Communities Dominate Brands Blog

pThis makes NO sense. Nokia CEO Stephen Elop himself has said that the war in mobile today is one of ecosystems, not of mere handsets or their software. Elop himself has explicitly mentioned advertising as one of the key components of a mobile ecosystem. If Elop practised what he preached, he would not be selling his mobile advertising unit, he would be nurturing it, growing it - not selling it.br /br /Google believes so strongly in mobile advertising, they bought Admob. Apple#39;s Steve Jobs believed so strongly in mobile advertising, he launched iAd. The company that invented the cellular telecoms industry - and launched the world#39;s first mobile internet service, NTT DoCoMo of Japan believes so strongly in mobile advertising, they created D2C the world#39;s biggest pure mobile ad agency. Even Stephen Elop#39;s past employer Microsoft believes so strongly in mobile advertising, they bought ScreenTonic, and today have mobile advertising a central aspect of the Windows Phone ecosystem. And what does Elop do at Nokia? He just a href=http://www.reuters.com/article/2012/01/27/us-nokia-advertising-idUSTRE80Q0ID20120127 target=_selfsold Nokia#39;s mobile advertising unit on Friday/a to a company previously known as Matchbin and now renamed Radiate Media.br / br / CENTRAL TO ECOSYSTEMbr / br / I don#39;t want to make this blog a monologue about Nokia. But if Elop does something this mad, at this time, then I do have to observe it. As it is Stephen Elop who has been lecturing the world about how the race in mobile phones is no longer one of hardware or software, it is about ecosystems. And Elop himself defined ecosystems as they relate to mobile handsets in general and Nokia explicitly, as:em quot;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.quot;/embr / br //p pemstrongAdvertising! /strong/emOne of the key components of a mobile ecosystem. And Elop has tried to rally his Nokia employees to engage in a battle of ecosystems. He warned that Nokia#39;s competitorsem quot;are taking our market share with an entire ecosystem.quot;/em He claimed last year in his notorious Burning Platforms memo that Nokia had fallen behind on this ecosystems war. He said that Nokia had emquot;lacked accountability and leadershipquot;/em and that Nokia emquot;had not delivered innovation fast enoughquot;/em. br / br / OBVIOUS MAJOR GLOBAL TRENDbr / br / Apple decided to launch iOS in the summer of 2009, at a time when the total global shipments of all iOS based devices, iPhones, iPads and iPod Touch#39;es had not passed 50 million cumulatively (including devices no longer in use). Yet Apple felt mobile advertising was that important to the Apple iPhone and iOS ecosystem. Steve Jobs himself explained why the ecosystem would be stronger with an ad platform explaining that emquot;developers have to find a way to make some moneyquot;/em and that the iAd platform was a way Apple could help its developers in its ecosystem.br / br / Google decided to buy Admob in December of 2009. At that time, there were far less than 10 million Android smartphones in use worldwide. By 2011, Google#39;s Chairman Eric Schmidt was saying that mobile advertising was delivering 2.5 Billion dollars of ad revenues to the company.br / br / I mentioned that NTT DoCoMo created D2C together with the Japanese advertising giant Dentsu. Microsoft got into mobile advertising years ago with the purchase of ScreenTonic. Major mobile industry players from carriers/operators like Vodafone and Telefonica to equipment makers like Ericsson and Alcatel-Lucent offer solutions in the mobile ad space. br /br /Mobile advertising (roughly) doubled in annual revenues in the year 2008 when the world economy crashed. Mobile advertising almost doubled again in 2009 and 2010 yet again. Early numbers say mobile advertising had again roughly doubled in 2011. By 2011 the global advertising industry had embraced mobile ads from Ford saying that mobile ads will be integral to every ad campaign they run on any medium, to US food giant Kraft saying #39;no mobile left behind#39;. br / br / If you believe in growth opportunities coming from those sectors of the industry that expanding most strongly, mobile advertising is that right now. Certainly Google, Apple, Microsoft, NTT DoCoMo, Vodafone etc see this and invest heavily in it. Is there any doubt, that mobile advertising is a key component in any ecosystem in mobile? None whatsoever.br / br / WHEN DID NOKIA GO mADbr / br / I happen to know the mobile advertising side of the mobile content and media industry quite well, as I was the first person to discuss commercially launched mobile ads at any international conference (in Austria) literally within weeks after they had launched (in Finland in year 2000). And I was honored to chair the world#39;s first mobile advertising conference in London the next year. That conference had many pioneers of mobile ad space, presenting, as were some big advertising companies who had launched their mobile advertising units. But there was only one handset manufacturer presenting at the