung, and their maps division would be much diminished as googles services would be used instead.

I'll give you Motorola, but LG seeing zero losses as a total new comer to smartphone business isn't exactly bad, and they have secured 2 Nexus lines now. As for Sony, see below. HTC made record profits with Android, true, they lost that due to abysmal support etc.

http://www.phonearena.com/news/Sony-outs-Q1-earnings-report-firmly-back-...

Lumia 800 / 900 were what MS specs allowed them to be, Nokia would not have just slapped Android on them, so comparing them to anything is pointless. It's very difficult to say how they would have done, but I'd turn your evaluation upside down, and say that they would be, at worst, slightly losing money. Offline maps would still be desireable, and Nokia maps could have been made the default, as long as Google Maps were installed, and MS would likely still have wanted a license.

Thats what consititues to whatever marketshare WP managed to gather, specially in countries like finland, italy, latam, china & India.

L900 was deemed obsolete even before it was launched in many countries, is an example of WP pulling back Nokia, Nokia would have done equally well with any other OS with such exciting hardware, WP dint help Nokia, but Nokia helped WP in th regions that I mentioned and many others ofcourse case might be different in US where ppl were already with MS ecosystem and it did help Nokia in US

There was a reason why WP L800/900 dint pick up, MS killed them, making them obsolete even before they released in many markets and just shortly after their release.

No he didn't, he was stating that Lumia started at Zero (which it did) so it's easy for it to improve from nothing. However "Nokia" was losing more and more weight and value, which it did (it's market share steadily dropped and is only now increasing again).

And DJCBS, Nokia have nothing to compete against Samsung in the Android world now, not even build quality! 2009-2010 was already too late for Nokia to convince the growing loyal and rabid Samsung fans to change to a Nokia Android so they chose Windows Phone after Google's Samsung-biased rejections against Nokia.

I for one rather use a Nokia Windows Phone with their HERE services and Nokia apps pre-loaded than use a Nokia Android with no Nokia services and apps but Google's lousy services except for YouTube, Chrome Mobile and Play Store.

 

Also before you start bullying me European-style, let me give you a hint: Nokia made a working Android prototype phone, but it's way too late also when the time Google apologized to Nokia, Nokia were on their way to sell their Devices and Services unit which has succeeded halfway now.

Uh, in 2009/2010 Samsung was still strongly focussing on Bada; HTC and Sony were the Android kings at the time. It wasn't until June 2010 that the Galaxy was released, and even then HTC had a stronger hold of the Android pie and it was the Galaxy S2 that caused the shift to Samsung.

Nokia would have never competed with Samsung with Android. Samsung are in control of tons of its own supply chain and fab silicon. Nokia don't, it's that simple. Samsung would have always beaten them on latest tech to market, and price. Nokia would never have stood up against that. Even iPhone sales are diminishing in comparison and Samsung marches on.

This childish (I like Android, they should have done Android) desire is completely stupid. It was never an option. I'm sure Nokia (and Elop) were hoping WP sales growth was stronger, but the end result is good devices ending up at the home of the OS which might produce a posetive result, time will tell.

I wonder how 520 is still so much cheaper than any of Samsung's comparable offerings.

edit: Some of you seem to regard Samsung as some sort of a god of tech who is unbeatable head-to-head, that isn't true now and certainly wasn't true in 2011. Nokia after all had them beat for years.

MeeGo was, and is, a phenomenal operating system. I still 100% believe that Nokia should have focussed on it, it had perfect integration of social networking apps (much better than all other operating systems at the time, and even currently), a fully fledged multitasking design, plus a notification centre that was well and truly ahead of the curve.

Plus it had the best of all aspects, an intuitive, easy to use home screen system, with an incredible level of bare bones customisation by people willing to do so.

The new Jolla phone is one of my most highly anticipated devices as it's, quite simply, running the best mobile OS I've ever used. If you look at the N9 it received infinite levels of praise from every critical review, the only killing blow was it was a one of a kind, and naturally every single review hammered that home (much like the lack of apps with Windows Phone) but it was still the most highly viewed phone, and highest rated phone, according to gsmarena page views, it even well and truly trumped the just released iPhone at the time (which was at the height of the iPhone's popularity), I think it was the 4S from memory.

My N9 had a few slowdown issues towards the end once I crammed it full of apps but it was only running a single core at the time, and they were fairly minor issues.

