The Nokia fate will be remembered as hostile takeover. Everything worked out in the favor of Microsoft in the end. Though Windows Phone/Tablet have low market share, a lot lower than expected.
But Nokia was a company that was already starting to falter when Elop came on board. What else could the company have done to survive? Their options seem limited from what we know about the marketplace. They could have release an android phone, but then they just would have been fighting for a piece of the pie that Samsung, Moto, and other phone makers are eating. They could have stayed with their phone OS and probably would have had just about the same fate as picking up Windows Mobile.
Maybe they would have had more sales with an Android phone, but I'm not sure it would have made a bit enough difference to prevent this buyout. Elop set Nokia up to be bought out by being a major windows phone maker. It may have been a better long-term bet than Android.
Fighting for share of the pie in the Android market would have created far more sales than fighting for crumbs of a virtually non-existent pie in the Windows market.
Having said that, I agree with your final point. If you view the whole thing as a setup to extract maximum value via an acquisition, it might make sense. They may have been worth more as a MS acquisition target selling Windows phones than they would have been had they gone down the Android path.
It's entirely possible that neither path would have led to sustainability as a standalone entity.
Release 3310 in smartphone world. With their strong brand they could create another indestructible phone in smartphone era that would sell for $199.
The specs could be weak, as long as it would be easy, durable and fast for regular users.
Nokia 3310 was phone for regular users. Phone that could drop, had few games, allowed you to download some ringtones.
Strong battery, good screen, water/shock proof. Put 8GB memory plus one SD slot, some ok-ish processor and 2GB ram (so it wont age after 1 year) + make put really good battery. No ridiculous screen resolutions, fingerprint readers etc - just durable smartphone for regular user.
With specs like that they might break even - but for sure they would steal european and growing APAC regions easy. Once they would get back they would release business versions that would help them to correct their profitability. Its not difficult for such a strong brand like Nokia. I was amazed how Scandinavian way of thinking (simplicity) vanished from the company.
If Nokia could deliver mentioned phone - I would use it for sure.
CAT is not Nokia. Nostalgia after Nokia in Europe is HUGE. I know that majority of my friends is vouching for old ways Nokia was doing business and they still believe that if Nokia could create 3310 smartphone way - they would go all in.
I don't think it's possible to roll back the clock like that. Nokia's Windows phones weren't that bad. Very well built, as far as I know. Yet no one bought them, so clearly there's a limit to what the brand alone could carry.
I think it is safe to say they had at least a slice of Windows Phone leaving the others to fight over the crumbs. With Windows Phone at around 4% of the market Nokia had most of that. The question then is could they have grabbed 5% of the Android market.
A small correction: They weren't fighting for the crumbs of Windows Phone, they were eating the whole pie (save a small slice for HTC and a tiny sliver for Samsung).
This is a very US-centric view. Other than the US market, Nokia was crushing rivals everywhere. They had amazing repeat buyers, generational buyers, and an almost invincible brand. People didn't give two hoots about Symbian/Meego .. they were buying a Nokia phone !
In my alternate fantasy timeline, I'm currently using an amazingly efficient Meego device which gives me as powerful an environment like Android, in a neat and simple user-interface [1]
that's just not true,especially in Europe.Mobile is driven by apps and advertisment. And who publish mosts apps and is willing to pay for ads? western countries.I doesnt matter for my business if WP is number one in Brazil(Nothing against Brazil,love it,and i have brazilian origins myself) if it has only 4% shares in the market I want to target ... Doesnt even matter for Microsoft,except for PR reaons. WP is a failure as today,Microsoft knows it.
Would they have done better with Android,hard to say,I think they would.Nokia is a famous ,in Europe for instance, Nokia means robust and quality phones.But we'll never know.
> They could have release an android phone, but then they just would have been fighting for a piece of the pie that Samsung, Moto, and other phone makers are eating
Nokia has never needed a software edge to crush its rivals. They just needed to keep making phones that wouldn't break if you dropped them.
When you already have a massive competitive advantage (Nokia's reputation for making reliable hardware), you don't dive into a niche.
Nokia was really good at competing in big markets. Back when everyone was using their various pre-Android stacks with similar levels of software prowess, Nokia was the biggest phone maker. Because they were competing in the biggest market and doing it well.
Then the market changed to "[Android] phones that are like the iPhone" and Nokia refused to compete in that market, going for the "[Windows] phones that are not like the iPhone"-market instead. And totally dominated it with a 90%+ market share.
But that market was tiny. And Nokia was size-wise geared to compete with Samsung and Apple. Cue massive collapse of business when expenses overtook sales.
I'm thinking more "inside job" that ended in a takeover.
Hostile takeovers may be brutal, but at least they are relatively "clean" compared to what Microsoft did. The takeover is not the remarkable part of this story, that was just the endgame.
I'm still surprised this was actually legal. I'm also surprised that the Finnish authorities just let this happen without at least a legal investigation or parliament hearings.
This guy was the chairman of the board at the time. Does it seem like he wouldn't do best for his company and risk national disgrace, all for what must be pennies to him?
Lower than expected? Whose expectance? Given Microsofts track record in mobile devices I think no one expected Microsoft to really be able to compete. And given Nokia's track record in smart phones, nobody expected Nokia to be able to push Microsoft up either. But as it is now, it seems they've actually been able to. They've managed to punch a small but significant hole in the Android market, against all odds, by building some truly excellent products.
Who'd have thought Microsoft would some day produce an integrated mobile product that you could prefer over an Apple product without being made out a fool?
> During Elop's tenure, Nokia annual revenues fell 40% from 41.7 Billion Euros per year to 25.3 Billion Euros per year. Nokia profits fell 92% from 2.4 Billion Euros per year to 188 Million Euros per year. Nokia handset sales fell 40% from 456 million units per year to 274 million units per year. Nokia share price which was at 7.12 Euros on the day Elop was hired, had fallen to 81% to a bottom level of 1.44 Euros two years later, after which it began trading at 4.14 Euros, up 36% on the day. Elop's success in negotiating the sale of Nokia's struggling mobile device business to Microsoft has been described by many securities analysts as a significant victory for NOK shareholders, particularly when viewed in context of failed efforts by Blackberry or HP to secure value for handset business owned by those companies.
I had to reread it 5 times. I am still not convinced. Yes, that last sentence gives me the impression it has the words "significant victory" and "success", but my brain is simply unwilling to accept that as a valid conclusion.
I figure how Elop pitched himself was "Let's try something crazy, and hey, we always have a plan B, I have an in at Microsoft." CEOs may have significant power, but they can't just sell the company with no buy in from major shareholders.
99.52% of votes were cast in favor of the Microsoft acquisition at Nokia's Extraordinary General Meeting on November 19, 2013.
But that's not what makes this a friendly takeover, because shareholders also have to approve hostile takeovers. This acquisition is a friendly takeover because the Board is in favor.
* Stephen Elop the former Microsoft employee (head of the Business Division) and later Nokia CEO with his infamous "Burning Platform" memo: http://en.wikipedia.org/wiki/Stephen_Elop#CEO_of_Nokia
* Some former Nokia employees called it "Elop = hostile takeover of a company for a minimum price through CEO infiltration": http://gizmodo.com/how-nokia-employees-are-reacting-to-the-m...