two-day conference on mobile advertising. That handset manufacturer was ...Nokia.br / br / Nokia was studying the mobile advertising opportunity more than a decade ago, so much, that they had an internal unit looking at it (modest in size at the time) and Nokia had commissioned a global study about mobile advertising in 2001, long before most thought that ads served to our pockets were even commercially plausible. br / br / Nokia monitored the space, and as mobile advertising slowly achieved acceptance beyond some of the most advanced markets like Japan and South Korea (and Scandinavia) Nokia then got serious about mobile advertising when it bought Enpocket. When was that? In 2007 ! Two years before Apple and Google got serious about mobile advertising. And since then Nokia had developed the mobile advertising arm at its Navteq unit, and bought other mobile advertising companies such as Acuity Mobile in 2009./p p#0160;/p pSo is it factually NOT true (once again the Elop delusions) in this empirical case about fighting in ecosystems rather than handsets, that Nokia supposedlyem quot;fell behind, we missed big trends, and we lost time. At that time, we thought we were making the right decisions; but, with the benefit of hindsight, we now find ourselves years behind.quot;/em br /br /In reality, as it relates to mobile advertising (just like in mobile payments, location and mapping, app stores, videogames, music etc) Nokia emstrongcaught/strongstrong the big trend/strong/em, were indeed emstrongmaking the right decisions/strong/em, and with the benefit ofemstrong incredibly accurate foresight/strong/em, once again, emstrongfound itself years ahead/strong/em. The truth is 100% diametrically opposite of what Elop has been saying (once again). Nokia was not years behind, Nokia was literally years ahead of all its rivals in this space./p pbr / BATTLE OF ECOSYSTEMSbr / br //p pElop preaches about the battle of ecosystems. The Nokia Symbian platform, one of several Nokia technical platforms, and the one most suited for mobile advertising today, is not just the world#39;s biggest smartphone operating system by installed base - and emstrongadvertisers will equate installed base with #39;audience#39;/strong/em rather than new sales, where last year Elop#39;s mis-management of Nokia smarpthones saw Symbian sales fall behind Google#39;s Android and Apple#39;s iPhone iOS. But lets just examine that potential advertising target audience a bit more. Here are the world#39;s twenty largest countries by population, and the biggest smartphone OS as of November as measured by statcounter:br / br / COUNTRY . . . POPULATION . . . BIGGEST SMARTPHONE OSbr / br //p pChina . . . . . . . . 1.3 B . . . . . . . . . . . Symbianbr / India#0160; . . . . . . . . 1.2 B . . . . . . . . . . . Symbianbr / USA . . . . . . . . . . 310 M . . . . . . . . . iOSbr / Indonesia . . . . . . 220 M . . . . . . . . . Symbianbr / Brazil . . . . . . . . . 190 M . . . . . . . . . Symbianbr / br //p pPakistan #0160;. . . . . . . 170 M . . . . . . . . . Symbianbr / Bangladesh . . . . . 160 M . . . . . . . . . Symbianbr /Nigeria . . . . . . . . 150 M . . . . . . . . . Symbianbr /Russia . . . . . . . . . 145 M . . . . . . . . . Symbianbr /Japan . . . . . . . . . 120 M . . . . . . . . . Android/p p#0160;/p pMexico . . . . . . . . 110 M . . . . . . . . . Symbianbr /Vietnam#0160; . . . . . . .#0160; 90 M . . . . . . . . . Symbianbr /Philippines . . . . .#0160;#0160; 90 M . . . . . . . . . Symbianbr /Germany#0160; . . . . . .#0160;#0160; 80 M . . . . . . . . . iOSbr /Ethiopia . . . . . . .#0160;#0160; 80 M . . . . . . . . . Symbianbr /br /Egypt . . . . . . . . .#0160;#0160; 75 M . . . . . . . . . Symbianbr /Turkey . . . . . . . .#0160;#0160; 70 M . . . . . . . . . Symbianbr /Iran#0160; . . . . . . . . . .#0160;#0160; 70 M . . . . . . . . . Symbianbr /Thailand . . . . . . .#0160; 65 M . . . . . . . . . Symbianbr /Congo . . . . . . . . .#0160; 65 M . . . . . . . . . Symbian/p pbr / (above adapted from statcounter data from November 29, 2011, as reported by browserrank.com)/p p#0160;/p pYes! Nokia#39;s #39;obsolete#39; Symbian is the biggest smartphone operating system in 17 out of the 20 largest countries on the planet by population. And its not just that Nokia has this incredible reach. Consider the other competing advertising mass media.br / br / In the USA, the television market is the biggest advertising market and the biggest mass medium. In some of the more affluent markets on the above list, most households do have TV sets like in China and Russia. In all but one of the above countries, more people access internet content on mobile phones than on PCs (the exception being the USA where the half-point will be passed this year 2012). And in many of the less affluent countries on that list, even radio does not reach as widely as mobile phones. Like they say in Africa, mobile is not the 7th mass medium, its not the first mass medium; it is the only mass medium./p pbr / Nokia owns the smartphone OS platform that reaches the widest audience in 17 out of the 20 biggest countries on the