Nokia was once a powerhouse of mobile media and functionality. Now its all but relegated to commercial solutions or budget handsets. Where did this once champion go?
The new Microsoft logo for phone (Source: Microsoft)
Shares of Microsoft MSFT lost 4%, to AED 166.38 in extended trading on Jan 26th, 2014. The Redmond, Wash., company released its second-quarter results after the close of markets. Microsoft shares fell after the software juggernaut reported its Nokia and Windows businesses undercut profits. Shares of Microsoft lost 4%, to AED 166.38 in extended trading Monday. In Redmond, the company released its second-quarter results after the close of markets.
But there were some weak spots beyond Nokia. Computing and gaming hardware sales fell 11% because of Xbox platform sales, while commercial licensing revenue — which includes its Windows business — fell 2%.
But how did Nokia end up being a thorn in Microsoft’s profits?
Nokia first got together with Microsoft to build a mobile version of Microsoft Office that could run on Nokia's Symbian phones in August 2009. Though he would later become Nokia's CEO, Stephen Elop worked at Microsoft at the time and was part of the mobile Office efforts.
Stephen Elop, now the head of Microsoft's Business Division, jumped ship from Microsoft to become Nokia's CEO in September 2010. Elop replaced Olli-Pekka Kallasvuo and was hired to help usher in new changes at Nokia.
In February 2011, Microsoft CEO Steve Ballmer and Nokia CEO Stephen Elop announced that the two companies were teaming up to build Windows Phone devices. The hope was to bolster the Windows mobile ecosystem to a level where it could to compete with Google's Android and Apple's iOS platforms. There was also speculation in the tech community that the partnership was a prelude to an eventual Microsoft-Nokia merger.
The last stream of Nokia phones (Source: Microsoft)
Then in October 2011, Nokia announces its first Windows Phones at a press conference in London, the Lumia 800 and Lumia 710. The Lumia 800 was the flagship phone, selling first in the UK and parts of Europe for 420 euros, while the 710 was the first budget Windows Phone device in Nokia's lineup. Both phones shipped with Windows Phone 7.5 Mango and came with Nokia and Microsoft apps preinstalled.
The heads of Microsoft, Nokia, and AT&T Mobility gathered at CES 2012 to take the wraps off the Lumia 900. The newest flagship Windows Phone device flaunted a large screen, a Carl Zeiss lens in the camera, and LTE support.
Fast forward to July 2013 - Nokia shows off the newest flagship Windows Phone, the Lumia 1020. The Lumia 1020 wowed everyone with a 41-megapixel camera. The phone was the last major release before the Microsoft acquisition.
Stephen Elop (Source: AFP)
The Microsoft acquisition came as a surprise to no one, Stephen Elop has even a book written about his trojan like qualities and how he could possibly be the worst CEO ever. however what did shock a lot of purists was that Microsoft is ditching the Nokia brand name from new smartphones, less than a year after acquiring the Finnish firm's mobile devices division. New Nokia Lumia phones will instead be known as Microsoft Lumia, according to the company. The parts of Nokia that were not bought by Microsoft will continue to use the name.
The book on Elop insinuating his role in the Nokia takeover (Source: Amazon)
Windows Phone meanwhile continues to struggle against iOS and Android, with global market falling to 2.5 per cent. Microsoft will be hoping that Nokia’s ever-popular range of capable, low-end devices will eventually shuffle users in developing markets onto its OS, but nothing looks like it will shake Android and iOS in the high end.
There doesn’t seem to be a bright future for the Nokia brand. Many former purists have move on to newer more advanced platforms such as iOS and Android. And with the culling of the Nokia branding on high end smartphones, Microsoft has dealt a death blow to the Nokia Powerhouse that once was.