Elop destroyed Nokia just when they had the ultimate device to get them back on track, all it would have taken would be getting a Dalvik Virtual Machine running on its successor (so it could run native Android Apps without all the OS crap that bogs down a number of android devices) and you would have the perfect device, with all the apps (well, probably 90%) of the Android market, without all the baggage that goes with it running on the leaders in phone innovation and design.

But what do you expect this was always going to happen when a leading executive of Microsoft takes over Nokia, of course the ulterior motive was to get WP out there, they knew Nokia are second to none when it comes to design and durability (as well as name, although that had faltered over the years) and they latched onto that.

Gah, sorry about the rant, it just reminded me of where Nokia could have gone.

Meego was good no.

Meego had an ecosystem attached to it, no.

Meego would have survied against Android, no.

Elop destoyed Nokia, no (he actually reduced losses hugely)

Bla bla I love Android they should have gone Android. No. Android would have been insta-death up against Samsung. Samsung fabs the silicon, newer tech to market first, cheaper prices. Game over.

This childish personifying companies, like Elop is Nokia, or Ballmer is MS is so ridiculous. When you grow up (and I mean that in a nice way) you will realise large companies don't move that fast and sometimes competitors just by chance end up moving past you. That happened to Nokia via Android and Apple long before Elop arrived. Elop just hurried up the transition to WP, and reduced their losses and stopped them peeing money away on Meego and thousands of developers who developed a pile of cr*p compated to iOS and Android. WP was the only option on the table, and Elop just tidied the company up. It was death or sales from 2007.  Its just a company, no need to rant, there are other companies, stop taking it personally (mental) and stop thinking you know the answers, cos Android wasn't it.

Fired for choosing Windows Phone ❓❓
Are you out of your freakin' mind ❓
Stephen Elop and the fantastic Nokia team should have been knighted and covered in gold for bringing the Lumia series to the world ❕❕©
Having the fantastic, beautiful, yellow Nokia Lumia 1020, I couldn't care less about any Android phone. Newer will I go back to such a laggy and messy phone OS.

umm..had Nokia not gone windows phone, you can currently see the interest other OEMs are showing in WP..

maybe the whole platform would have been abandoned, and you wouldn't even have been on this site today..

Elop is a good guy. he made the best decision possible, by differentiating from competition.

after that, Nokia could have flourished a lot. you might have noticed how many add-ons they gave with lumias, in terms of apps, services and hardware, that weren't there on (leave android and iOS) even other WPs!

so Nokia was doing all it possibly could.

the real reason i feel Nokia fell this way (curse me, if you will) was Microsoft. the pace at which they were developing the platform was too slow. they were just lost in their own world, not attending to customer requests. then the abandoning of WP7 devices happened. lumia 900 was abandoned within months of its release. 610 and 510 were released on the claim that WP7 would serve as a low-end WP platform, but that remained a mess too. they did sell a bit though. so yeah, losses. and also faith of customers reduces due to such treatment.

even after WP8 was released, the updates were slow, and came with minor changes. if you compare WP GDR3 to BB OS 10.2, the number of improvements is much greater in the BB OS, and they were significant too.

besides, a number of MS services were restricted to very few countries.

so yeah, Nokia was in a weak postion, and the lack of proper support from MS is what actually lead to it's destruction.

had the OS been supported well enough, today Nokia would've been at least near Apple in terms of devices sold.

but whatever, can't complain now. it's all over and done with.

hope MS makes good phones and offers services globally like Nokia, hereafter.

and yes, i'd be happy if Elop becomes CEO.

Thanks for the nice summary. People who live in US, just don't get what Nokia was and some of them are real WP fanboys.  Nothing wrong with that.  But to say that Elop saved Nokia is just beyond my understanding.  If Nokia had not put 2016 limit on Symbian devices, that sucker will still outsell WPs. Don't believe me then just go and crunch numbers from last few years.  WP is a great platform but somehow Microsoft didn't move fast enough relative to competition.  When you are underdog, you gotta play hard and give more to your consumers.  Microsoft miserably failed and Nokia just got tired little too early (or maybe they got scared with decline in phone ASP).  I don't understand Nokia's decision, restructuring was almost over, they already moved all their factories from Europe to Asia and South America, why on earth they decided to sell.  Or they were looking for buyers all along since they started restructuring in 2011?