planet. Where iOS and Admob and others face strong competition in advertising from legacy mass media like TV, newspapers, radio etc; and obviously internet advertising - Nokia#39;s Symbian platform is the emstrongdominant smartphone platform in all countries where legacy media is not established as a true #39;mass#39; medium/strong/em reaching even half of the population and where mobile access to the internet exceeds PC based access to the internet.br / br / Nonetheless, Apple#39;s iPhone has an installed based (not cumulative shipments, but active users) of about 150 million smartphone users today. Remember, for any iOS media partner - including any advertising, we need to add the other iOS users, iPads and iPod Touch#39;es, so the total reach of the iOS currently is about 240 million. Google#39;s Android reaches about 250 million active users today. Microsoft feels it worthwhile to continue building its mobile advertising unit even as its reach across both Windows Mobile and Windows Phone smartphones, currently, is less than 30 million. But Nokia#39;s Symbian has currently over 275 million users worldwide. And the CEO who thinks its a war about ecosystems, and believes that advertising is a key part of ecosystems, doesn#39;t want to keep Nokia#39;s competitive advantage here, one that Nokia years ahead of its rivals in discovering and exploiting?br / br / NOKIA TRUE REACH FAR WIDERbr / br / The above picture is not the full picture for a Nokia ecosystem. Nokia sells more S40 based featurephones, which use the proprietary S40 operating system (not part of Symbian) but which could be described as #39;smartphone lite#39; - just like Symbian, S40 does allow full internet use, allows application downloads and the use of the Nokia (ex Ovi) store for content, apps and services. Nokia does not give us a breakdown of the S40 sales, but Nokia recently celebrated the 1.5 Billionth S40 cumulative shipment number. In rough terms the installed base of S40 currently is more than 700 million, so when added together, Symbian and S40 give Nokia an addressable market potential of 1 Billion mobile phone users worldwide.br /br /(Note this does not include the ultra-cheap dumbphones that use the even simpler Nokia S30 OS, by which Nokia#39;s total reach was last year estimated at about 1.7 Billion)br /br /This ecosystem of Symbian and S40, plus Nokia#39;s other current and past OS platforms like MeeGo and Maemo; plus Nokia#39;s upcoming low-cost smartphone OS, Meltemi, are all supposed to be supported by the Qt developer tools of Nokia. So if we count Nokia branded Qt ecosystem potential reach, it is well in excess of 1 Billion pockets. And add to that the Android installed base (Qt supports Android) and potentially Blackberry (the new Blackberry OS will be compatible with Qt) - the Nokia #39;first ecosystem#39; if built around Qt has a potential reach of more than 1.35 Billion mobile phone users (more than 5x bigger than the total iOS ecosystem or the Android ecosystem; more than 12 times bigger than the total Blackberry ecosystem and more than 100 times bigger than the Windows Phone). Yet Elop is doing everything he can to sink that Nokia-controlled first ecosystem and replace it with what Microsoft tries to call the #39;third ecosystem#39; ie Windows Phone, which only reaches the pockets of less than 12 million people in the world, and is legitimately called at best, the 8th ecosystem./p p#0160;/p pELOP DEFINITION OF LEADERSHIPbr / br / We have seen it time and again. We saw it with the Ovi store, we saw it with Nokia developer relationships, we saw it with mobile commerce and NFC (the Lumia series does not support NFC while Nokia#39;s own MeeGo and Symbian both of course do support NFC). And now once again we see it with mobile advertising. Elop discovers a significant Nokia advantage in its ecosystem. Even as it is an element of genuine leadership, that is supported by essentially the whole industry as an obvious trend, emstrongElop goes against the trend. He damages the Nokia version/strong/em (or in this case sells it). strongemThis destroys a Nokia native advantage #39;in a war of ecosystems#39;/em/strong and instead brings Nokia ever more to the full control of Microsoft, as its slave.br / br / Before this action, Nokia could control how advertising might appear on Nokia branded smartphones. Nokia could sell advertising to its own smartphones. Now Nokia branded smartphones, when using the Microsoft Windows Phone OS, will be subject to Microsoft advertising concepts and spyware. Microsoft will also be selling the ads irrespective of Nokia#39;s own brand. Its quite feasible for Samsung or HTC to spam Nokia branded smartphones via the Windows Phone ad platform. Is this the sensible way to go?br / br / ONLY BECAUSE OF ELOPbr / br /This desperation move is purely due to mismanagement and mistakes by Elop. I am not claiming all was hunky dory at Nokia prior to Elop. I have written time and again, that Nokia was struggling in 2009 to 2010, and fired its CEO Kallasvuo, replacing him with Elop. I am not in any way suggesting that all was