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Nokia Needs Healthy WP7 Ecosystem to Succeed

By Andrew Berg | June 2, 2011

Nokia CEO Stephen Elop addressed a variety of considerable challenges facing his company during an appearance at the Wall Street Journal’s annual All Things D conference. Elop stressed the importance of more adequately addressing the North American market, as well as fostering a robust ecosystem for WP7.

Nokia has fallen on particularly hard times as of late. Since it announced adjusted guidance earlier in the week, shares of the company have dropped almost 15 percent to $6.71.

In a video of Elop’s appearance at All Things D posted on the Journal’s website, Elop acknowledged that the company’s adjusted forecast was a difficult announcement to make and added that the pain would continue at least in the short-term.

Elop said the company is still shipping tens of millions of Symbian devices every quarter but that the United States doesn’t see the popularity the OEM enjoys overseas. Elop admitted that a lack of presence in the United States is a big problem, noting that in 2004 the company had somewhere around 30 percent to 40 percent market share in North America. Today, it’s less than 6 percent, according to Gartner.

He attributed the company’s decline in the U.S. to its inability to adapt to consumers’ preference for flip phones early on and then in 2008, the company again failed to answer the rise of the iPhone.

Under Elop’s leadership, Nokia has adopted Microsoft’s WP7 OS for all high-end smartphones going forward. Elop said the decision to abandon Symbian was primarily due to the fact that the aging OS couldn’t have evolved fast enough to keep up with other platforms like iOS and Android.

“Symbian was at a deficit competitively in some markets,” he said. “Our assessment of the speed with which we could respond to the competition was, ‘With Symbian, it’s going to take us too long,'” Elop said.

While Elop recognized Android’s recent rise to glory, he questioned whether the open-source OS could manage to continue to differentiate long-term.

Elop said he hopes Windows Phone 7 devices from OEMs like Samsung and HTC are successful, which would in turn drive the platform’s ecosystem, eventually attracting more developers to the platform.

“[Developers] need volume, they need scale,” Elop said.

Nokia has repeatedly said that it intends to ship its first Windows Phone 7 devices by the fourth quarter of this year. When asked whether they would be in time for holiday sales, Elop said “that is certainly an important part of the selling pattern.”

As for rumors that Microsoft might be interested in buying Nokia’s hardware business, Elop called them “baseless,” insisting that Nokia would remain master of its own domain.


Filed Under: Devices

 

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