Intern reporter Wang Chuan of the Investors Herald - On February 27th, Nokia (Weibo), which has been highly anticipated, unveiled its new flagship product, the 808 PureView, at the MWC2012 conference. As the successor to the N8, this phone had little to offer other than a 41 million pixel camera. More disappointingly, it still utilized an upgraded version of the outdated Symbian operating system.
Industry insiders pointed out that Nokia's insistence on using the Symbian system might lead the 808 PureView to follow in the footsteps of the N8. In the increasingly competitive smartphone market, it would be difficult for Nokia to turn the situation around. Sales prospects were not optimistic, especially since Motorola (Weibo) had already made a strong comeback after adopting the Android system.
The once-glorious Symbian system was dragging Nokia into a quagmire. According to Nokia's financial report for the last quarter of last year, Nokia had been continuously losing money for the last three quarters, with a loss reaching 1.07 billion Euros in the fourth quarter alone. In contrast, Nokia had achieved a profit of 745 million Euros during the same period last year.
An industry expert told the reporter from the Investors Herald: "Long-term stockpiling of mobile phones has caused serious losses for Nokia; the money earned is insufficient to cover operational costs." According to data from IDC and multiple other data agencies, Nokia's market share in developed countries such as the United States and Japan was less than 1%, leaving it unable to compete with other brands.
"Symbian is dragging Nokia down. Currently, almost all Nokia smartphones for sale use the Symbian system. The sales of the N9, which uses the MeeGo system, have been very poor," said a Nokia mobile phone salesperson to the reporter from the Investors Herald on February 26th, 2012. "Competition in the high-end smartphone market is fierce, and Nokia phones using the outdated Symbian system are simply unable to enter the high-end market. The cessation of development of the MeeGo system has left the N9 with few buyers. Now, only mid-to-low-range priced Nokia phones are selling relatively well."
According to information obtained by the Investors Herald, starting from 1996, Nokia mobile phones held the top position in market share for 15 consecutive years. In 2004, Nokia acquired all shares of Psion, the founder of the Symbian system. With the then-outstanding Symbian system, Nokia dominated the emerging smartphone market.
However, good times didn't last long. In January 2007, Apple released the iPhone. By then, Nokia's Symbian system was no longer suitable for the market. The following year, Google launched the Android smartphone operating system. Apple and Google redefined smartphones.
Nokia's decline became evident. According to relevant media reports, Nokia's share of the smartphone market dropped from 33% in 2010 to 14% in 2011. Its popularity in the Finnish market plummeted, with its market share falling from 76% to 31%, a drop of 59%.
Industry insiders pointed out, "Since the appearance of the iPhone in 2007, Nokia's profits plummeted from $3.5 billion to below $1.3 billion. Its market value shrank accordingly." Over the past few years, Nokia stocks have been delisted from the London, Stockholm, Paris, and Frankfurt securities markets. In 2011, Nokia closed online store sales operations in five countries including the UK, France, and the US. In August of the same year, Nokia announced its complete withdrawal from the Japanese mobile phone market. On February 9, 2012, Nokia announced global layoffs of 4,000 people.
Motorola Makes a Comeback, While Nokia Struggles
In fact, Motorola also experienced a downturn similar to Nokia. Motorola's dominance in the mobile phone market with its RAZR (razor) series first-generation product V3, launched in 2004, was comparable to the current popularity of the iPhone. According to relevant media reports, the total sales of this series of phones exceeded 100 million units.
However, the immense success of the V3 slowed Motorola's product development speed. In a rapidly evolving mobile phone market, the lack of product variety and innovation in the new RAZR phones led to Motorola's weak market competitiveness and dismal sales performance. By the end of 2008, Motorola's mobile phone sales had declined for seven consecutive quarters.
In 2009, Motorola partnered with Android to launch a new smartphone, the "Milestone," which immediately gained widespread user acclaim. The Milestone, equipped with the latest and hottest Android system, achieved remarkable sales of 1.05 million units in just 74 days in the North American market, surpassing the sales records set by the iPhone and becoming the most popular phone at the time.
Simultaneously, Motorola released five smartphones within eight weeks. The positive market response improved its financials, reducing its operational loss per share from $187 million in 2008 to a mere $5 million loss in 2009. Turning a profit was no longer an issue for Motorola.
Motorola made a strong comeback with the "Milestone," erasing its previous slump. After partnering with Android, it surged ahead. Vice President John Geddes publicly stated, "We will retain some of Motorola's classic software legacy projects, but new phones will unhesitatingly adopt Google's Android system because this system can help Motorola compete with the iPhone." Through a unified platform, Motorola quickly updated its products, changing its previously slow market response image.
Uncertainty Surrounding Nokia's Revival
Nokia gradually realized that Symbian was outdated, but instead of following Motorola's path, it chose to develop a new smartphone system based on the aging Symbian while actively collaborating with other mobile system developers to introduce smartphones with different systems.
Previously, the Symbian system was the most widely used smartphone system for Nokia's smartphones. Systems like Symbian3 and Nokia Belle were all developed based on Symbian. However, the post-Symbian phone system, which retained the same core as Symbian and focused mainly on interface development, inevitably faced criticism as "new bottles filled with old wine," resulting in underwhelming market performance.
Maemo was a mobile system developed by Nokia, later replaced by the MeeGo system co-developed with Intel (Weibo). Development of both systems has now ceased. In February 2011, Nokia officially announced a global strategic partnership with Microsoft, planning for in-depth collaboration in the smartphone sector. Currently, Nokia phones equipped with the Microsoft system have yet to appear in legitimate sales channels in the Chinese market.
"When the Android system was released, Nokia's Symbian system still had strong vitality, and no one expected Android to grow so rapidly. Now, most of the Android market has been captured by other phone brands, so whether Nokia can successfully revive by entering the Android market remains uncertain," an industry insider told the reporter from the Investors Herald. If Nokia switches to the Android system, its painstakingly developed Symbian system would take a backseat, undoubtedly a heavy blow to Nokia. Without Nokia's steadfast commitment to Symbian, Android could potentially dominate the smartphone system market, which might be good news for Android but not necessarily for consumers.
Moreover, Symbian isn't entirely without merit. Mobile phone analyst Wang Ying told the reporter from the Investors Herald: "Although Nokia has abandoned the Symbian name, the mature technology behind Symbian will not completely exit the mobile phone market. In the low-end phone market, Symbian still holds significant advantages."
Regarding the delay in the release of Nokia phones equipped with the WP7 system in China, Wang Ying explained: "Nokia may be avoiding direct competition with Android." Currently, Android dominates the Chinese smartphone market, but consumers might soon lose interest in Android, making it an opportune time for Nokia to launch its Microsoft WP7 system phones in China. Whether Nokia can make a strong comeback like Motorola remains to be seen after the introduction of Microsoft system phones.