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A Word of Advice for Stephen Elop: “Android”

September 10th, 2010 Leave a comment Go to comments

…seriously!  I know it is antithetical to the Nokia corporate ethos, but a complete commitment to Android seems like the only viable strategic path left for Nokia’s handset efforts, and as the new CEO, you don’t need to maintain any foolish consistency with the decisions taken by your predecessor.

Why?  The most important observation is that the basis of competition in the handset industry has changed.  Don’t be like the old General fighting the last war.  This war is about the Apps and Services that people can use on their phones.  The customers don’t give a hoot about making phone calls.  Lord knows the popularity of the iPhone in places like San Francisco and Manhattan (where the mean time to losing a call/connection has to be less than a couple of minutes) demonstrates that the customers don’t care about many of the things that we in the telecom world think the customers should care about.

The easiest path would be to just copy the Samsung approach — they knew they were coming late to the Android market, so they invested very heavily in the engineering, distribution (eg, pricing to the carriers), and promotion of their flagship Galaxy S.  It may well work for Samsung, but even if you committed to the Android path on your first day Stephen, it will still be 2012 before the first Nokia Android phones could ship, so you’ll be coming from much further behind than Samsung.  That might auger for doing a bit more than this straight up the middle approach — but, this straight up the middle approach is not a bad place to start.

You could try something like the Motorola approach of “adding value” to the Android UI with Motoblur.  I personally find it difficult to see much value add here, but maybe there is a segment of the market that really likes this sort of stuff.  If they are seeing commercial success, the next question is how is this a sustainable source of competitive advantage?  OK, my biases are showing through — I wouldn’t recommend the “copy Moto” strategy for Nokia.

What I do think would be a potentially fruitful approach for Nokia in their take on the Android strategy is to focus on the Browser.  For all the things that Google has done well in their Android implementation, you’d think that the Browser would really kick butt.  But it doesn’t.  Google still doesn’t seem to understand the fundamentally different sort of Browsing one does when mobile than when sitting in front of a PC that has a reliable high-speed Internet connection.  There are times when I still want Opera Mini-like functionality.  HTML 5 is a great step in the right direction, but if Nokia took a more pragmatic approach to the mobile Browser, it could be awesome.

Other relevant posts on this Meme, Stephen:

Mobile Browsers vs Mobile Apps, Fragmentation

Apps as Basis of Competition in Mobile

  • Mike

    So true, Nokia has needed to make this move in handsets for a while, else we'll hear the last of the infamous Nokia ring tone echoing from pockets and purses….

    • andref1989

      Lol, laughable analysis really. I'm so tired of hearing the same washed-up terrible argument that I can't even be bothered to retort.

      The idea in and of itself is stupid, a cop-out and in no way shape or form a better option than their current strategy. Now run along.

      • Eric Ver Ploeg

        When you say that moving to Android is “no way shape or form a better option than their current strategy.” What strategy would that current strategy be? Continuing to flog Symbian, which is essentially a Nokia-only OS that is fine for low end devices, but not smartphones? Linking their embryonic Maemo OS with Intel's embryonic OS effort to produce a Frankenstein OS that is woefully late to market? Am I missing something here?

        I feel like I am not the only one missing out on understanding how dandy the “current strategy” is, since the Nokia Board of Directors felt they had to fire their CEO and head of smartphones in the last week. Maybe you could share your analysis, and enlighten us all.

        • andref1989

          And you think picking up a half assed, basterdized linux/java amalgamation out of the bloody blue with no infrastructure in place to support this project in addition to the time and energy it would take to retool their entire software engineering segment to support their project is a better one?

          This of course ignoring the money they've already poured into making their offerings open source?

          Yea bloody great idea

          • Eric Ver Ploeg

            The whole point of the original post is that the basis of competition has changed. Android and iPhone are winning based on a delivering what customers want, not what us engineering wonks want to build, or think are “better”. The sooner the folks at Nokia can get their heads wrapped around that fact, the better.

            I would genuinely be interested in hearing you your articulation of Nokia's better “current strategy”.

          • andref1989

            Android only really works well in the high end. High end prevents large enough volumes to sustain a company the size of Nokia and will leave a lot of consumers unhappy.

            If you want to alienate and upset your userbase in addition to practically becoming an also-ran as opposed to a competitor then sure, go ahead and pick up Android.

            How many people would pick up a Samsung for being a Samsung ? Or a motorola for it being a Motorola. Brand identity is important and given the recent comments by Google et al about reducing the customization that OEM's will be doing to their platform it makes it VERY hard to differentiate.

            But seeing as how your idea is the best, that's what Nokia should do.

          • http://verploeg.com Eric Ver Ploeg

            Today's “high end” is tomorrow's “mid-range”, and soon after that “entry priced”. Even today, Android runs on some mid-range hardware platforms.

            Your counter-argument is the one that senior Nokia execs have been using for the last few years. It is rational in that Brand has been the basis by which Nokia has maintained phenomenally good margins in the past. While the Android path may not allow Nokia to maintain their historically high gross margins, it could give them a shot at maintaining their position as the number one player. After all, Nokia still has tremendous competitive advantage in industrial design, and low cost manufacturing.

            I completely agree that people don't pick a Samsung because it is a Samsung (nor any other Brand, including Nokia). That is exactly my point about the basis of competition having changed. HTC has thrived by recognizing that fact; Nokia is struggling because they appear to be clinging to the hope that they can somehow hold back the tide back and have people buy a Nokia primarily because it is a Nokia.

            I’m not clear on the virtue of “large volumes”. Apple’s iPhone business became more profitable than Nokia’s handset business some time ago, despite much lower volumes.

          • andref1989

            Obviously missing my point

          • everploeg

            In re-reading your comment, the only point I didn't explicitly address was your point about “large volumes required to sustain a company the size of Nokia”. I can't really see any virtue in large volumes. Apple's iPhone business is more profitable than Nokia's handset business, despite much lower volumes.

            Maybe I mis-understood a point you were making.

        • andref1989

          You really shud be up for that EVP of Mobile Solutions job.