They sold, because they bought. Smartphones lost more money Q3 than they did in Q2, despite the growing overall sales, so they bought the rest of NSN for quite a low sum. Unfortunately, that left their cash position very vulnerable and every projection ever made, pointed at smartphones not becoming profitable for a long time. So their ability to buy components and pay salaries and other expenses was becoming unstable with only increasing WP costs in sight (MS platform support would supposedly end by the end of this year). They made a decision to survive as a company, probably the best decision they've made in the last 10 years.

*Sort of on topic, but wanna say it anyway* At least we were a part in the "Nokia era" where phones became majorly important and forever more awe inducing, this was all thanks to Nokia, and although the new Lumias will have been crafted with the very same hands as the phone i am using now, they will never be the same, but this is not a bad thing at all, they will be the new era of smartphones, built with more confidence and handled by a more successful company: Microsoft. My next phone will almost certainly be a Microsoft Lumia

The biggest change is that there will be more change. What do I mean is that Nokia will be able to talk to Microsoft a lot better than before when they're under one roof - phones like the 520 could have been released sooner if they had been able to talk more often.

I really doubt that, the success of 520 has very little to do with WP (apart from WP maybe supporting the chipset, which is easily communicated), the success comes from the best value for money hw, with an overall smooth OS.

He is Microsoft Trojan Horse.($25 millions is proof)
This guy eat Nokia inside out and then sell it.

Somebody please throw this evil out of Nokia company otherwise Nokia will be doomed.

He's going back to where his heart belonged all the time once the deal is done: Microsoft.

 

The one Nokia should throw out would be Siilasmaa, for enabling Eflop to do what he did.

Yes. Elop should've sold his soul to google like Samsung and every other significant OEM has (sarcasm).
I for one support Elop and will be happy to see him improve upon the "One Microsoft" roadmap when he becomes MSFT next CEO.
Since his heart belongs there...

Look at how many companies have had to get out of the device side of their businesses. Unless you are completely vertically aligned like the S. Korean and Chineese companies you are going to struggle.

 

MSFT is going to struggle.

Exactly. Nokia would have died running Meego or Android. Premium was the only place to go, and the only decision on the table was Windows Phone (Apple weren't going to let them make iOS devices ;) )

Why the pea brains on the Internet can't get their head around that I don't know. But I suppose it suits a juvenile mind to think he is a trojan horse, and the reason I don't watch TV news or entertain policics. Humans can't even understand or comprehend their own human condition.

Not sure MS is going to struggle, as they can just ditch if they lose too much and it won't impact core business. But they do seem determined to cement 3rd place and press on. For me, a lot hinged on the next release due Q1 2014. If they make major improvements, and with the app gap almost closed they could be a serious contender. If blue is minor, it could really slow them down or count them out. Interesting times. Get popcorn :)

those reasons are a joke, and they are not valid in countries where ppl buy nokia for its name and not the choice of OS, however during very initial agreeement nothing stopped Nokia from telling MS that hey, we'll produce 90%WPs & 10%Androids. and why meltemi was shutdown n N9 wasnt even launched in all countries fearing it would overshadow Lumia800.

 

and you are self proclaimed expert? ;)

so you make 90 wp phones and 10 android,right?you sell all the android phones in one day and the other phones in 2 months..........naaa it doesn't work

hwangeruk

From what I see of your analysis I am with you.  Of course I am no expert myself....

I do agree wholeheatedly with your statement:

"For me, a lot hinged on the next release due Q1 2014. If they make major improvements, and with the app gap almost closed they could be a serious contender. If blue is minor, it could really slow them down or count them out. Interesting times. Get popcorn :)"

WP 8.1 really needs to shine and provide polished features for consumers other than "simply" making a step towards the unification of stores/markets across the various MS OS's.
yes, get popcorn....

They will struggle, but there is a lot more going for them than is apparent. Remember Tim Cook's comment about MS in the smart phone space? MS has cross licensing deals w Apple, neither if them care much for Google, and MS has been happy to wade into the lower spec phone range at lower profits where Apple simply won't go.