perfect at Nokia when Elop took over. But the first five months at Nokia, when Elop was in charge, saw the Nokia emstrongsmartphone unit sales grow /strong/emstrongly, emstrongNokia smartphone sales revenues grow /strong/emdramatically, and emstrongNokia profits at the smartphone unit jump/strong/em at a Nokia record level. emstrongNokia overall corporate profits grew/strong/em. In the first five months of Elop#39;s stewardship, emstrongNokia#39;s share price had grown by 11%/strong/em. I am not saying all was well, but Nokia had passed the worst part, and was on the road to better. Nokia was #39;on the mend#39;. And Elop was hired - as then Chairman of Nokia Jorma Ollila said when introducing Stephen Elop - span style=color: #c00000;emstrongElop was hired to fix Nokia problems in execution/strong/em/span.br / br / From February 2011 to today, Nokia has set a world record in destroying its market share. In smartphones Nokia#39;s market share fell from 29% in Q4 of 2010, to 12% of Q4 of 2011. Nokia very literally scared away six out of every ten customers it had a year ago. For the full year 2010, Nokia was twice as big as its nearest rival. By Q4 Nokia had shrunk to nearly half the size of its strongest rival, Apple#39;s iPhone. br / br / This carnage has all been a self-induced wound, and it started with the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfElop Effect/a, but Elop has added to the problems continuously ever since. Elop himself admitted the damage to Nokia market share took him by surprise and admitted later to more surprise that Nokia plunged from generating profits to generating losses. It did not surprise any real experts of the mobile industry, many of us said days after Elop announced his a href=http://communities-dominate.blogs.com/brands/2011/02/when-things-get-even-worse-than-you-thought-1st-preview-of-potential-for-nokia-microsoft-partnership.html target=_selfmad Microsoft strategy last February, that this would be the result/a, like I did a href=http://communities-dominate.blogs.com/brands/2011/02/when-things-get-even-worse-than-you-thought-1st-preview-of-potential-for-nokia-microsoft-partnership.html target=_selfon this blog, correctly forecasting that Nokia#39;s market share would crash to 12%/a by the end of the year, and Nokia#39;s strongly growing profits in its smartphone unit would reverse into loss-making, and the damage to all of Nokia would be so severe, that all of Nokia would generate a loss by the end of the year.br / br / Elop had a company that had growing sales, growing revenues, growing profits, and a growing share price - and turned that to losing sales, losing revenues, generating losses and a massively crashing share price (Nokia#39;s share price fell to less than half in the next five months). This damage is not only the world record crash of market share of any mobile phone handset maker. Its not only the biggest fall ever witnessed in any one year by a global brand leader in technology such as computers or home electronics etc. a href=http://communities-dominate.blogs.com/brands/2012/01/nokia-q4-results-now-official-elop-has-created-world-record-destruction-of-market-share-in-one-year.html target=_selfIt is literally the biggest fall of a global customer base, in any one year, of any company, in any industry - ever/a.br / br / And Elop did not see it coming, and did not manage his company wisely. That is all water under the bridge. Yes it was the a href=http://communities-dominate.blogs.com/brands/2012/01/nokia-q4-results-now-official-elop-has-created-world-record-destruction-of-market-share-in-one-year.html target=_selfbiggest management failure in the economic history of humankind/a, that we witnessed last year. Because of it, Nokia now is in deep trouble and has to try to sell assets just to remain alive. Elop has been trying to sell the NokiaSiemens Networking unit and is currently trying to sell the Vertu luxury phones unit. He has sold various Nokia assets from several sets of Nokia#39;s prime patents, to a whole handset factory in Romania. And a href=http://www.reuters.com/article/2012/01/27/us-nokia-advertising-idUSTRE80Q0ID20120127 target=_selfnow he sold Nokia#39;s advertising arm/a.br / br / I can understand that the CEO of a company that is massively generating losses (no matter what the cause) is now resorting to desperate moves such as firing tens of thousands of employees and selling assets. br / br / RATHER THAN SELL AD UNIT, WHY NOT ALLOW SALES OF N9br / br / What I cannot understand, is if Nokia is in the business of selling mobile phones, and its most profitable smartphones are currently on a href=http://communities-dominate.blogs.com/brands/2012/01/last-in-my-trilogy-of-nokia-numbers-postings-re-q4-the-regional-split-what-do-you-do-if-93-of-your-l.html target=_selfthe undersirable Lumia brand/a (where sales representatives at stores find that in 11 cases out of 12, a customer who buys a Nokia branded smarthpone refuses to take a Lumia) and the a href=http://communities-dominate.blogs.com/brands/2012/01/last-in-my-trilogy-of-nokia-numbers-postings-re-q4-the-regional-split-what-do-you-do-if-93-of-your-l.html