09 February 2011 | Author: J. Morton News Editor

Private Nokia memo reveals potential stratospheric shift for the manufacturer

Private Nokia memo reveals potential stratospheric shift for the manufacturer Long the league leader in smart phone shipments and sales, Finnish manufacturer and father of the Symbian OS Nokia received a slap in the face recently from Google's Android handsets, which powered past Nokia's home grown offering. And CEO Stephen Elop's taking it seriously.

"The battle of devices has now become a war of ecosystems, where ecosystems include not only the hardware and software of the device, but developers, applications, ecommerce, advertising, search, social applications, location-based services, unified communications and many other things," an intercepted memo from the mobile mogul stated.

"Our competitors aren't taking our market share with devices; they are taking our market share with an entire ecosystem. This means we're going to have to decide how we either build, catalyze or join an ecosystem," he said.

And while Google's Android OS has rocketed from zero to hero in under two years, Apple's busy coring Nokia's offerings in the high-end smart phone market as well, thanks to its iPhone range.

Elop cited that Apple had "changed the game" in its slice of the market, going from a 25 per cent take in 2008 to a near-monopoly of 78 per cent for 2010.

The Finnish manufacturer is expected to announce a new strategy to get its groove back this Friday, and some pundits have pointed to a strategic alliance with Microsoft as a potential new direction.

Speaking to PC World, Canalys principal analyst Pete Cunningham said Microsoft and Nokia could be a golden ticket, as Microsoft has created with Windows Phone 7 a viable alternative to iOS and Android, and Nokia, the world's largest mobile manufacturer, could prioritise the OS where rivals have preferred Android.

"It is in Microsoft's interest to attract Nokia, because it is the largest vendor in the world," Cunningham said.

Upon Android's eclipsing of Symbian as the number one smart phone OS, Strategy Analytics analyst Neil Mawston said Nokia would "have to do something radical" to "stop the rot."
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