In this game, MS really should get/keep their act together to make us happier faster, but even if they don't I think they will still rise to be a significant player and make it tougher on Android hardware OEM's

Of course Siilasmaa would come in defence of Trojan Eflop. Just think about it: he's the bloody CHAIRMAN. It's also HIS fault that Nokia is where it is. He was the one enabling that moron Eflop to drive Nokia to the ground. To not defend him would be to admit he, as Chairman, also screwed up big time. Which puts his position in question too as Chairman.

 

A surprise would be if Siilasmaa would admit he screwed up by allowing Eflop in and therefore he would resign as Nokia's Chairman. Of course he won't do that. Just like Bill Gates didn't resigned as Chairman of Microsoft after the flops of stuff like Windows Vista or Zune.

@DJCBS You can call people names but to call Elop a moron tells exactly who you are and you just lost every credibility you've ever had in this forum. Shalom

"Call the horses by their names" is a saying we have here. Believe me, "moron" was really really really soft when it comes to how I feel about that person and what he did to Nokia. Everyone who's a regular here knows that ;)
 

I say he's a genius! Either way, I don't care, but I just sold my shares in Nokia and made a tidy little profit off of a 250% return. Life is good.

The irony of that saying is that your names for him are your opinion, whereas the saying refers to calling people as they actually are. I may think you're a moron, but that doesn't necessarily make you so or give me the right to call you that.

I actually agree with you here, Elop specifically siphoned the N9 (arguable one of the highest rated mobile devices EVER) to countries that didn't really matter in an effort to quell their sales and get the Lumia out there and guess what, the N9 sold ridiculous amounts while the Lumia faltered becuase it was a better system and it just plain worked. The swipe UI was ridiculously intuitive and it paved the way for how we use phones today, even just little things like Glance, double tap to turn on, integrated swype keyboard, the device was insanely ahead of its time and it shows in that so many other devices then latched onto its key features (swipe controls being the main one). That still didn't change the mind of the "Nokia" head.

The only reason I use Windows Phone is because Nokia make exceptional devices, I wish they had of gone a different way but I guess there's no use complaining about it now.

While I don't know what to think about how N9 was treated, but it did launch at a very high price point compared to competition (spec-to-spec).

Nokia was on the brink when he started. Nokia is slowly on the rise. And the risk of going with android I believe was too high. Look at other android OEMS struggling.

I bet they would have been in better shape now if they had chosen Android. Does anybody seriously think they would be in worse shape at this exact moment if they would have developed Android phones?

Maybe, maybe not. But the smartphone space would be in a worse place, if not already then very soon. Duopolies help noone.

Agreed Windows Phone needed a boost to even things out, but Nokia dominated Samsung, Motorola, and Sony on the Symbian platform its strange people think they wouldn't have done the same with android.

At the time, Nokia committed to Symbian just like they're commiting to Windows Phone now, and they are wiping he floor with Samsung and Sony again (when it comes to the same platform). At the time, Sony and Samsung didn't know what they were doing, and the only example of a great consumer smartphone OS was Symbian. Nokia had a massive head start and continued to dominate because no one else came close.

If Nokia joined the Android camp, even back when the WP decision was made, Samsung would be taking the 'Nokia' place from Symbian example, and Nokia would at best be a Sony. They may make some ground over timer, but top long for the board and investors to be happy with it. They also couldn't differentiate themselves in the same way they can with Windows, making the challenge even harder.

They may be struggling, but Nokia wouldn't have. They had it, everything they needed. All that was left was to top off perfect hardware and the sweetest phone designs with an awesome OS. Don't see what could have gone wrong here.

Nokia's been many things. They're a centenarian company. They've been here long before our fathers and some of our grandfathers ;)
But they only became big in the 90's when they turned to mobile devices.

There two group of people who blame Elop. The Finnish, understandably. But most Finnish understand the situation, they don't put blame on Elop. They know no one would do any better.

Another group people are those garbage people from open source community, they hate anything from Microsoft, pretty much like those assholes in the US media. Those assholes are going be screwed in the comming a couple years, until they shut up. Those people are total disgrace in technology.

brutal

but yea, I have no love for the linux fanboys and their implacable hatred of everything MS

The MS hatred makes it very difficult for me to read the comments over at Tom's hardware or at the Register...

There was only 1 of 3 places that Nokia was heading back in 2010 when they partnered with Microsoft to use the Windows Phone OS on all new smart phones.