target=_selfhighly desirable MeeGo platform/a (where sales representatives find that one in four customers who buys a Nokia smartphone, will buy an N9 which uses the MeeGo operating system) - why is Elop not willing to sell the N9 (and its sister phone the N950) in every market!br / br / Elop would rather sell Nokia assets, such as Nokia#39;s patent portfolio, its factories, its staff, and now, its mobile advertising unit - than allow the MeeGo based N9 (and its sister, the N950) to be sold worldwide!br / br / Elop#39;s priorities are wrong. He looks at global trends where the whole industry is in agreement - like now with mobile advertising. And he goes against it. emstrongHe finds a genuine Nokia asset where Nokia was years ahead of the rivals - like now with mobile advertising - and rather than fix that unit#39;s execution to deliver massive profits for Nokia, he prefers to sell it./strong/em Google just told us last year that Google makes 2.5 Billion dollars of advertising revenues out of its mobile advertising arm. Why doesn#39;t Elop fix this at Nokia, Nokia has a far wider reach in countries where mobile advertising is often the only mass market advertising medium.br / br / The decision to sell the mobile advertising unit at Nokia may have been necessary because Nokia is so badly generating a loss. span style=color: #c00000;emstrongThat loss is solely due to Elop#39;s mismanagement of Nokia last year/strong/em/span. Before February, Nokia#39;s profits were growing strongly. And Elop himself admitted he miscalculated how badly Nokia smartphone sales would collapse, and he also admitted surprise to the sudden massive losses that obviously resulted. The reason Nokia is now conducting a fire sale of its best assets is only due to incompetent management by its CEO, causing self-induced damage to Nokia, its products, its carrier relations, its customers and its brand. br /br /Nonetheless, to sell a mobile advertising unit for a major handset maker goes totally against the grain, where rivals are investing more in advertising, not less. And this is how Nokia#39;s CEO actions speak the opposite of his words. This selling of a key Nokia ecosystem component is how Nokia#39;s CEO communicates to his staff how his new management stops the competition from#0160;strongemquot;taking our market share with an entire ecosystem.quot;/em/strong#0160;This selling of the mobile advertising unit is how Nokia#39;s new CEO indicates emstrongquot;accountability and leadershipquot;/strong./em#0160;This sale of Nokia#39;s pioneering mobile ad unit is how the CEO rewards those parts of Nokia that did indeed strongemquot;deliver innovation fast enoughquot;/em/strong.#0160;br / br / The decision to sell the mobile advertising unit at Nokia was emstrongspan style=color: #c00000;certainly not to the best interests of Nokia/span/strong/em and Nokia#39;s ecosystem. But the decision to sell away Nokia#39;s own mobile advertising arm, and turn Nokia hostage to Microsoft#39;s advertising, is span style=color: #c00000;emstrongin the best interests of Microsoft./strong/em/spanbr / br / Nokia CEO Stephen Elop is once again acting in the best interests of Microsoft, and against the best interests of Nokia. emstrongHe is in breach of stock market regulations and clearly has span style=color: #c00000;acted with a confict of interest/span. His actions span style=color: #c00000;must be investigated as a breach of his fiduciary duty to Nokia shareholders/span. He must be fired for cause span style=color: #c00000;and any Nokia Board Members/span who do not support an immediate investigation of Elop shouldspan style=color: #c00000; be themselves investigated for collusion, neglect or incompetence./span/strong/em/p

pIn No Straight Lines there is an entire chapter devoted to all things mobile. It is called strongGutenberg is a moblogger: economic, organisational and societal transformation through mobile communications./strong/p pIt maybe that a certain Mr Ahonen - has much of this covered on the CDB blog./p pI explore mobile from the perspective of what it can do at an organisational and at a societal level./p pFrom the Achuar tribe in the Amazon rainforest using mobile and GPS enable digital technologies to challenge the Peruvian government and the mining companies trying to exploit their habitat and way of life to children using iPhones at school for learning in new exploratory ways - I make the point that mobile plays an important role in the evolution of every aspect of our society./p pSo NSL looks at education from Africa and India to the western world, it looks at how bricks and mortor organisations can become platforms and become part of a global economy, we look at how people living on $2 a day could be doubling their daily income by working on their mobile phones – we look at the politcal consequences of rapidly shared knowledge and information, we look at data and the impact on how commerce per se will evolve enabled by mobile. And we celebrate organisations like Ushahidi that are showing us the