Wednesday, August 17, 2011

The rumours of Nokia's death have been somewhat premature

While it has been widely reported that Apple and Samsung are now the No. 1 and 2 in the smartphone world, that is only true if you count units shipped. If you look at units sold in the second quarter of 2011, Nokia is still number 1. Fox Business reported that "Gartner, which counts sales of mobile handsets to end users rather than units shipped by individual handset makers, said Nokia sold a total of 97.87 million units in the second quarter compared with 111.47 million units a year earlier, and had a total market share of 22.8%, down from 30.3%"

With the impending shift to Windows Phone 7, Nokia re-seller channels are keeping stocks low and trying to sell existing stock. Microsoft which looks panicky about its Windows Phone 7 operating system and seems to clings to every bit of news as some sign of a future for its mobile operating system should really just be pushing Nokia to get its Windows Phone 7 devices out the door. 

Something not realized by plenty of technology writers based in the United States, where Nokia has about a 2% share is that in Asia and some other parts of the world, the name Nokia is a trusted brand and could boost Windows Phone 7 sales.

Each day of delay in the release of a Windows Phone 7 device by Nokia risks the migration of a existing Nokia user to another platform.

Price point.
A Windows Phone 7 device today still cost a fair amount of money. You can always find grey market units for lower prices, but the cheapest Windows Phone 7 device we found in the Philippines with an official warranty is HTC 7 Mozart, which is now retailing for just under Php20,000. Nokia S60 smarthpones today start at around Php6K. If Nokia can manufacture and sell Windows Phone devices at substantially the lower price points remains to be seen, but a variant of the Windows Phone 7 operating system, called "Tango" is design to do just that.
If Nokia can hand Microsoft a 10% share of the smartphone market when it fully migrates to Windows Phone 7 devices by the second or third quarter of 2012, that will be more than enough. Apple's iOS operating system smartphone operating system has a 18.2% market share for the first two quarters of 2011, while Smartphones running Google;s Android operating system only had a 17.2% in 2010. In other words, 10% is not a bad start (Source: Gartner cited by Fox Business). The only  question is, whether Nokia can use it name to get Microsoft back into the smartphone game.

When? "So just when will Nokia take delivery of their first Windows Phone smartphones? Well apparently Nokia Windows Phone devices are being manufactured by Taiwanese firm Compal and the latest word is that Compal will begin delivering Windows Phone handset to Nokia sometime in September" (Source: Phones Review).

How many? Even when the Nokia Windows Phone 7 devices start shipping, which sold almost 100 million smartphones in the second quarter of 2011, appears to have only ordered 2 million Nokia Windows Phone 7 devices (Source: Phones Review). That is not a lot.

Too little too late? I think we will have to wait for the end of the first quarter of 2012 to find out where this is going, by than Nokia will be knee deep in Windows Phone 7 devices or will be headed to becoming a full time feature phone maker.

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