1st - They could have continued to develop and use megoo and watched their market share reduce month on month until it was down to 0.001% at which point they would be irrelevant and would no longer be able to sustain the business model and would have been bought out or simply folded.

2nd - They could have adopted Android for their smart phones OS moving forward however this would have presented a huge risk for the company and the shareholders. For example if you look at HTC they were once the dominant android manufacturer and were outselling Samsung that was until they released the Galaxy range. Since that time Samsung has increased its share of the Android market and is pretty much the only profitable android manufacturer still around today. So it is highly probable that Nokia would be in the same position as the other manufactures and would also be loosing massive amounts of money each quarter, until they could no longer sustain the business model and would have been bought out or simply folded.

3rd - They could partner with a new and upcoming OS from Microsoft that has the financial backing and established ecosystem to support Nokia and to market the OS into a viable 3rd OS option. Yes this again is a risk for the company and the shareholders however it would be a much more sensible business decision as Microsoft would be offsetting the reduction in cash flow with cross license deals etc, etc

To some extent the 3rd scenario hasn’t really worked out that well for Nokia as they have been bought out by Microsoft, however it has allowed Nokia to re-establish the company as market leader in smart phone design and tech and has set the foundation for Windows Phone moving forward under Microsoft.

+920
+Surface
+Xbox
+Xbox Music/Video
+MS

The future is ecosystems. Hence Apples initial success. Nokia and MS is the future :-)

Agreed. There is no profit to become an "also ran" in the Android market.

There are 2 conflicting threads going here: 1) Software and UI are everything; 2) Hardware is everything.

We hear the arguments on both sides - "Gee, I wish they would release the HTC One on Windows Phone." "Gee, I wish they would release a Lumia 1020 with Android."

As noted, Nokia had 2 choices. Keep hawking the dying Symbian line, go all-out on MeeGo or go with Windows Phone or another OS. Remember. Every Android handset sold must license through Microsoft was well.

We also seem to think that Microsoft just got off the boat with Windows Phone. For years they had a highly competitive OS. But it got a little long in the tooth and soon iPhone bowled them over. There was a lot of speculation on what MS could possibly offer in Windows Mobile 7. And as much as many of us who used the CE/Pocket PC devices might have liked to stay there, the market had long run away from that model.

So Nokia hires a new CEO. As with all (we are getting near a time to watch what a new CEO will do at Microsoft) people elevated to that position, they are hired to breath life into a possibly fading company. They are brought in to do exactly what Elop did - Take a chance and shift direction. Good, bad or indifferent, they will make an impact, step on toes, bring in new blood, and otherwise try to invigorate the company.

Were it not for this partnership, would we have heard as much about the "next" wave of Nokia devices? It goes beyond marketing dollars and infusions of cash, but that is a big part of it. It created a buzz about the devices and we are just now seeing the results.

You can mock the 3.6% market share with 153% growth. What is the result if they have similar growth with a new wave of devices in 2014 riding a reborn WP 8.1? Suddenly we would be looking at double figure market share and believe me, Apple and Google know it.

1 - who knows, WP did not exactly soar to greatness either, MeeGo could have worked, and it would have supported and been supported by BB10.

2 - Most Android OEMs are making a healthy profit, remind me again which OS gave HTC their best chance, and made their smartphone very profitable? It's not like Nokia tech, design and services aren't appealing to Android users.

3 - WP ecosystem practically started when Nokia joined

Not saying going with WP was the worst thing in the world, had both MS and Nokia done a better job, they could have done big things, but dismissing other options without foundation or with made up "facts", is just dishonest.

Most android OEM's are far from making a healthy profit, most however do have other business units that offset any loss in cash flow, with the exception of HTC.

Even with the release of the HTC One which is one of the best Android phones available, HTC are struggling with cash flow and cannot compete with Samsung.

I'm pretty sure that Nokia (Elop as well as the board of directors) did not enter into this agreement without first weighing up all possible options and impacts to the company, the staff, the customers and their shareholders. Tough decisions need to be made in business all the time and they are not always the right decision, in this case it was a damned if you do damned if you don't scenario.

If you are going to make a positive claim, I'd like to see some facts; numbers for global smartphone OEMs.

