It’s not a secret that Nokia, the Finnish giant is going through a very, or rather, the most painful time of its entire life. Empires come and go, time changes, and people grow old. These are normal process of evolutionary changes in life. However, our actions or inactions could fast track these changes for the better or for the worse. This is the case with Nokia. The giant that once bestride the mobile phone world like the famed colossus.
All is not well with Nokia. Business is not moving as anticipated by its CEO. Mr. Elop has this to say during Nokia’s last AGM held in May this year:
“….we were disappointed with our financial results over the last year and most notably during the first quarter.”
He went on:
“It reflects both the transition that Nokia is currently undergoing as well as the increase in competitive pressures within our industry.”
That “competitive pressure within our industry” Mentioned by Elop is obviously from the sweeping effects the iOS and the android OS has on the industry. Samsung saw the light and aligned with the android OS. Why Nokia refused to do the same really beats our imagination. We said it then and we were booed by the then Nokia fans (where are they today?). It might still have been ok if they had pursued the developments of their Symbian OS, Maemo OS, and the Meego OS to logical conclusions. Those OSes have potentials and recently we have seen what another finish company – Jolla Ltd. is trying out with Nokia’s abandoned Meego OS in form of Sailfish OS now rumored to be coming out next month. Also with what we saw of the Nokia N9, we are sure Nokia still “had it in them” but somehow, they were persuaded to go the Windows Phone way by some unseen,shall we dare say, dark forces.
Nokia is hurting inside and it’s showing up in their desperate actions. It is restructuring. Trimming down so to say. It has the plan to lay off about 10,000 of its workers worldwide in the bid to save up about $2 billion by the end of 2013. That’s not all, VERTU, Nokia’s luxury handset subsidiary was earlier this year sold to a Swedish private equity firm EQT VI. It has also closed factories across the world, including its complex in Salo, Finland, although research and development efforts will continue at that location.
But that’s not all, Nokia gave a shocker early this month by confessing to its intentions to sell off its home in Espoo, Finland. Yes, Nokia’s headquarter, the luxurious glass and steel complex by the Baltic Sea valued at 200 – 300 Euros is being considered for sale. Reuter quoted Nokia spokeswoman Maija Taimi as saying:
“We are evaluating different options for non-core parts, such as real estate holdings, and that includes the headquarters”
Nokia further says as reported by TechCrunch:
“As we said during Q2 results, Nokia is re-evaluating all non-core operations, including its real estate. However, we do not have any plans to move our headquarters,” a spokesperson said in an email (emphasis Nokia’s). “As with most companies whose core business is not in owning real estate, it makes common business sense not to tie assets in real estate property but rather invest and focus in its core operations.”
“Divesting real estate is an entirely different thing compared to the location of the headquarters. As we have said many times before, we have no plans to move our headquarters.”
But there are more worries for Nokia as some investors felt they were misled when Nokia adopted the Windows Phone. They have taken Nokia to court. The suit was filed in a US District Court for the Southern District of New York by Robert Chmielinski, and claims that Nokia misled investors.
“Defendants told investors that Nokia’s conversion to a Windows platform would halt its deteriorating position in the smartphone market. It did not,”
We shall see how this plays out.
Is there a way out for Nokia? Will they come out of all these victorious and better than they were in their days of glory? Would they not have faired better had they adopted the android OS?
Let us not forget that we are talking about the smartphone platform here. Nokia still makes feature phones and their latest line up of asha range of feature phones are still selling well.
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