Sure, they analyzed options, and one of the parameters seemed to still be arrogance (we can make a success of this platform that hasn't move anywhere in a year, even if we have to screw over our customers in the middle of it all). Who knows what would have happened with other options, which had many strengths of their own ranging from ecosystem benefits to hardware benefits to ecosystem unity, but challenges as well. I believe they entered WP -ecosystem because they wanted "the easy way to the top", that they thought the MS ecosystem would win out, and planned to be the leader there and through it the leader of the market, again.

As a gadget nerd, I only wish I could live through the realities where they chose differently, if only to see the devices they would have released.

P.S. While I think Elop didn't do a perfect job, I do think he streamlined and focused Nokia's efforts very well.
 

First of all Nokia and MSFT announced the partnership 4 months after WP launched not a year. Second this agreement would have been in progress many months prior to the announcement and probably even before WP was launched.

Yes there is no hard evidence to say that they would have failed if they continued with Sybian/Megoo or took on Android however there is also no evidence to suggest that they would have succeeded. At the end of the day MSFT obviously put a compelling case forward as to why the should choose WP over the other options and Elop and the board of directors agreed that it was in the best interest of the company, shareholders and staff.

If they chose not to go for WP and still failed you would have the same people complaining that Elop killed Nokia

however there is also no evidence to suggest that they would have succeeded

No hard evidence, true, but the relative success of even PC OEMs in the mobile space, does give Android a certain... appeal.

Nokia board has been one big mistake since 2004.

I am all for WP and Lumia combo. Just look at the number of devices they have, all without compromising the core OS functionality. That alone is a great differentiator from Android - successful or not. iOS doesn't even figure. And needless to say of Nokia devices about to launch in 2014 with Windows Phone 8.1 as evleaks leaked a few weeks ago. That is how you show passion irrespective of whether you're being bought out or not. Other OEMs might have similar workforces but atleast to me, it doesn't show up in the products that they make. But I have a honest question though. Couldn't Nokia have re-written Meego/Symbian knowing what future smartphone capabilities would be? Would that have been real hard? And if it had indeed happened, would it have had a considerable impact on other mobile OSs?

wait a minute.....so Elop wasn't a Trojan Horse and this was all purely coincidental?

hahahahahahhahahahahahahahahah

hahahahaahahahahahahahahaahahahahahahaha

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I like Siilasmaa. He's a funny guy

Just as Lucas is now in the hands of Disney, Nokia is now in the hands of Microsoft. Lucas wanted to preserve the name for centuries to come, and that means implementing your company into the most guaranteed route. Or Nokia could pull a "blackberry" and fend for themselves. Its a smart move, just takes some time to see the gratifying results.

Oh please! Elop was a frigging mole! Nokia had THE market in Asia and Africa. They could have taken advantage of the Android OS and made mega sales if Elop hadn't been planning to take the Microsoft way.
Yeah, he's hardworking alright. He succeeded.

You think the competition will just sit there and let you wade into the mobile word and take the market share? Apple will take any chance to sue you and ban you off their territory. Samsung with their super semi conductor manufacture muscle and their dirty tricks. Microsoft with a new platform and their patent properties. You choose android you are facing 3 enemies on your face, or you join one and get cash injection and muscle to back you up?

I sure wish Blackberry had an Elop instead going the route they did. It was almost an impossible task for any company to break in on the Apple/Samsung juggernaut but Elop has given the Lumia line a fighting chance and in contrast to Blackberry he leaves Nokia with a future still intact for them.

Take a look at Crackberry and you will see how they are taking the "back alley" approach to adopting Android. And this has been happening since their failed attempt at a tablet! It's making me more interested in Windows phone.

I really dont understand why some people are still compaining about Microsoft acquistion of Nokia. Why do thez want Nokia making Android devices ? Dont they have enought of Android from China ?   Better Microsoft than Nokia than bought by Huawei and other Asian sh*ts or in the worst case by GOOGLE

Because they complaint MS didn't pay enought for their greedy pocket! They were looking for Nokia  stock price at $50/share?!?!?!?

I agree for the most part, but to say "people in those positions" make the best choices for the company is false, many time is the worst decision are made by them, Blackberry, HP, HTC, Motorola and many more come to mind of people who sat back and watched the company come to ruins.

It's funny how some people say Nokia should've gone Android, and who who'd give them the similar amount of money Microsoft gave them in order to make this lovely Lumias? People tend to enjoy the comfort and awesomeness money brings, but after spending it, they quickly start riding on their high horses and talk about the evil capitalism.

The nokia you all talk was more than just phone bussiness. They were also a service company they just had bought navigon and were making their here mapping suite. They allready wanted to migrate to a service company from a device company. So for let's see how options looks to the WHOLE Nokia:

1. Use their own OS. They failed with symbian. Maemo meego was using a chipset that as we see later was out of production and was continously delay. You complain about the lack of apps now. Imagine a Nokia without cash to lure developers trying to push their own OS. And remember their OS was using Qt so it requires specific software engineers had no great IDE at their disposal. Nothing to streamline and ease the development to make it cost efective. For consumers and for carriers a 3rd alternative is good. But for companies that have to spend more money to support a new 3rd platform this is not heaven but a burden. So here we have OS software delays no ecosystem to be build no hardware as texas instrument caceled the chipset

2. Go android without cash to back them up. We now know they had an android prortotype in work but that is not the whole story right. A prototype in an unknown shape so we can't judge more about the status of the android. But supporting android since it's open source means that they also have to supoprt the android kernel with software developpers since the OS is not totaly outsource. Beside having to spend resources on both their specific apps and OS development there is a point that people forget about android. It also costs even if it open source. And in this case they do not have MS to pay them an additional 10$ per device sold. And again Nokia is not just a device company. It's also a service company. It does not matter if they bundle their nokia here service on the decive. Android users will still use the google maps. And a mapping service is run by using the users to map. You can't have google maps or nokia here or apple maps without users using your service and pouring back data in to it. Only this way you can refine and curate your data and improve your services. Going android will have hurt their service division since they could have not push their here services over google maps. So devices division lacks cash infusion the ability to differentiate, they loose their brand recognition and awarness since they can't provide something unique. Service divisions looses users to google services. I don't see where they can move with android.

3. Go with MS ecosystem. Yes it's new it's in the beggining. But it frees nokia software resources to go in to exclusive apps. It frees them from providing OS support or the tools to support developpers and also gives them an active partener in luring developers to their side. Althrough it's a new ecosystem it uses previous MS software stacks so there is a bigger trained pool of professional out there. Also the ecosystem is supported by a big sotware giant mittigating somehow the costs for supporting a 3rd ecosystem for the ones that have to make the apps. Also what NO ONE has the guts to admit this deals helps the other side of nokia, the service division. In this deal they get to push their here service on the entire WP ecosystem not just their devices. Elop signs that deal where nokia here maps division is beind the entire ecosystem. So now they can push their service to users, now they can hae user giving them data to improve their map services. And they also get MS money to lure developpers, for marketing campaigns for everything. They even made MS to cache the maps offline in the latest OS version. In this case the entire Nokia wins: devices division get money, outsources OS development and sotware development tools, get to use abundent chipsets not obsolete ones, have a change to diferentiate. Nokia service division get to push to the user their services and not only that but they integrate their services on the whole WP ecosystem.

So tell me for the WHOLE Nokia not just smartphones division which deal was better? I trully think that Elop as an ex person from MS was able to get them the best possible deal in their relations with MS. And now everyone hates Elop, well because haters are still gone be haters

I was once told by an ex-Nokia developer that MeeGo was a dead end, he just never told me why. This was before the whole WP thing when they were thinking about Android

your spelling is not hot, but your analysis seems ok to me

of course I cannot verify some of what you are saying...

 

Come on Finland, you lose the handset division but you still have more heavy metal bands per capita than any other country in the world. And that's still better, after all.

True. I'd still expect WP market share to either crash or the growth to halt in Finland, not a huge blow to WP though.

My stocks of Nokia back in early 2000 were collaped to almost ZERO (as wel as their Finns's shares).

For the last 6 months, these stock going from 50 cents to $6-8. Won't that great? What else do they want from this guy?

I think those boad members didn't know the technology market well....

Try tell nationalist blinded europeans or fins that a company si a bussiness :). Very few can understand that in the end it's a bussiness and a CEO must be judge by how well the shareholders are doing in the end.

  Shareholders want CEOs to work miracles and rarely look at the realities of the situation. When Elop stepped in, the company was backing a dead OS and had the choice of either continuing to back that dead OS and watch their marketshare continue to erode, jumping into the over-crowded Android camp or making a deal with MS where they could receive royalty checks from them to use their OS and only have to worry about making great hardware. The choice was pretty simple.