way in how innovation really works. In Japan we look at ground breaking business models that are already nearly 10 years old and we wonder why the fashion industry is not fully up to speed, nor indeed the media industries either./p pWhy? Because they fail to see what is right in front of them - they are stuck in an ambiguous world./p pI also argue that if organisations are not able to really design with mobile they could be missing a significant opportunity and this is NOT about apps./p pIt just might get you or your clients thinking differently about the future potential of our mobile society/p pa href=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330168e631134e970c-pi style=display: inline;img alt=NSL-logo-bw border=0 class=asset asset-image at-xid-6a00e0097e337c88330168e631134e970c src=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330168e631134e970c-800wi title=NSL-logo-bw //a/p pNo Straight Lines on a href=http://www.amazon.co.uk/No-Straight-Lines-ebook/dp/B006MHSTS0 target=_selfAmazon UK/a. a href=http://www.amazon.com/No-Straight-Lines-Alan-Moore/dp/0956766242 target=_selfAmazon US/a./p p#0160;/p fieldset class=zemanta-relatedlegend class=zemanta-related-titleRelated articles/legend ul class=zemanta-article-ul li class=zemanta-article-ul-lia href=http://www.no-straight-lines.com/blog/6-challenges-for-a-non-linear-world/6 challenges for a non-linear world/a (no-straight-lines.com)/li li class=zemanta-article-ul-lia href=http://www.no-straight-lines.com/blog/the-last-of-the-kodak-moments/The last of the Kodak moments/a (no-straight-lines.com)/li /ul /fieldset div class=zemanta-pixie style=margin-top: 10px; height: 15px;a class=zemanta-pixie-a href=http://www.zemanta.com/ title=Enhanced by Zemantaimg alt=Enhanced by Zemanta class=zemanta-pixie-img src=http://img.zemanta.com/zemified_e.png?x-id=65981b28-c783-41b3-baa8-4452a4e4fdba style=border: medium none; float: right; //a/div

pThis is the last of the trilogy of Nokia numbers postings related to the Q4 results. The first looked at a href=http://communities-dominate.blogs.com/brands/2012/01/nokia-q4-results-now-official-elop-has-created-world-record-destruction-of-market-share-in-one-year.html target=_selfthe overall market performance of Nokia smartphones (world-record crash/a). The second posting gave the best a href=http://communities-dominate.blogs.com/brands/2012/01/how-many-lumia-sales-as-nokia-and-microsoft-ashamed-to-reveal-number-lets-count-and-compare-to-n9-me.html target=_selfcalculations of how well Lumia and N9 sold/a, because Nokia CEO Stephen Elop is too much a coward, and emstrongashamed to reveal the numbers/strong/em. Now we dig into the numbers for one more look. How did the regional markets split, smartphones vs dumbphones. This will be interesting and we have some devastating news coming out of that analysis.br /br /For those who can#39;t bear to follow written explanations of mathematical calculations, here is the big picture. I calculated through a multi-dimensional optimization equation, what were the regional unit sales of smartphones (and dumbphones) based on the average sales prices. The accuracy is between 3% and 9% of any one region, so this is accurate to about +/- 100,000 units when Nokia total sales were in the many millions per region. Its not perfect, but it is VERY close. So if I said 3.2 million, the truth is most likely between 3.3 million and 3.1 million.br /br /Based on that (see below), I found that the European market for Nokia smartphones was 9.7 million smartphones in Q4. That gives Nokia a Europe-wide market share of 26%. That is not the relevant finding. Take that 9.7 million actual smartphone units sold. I calculated that the 7 countries where Lumia has been launched, have 63% of the European mobile phones and thus the population of the countries where Lumia launched, produced 6.1 million Nokia branded smartphone sales. In the a href=http://communities-dominate.blogs.com/brands/2012/01/how-many-lumia-sales-as-nokia-and-microsoft-ashamed-to-reveal-number-lets-count-and-compare-to-n9-me.html target=_selfprevious blog article/a, I calculated that in the 7 Lumia launch countries, a total of 466,000 units of Lumia have been sold in Q4 (this is the Europe part of the end-user sales, that is why it is less than 600K).#0160;br /br /Now it gets truly interesting. In those 7 countries where Nokia launched Lumia (and where the installed base of smartphone owners had a Nokia already in their pocket in 46% of the time) - only 26% were willing to buy a Nokia branded smartphone. Nokia lost more than four out of every ten existing loyal Nokia customers. But what of the customers who actually were happy enough to buy a Nokia branded smartphone.br /br /In the countries, where Lumia launched, in Nokia#39;s strongest market, where nearly half of consumers already have Nokia branded smartphones - when they walked into the store, and were shown Lumia smartphones - out of all European customers who ended up buying a Nokia smartphone in those countries where Lumia was available - emstrongonly 8% were willing to buy the Lumia/strong/em.br /br /Only 8% of smartphone buyers, in Nokia Lumia launch countries, who actually ended up buying a Nokia branded smartphone - were willing to take a Lumia. The marketing push was so loud, certainly every customer knew of, and saw Lumia marketing. Yet 92% of customers who actually bought a Nokia smarthone: refused a Lumia.br /br /span style=color: #c00000;emstrongDo not delude yourself. Lumia is a dead end. If 92% of your most loyal customers will refuse your newest and greatest flagship, and take an #39;obsolete#39; Symbian smartphone instead - the Lumia is a comprehensive failure and the fantasy of the Microsoft Windows Phone #39;third ecosystem#39; is utterly completely busted. /strong/em/spanbr /br /THE MATHbr /br /That was the big picture. I have more for you, if you are mathematically inclined. So first, the methodology. As we know the average sales prices of smartphones and dumbphones for Nokia (and as these are quite far apart from each other) and we have Nokia#39;s regional breakdowns of total handsets sold (smartphones + dumbphones) in units, and in revenues - we can calculate the #39;average sales price#39; per region easily. But with some multidimensional optimization we can actually model the actual unit sales of smartphones, and dumbphones, per region. I did it until I arrived at errors of less than 9% in every region - between 3% and 9%, and all errors in the same direction. So this is about an accuracy of +/- 3%. In practise, it means that the numbers I report here of unit sales of smartphones and dumbphones should not be off by more than 100,000 units, or 0.1 million.br /br /Do the math to double-check me, multiply each of the smartphone units by 140.2 Euros, and each of the dumbphone units by 32.4 Euros, and add all those together, you should find the smartphone sales total 2,748 (vs 2,747 as reported by Nokia) and for the dumbphones sales 3,042 (vs 3,040 as reported by Nokia). Very close. Add the totals across, smartphone revenues + dumbphone revenues per region, should come close to (but always a bit less) than what Nokia reported for that region. For example Europe region by my method gets 1.87 Billion Euros where Nokia reports 1.92 Billion. Its not perfect, but it is yes, close enough. Here is what I found:br /br /REGIONAL SALES NOKIA HANDSETS BY TYPE IN Q4 2011br /br /Europe . . . . 9.7 M Smartphones . . . 15.6 M dumbphonesbr /MEA . . . . . #0160;1.8 M Smartphones . . . 24.1 M dumbphonesbr /China . . . . . 4.5 M Smartphones . . . 10.2 M dumbphones#0160;br /APAC . . . . #0160;1.3 M Smartphones . . . 33.4 M dumbphonesbr /N Am . . . . . 0.3 M Smartphones . . . #0160; 0.2 M dumbphonesbr /LatAm . . . . #0160;2.0 M Smartphones . . . 10.4 M dumbphonesbr /TOTAL . . . .19.6 M Smartphones . . . 93.9 M dumbpohnesbr /br /I have then calculated the regional market shares based on the above and the rough number of 37 M smartphones per region China, Europe, North America and Rest of World. Thus Nokia smartphone market share for Q4 in the four regions was (roughly)br /br /Europe #0160;. . . . . . 26%br /China . . . . . . . #0160;12%br /N Am . . . . . . . #0160; #0160;1%br /Rest of World . . 14%br /br /There you go (you#39;re welcome, haha, I love this stuff, I do this anyway, but am happy that you followers and readers like this stuff too and that we now have a good way to share this kind of stuff)br /br /WHEN 92% OF YOUR CUSTOMERS REFUSE YOUR NEW PRODUCTbr /br /So, the above is very solid numbers and the errors are only modest. But as we start to parse those numbers further, we get to the problem of estimate, of an estimate, of an estimate, and even modest margins of errors can grow to be unmanageable. But we can study two markets where we have large enough regions to make further analysis. Lets start with Lumia.br /br /Lumia was launched in Europe, and as I said, 63% of the European subscriber base lived in those 7 countries where Lumia launched. Now when we take 63% of the European market for smartphones, we have a potential market size of 23.3 million smartphones. And obviously as Nokia sold 6.1 million smartphones in those countries, the European market share continues to be 26%.br /br /So about 46% of Europeans own Nokia smartphones currently. Europe is the oldest and most mature region for smartphones. European consumers have had smartphones the longest and the average European smartphone owner is on their 5th or 6th smartphone already. And this being Nokia#39;s #39;back yard#39; its no surprise Nokia had the lion#39;s share of the market. Out of those customers who now come to stores to buy a new smartphone (the smartphone buyer at Q4 in Europe typically was replacing an existing smartphone from about summer or autumn of 2010 with the current replacement cycle) who own a Nokia, only less than 6 out of 10 were willing to buy another Nokia. So under current Nokia branding and marketing and product portfolio, already in the store, more than 4 out of every 10 existing Nokia customers was churning away from the brand. For many of them, a Nokia using Symbian was the only smartphone brand they had ever used.br /br /Thats bad. We already lost 45% of the loyal customer base in the store. Now what about those who are convinced to yes, buy another Nokia. What about this cool new Lumia then? Aha. Out of all smartphone buyers, in those countries where Lumia had launched, who actually agreed to buy a Nokia smartphone - 92% refused a Lumia. In the face of the biggest marketing blitz in European smartphone history, with overpowering Lumia advertising and promotion - including those free Xbox gaming consoles at some operators for buying a Lumia 800 - still only 8% accepted a Lumia! Yes. 92% of loyal, Nokia-owning, European smartphone buyers, who actually DID buy a Nokia smartphone - ended up selecting one of those #39;obsolete#39; Symbian smartphones as described by Elop in his Burning Platforms memo a year ago. Yet European customers will prefer an obsolete Symbian smartphone over the brand-spaking-new cool 3rd ecosystem Windows Mobile Lumia smartphone by a ratio of more than 11 to 1 !!!!!br /br /Twelve customers pay money to buy a Nokia smartphone - not a dumbphone, a Nokia smartphone. All are offered a Lumia. emstrongEleven out of those 12 refuse the Lumia/strong/em and take an #39;obsolete#39; Symbian smartphone by Nokia instead.br /br /This Lumia is so dead its not even funny. I explained why it a href=http://communities-dominate.blogs.com/brands/2011/11/lumia-lumia-lumia-what-are-you-doing-nokia.html target=_selffails as a flagship phone/a on its design and features. I explained then a href=http://communities-dominate.blogs.com/brands/2012/01/the-real-top-14-reasons-why-nokia-lumia-and-windows-phone-will-fail-not-just-in-usa-but-across-plane.html target=_selfwhy it is failing based on actual consumer preference science in Europe/a. I know this stuff, I have written 12 books about mobile that are referenced in over 120 books by other authors! So it was pretty obvious and I knew that it would be bad. emstrongBut even I could not imagine it to be this bad/strong/em. So here is the evidence. 92% of new Nokia branded smartphone buyers in Europe in countries of Lumia launch, refused the Lumia. This horse is so dead I should not keep beating it anymore, haha..br /br /LETS COMPARE TO N8 ONE YEAR AGObr /br /Maybe this is #39;normal#39; for Nokia and Europe. Yeah, that sounds reasonable. Except that I did the same analysis for the N8 launch (more expensive at the time than the Lumia, with far less marketing support a year ago) and guess what. In Europe, 22% of European consumers who bought Nokia smartphones in Q4 of 2010, selected an N8. This is not a question of price, it is not a question of touch screen form factor or anything - the N8 won awards in Europe as phone of the year etc. No. The Europeans know what they like in a smartphone, and the Lumia 800 fails them. Don#39;t take my word. The tech writer at Guardian in Britain said he#39;s returning his Lumia. The Germany newsweekly Der Stern advised its readers to drive to Switzerland and buy the N9 with MeeGo instead of the Lumia. In Finland Tietoviikko is just now full of complaints about what all is wrong with the Lumia. Etc. This is a dead phone. Do not delude yourself, the Lumia (and Windows Phone) will never be a success. The sooner Nokia accepts the facts, the sooner Nokia can pursue some other path be that Android or MeeGo or whatever.br /br /WHAT ABOUT THE N9 NOW?br /br /So we have the numbers on the N9 at about 1.75 million units sold in Q4. Those are spread across five of the six Nokia regions and very splintered. We can calculate that the average market share of the N9 sold in all the countries where it had launched, was 3%. This is quite impressive as it is significantly more expensive on average than the Lumia pair, and sold in mostly countries of far lower income levels than the mostly very affluent European and Asian countries where Lumia launched. But still, it is an imperfect measure for sure.br /br /The only region where we have otherwise very solid numbers, that this can be used, is China. The N9 launched in China. And as it alone forms more than half of the total N9 launch country footprint, we can use the 3% as a reasonably accurate measure for the China market and do a similar analysis. For China Nokia smartphone market share, we obviously can use the whole China market. So out of about 37 million smartphones sold in China in Q4, Nokia sold 4.5 million units and achieved 12% market share. When we calculate 3% out of the China smartphone market of 37 million, we get 1.1 million units of N9 smartphones. How many is 1.1 million N9 MeeGo devices out of Nokia#39;s total China smartphone sales of 4.5 million? Yes. 24%br /br /So in China, where incomes are far lower than in Europe, and for the N9 which is more expensive than the Lumia phones, when a Chinese smartphone salesperson has gotten a customer to buy a Nokia, in one case out of every four, it is an N9 !!!!br /br /A year ago, Nokia#39;s genuine flagship smartphone, on Symbian, N8 achieved 22% of every Nokia sales in Europe. Now in China, Nokia#39;s current genuine flagship smartphone, the N9 on MeeGo achieves 24% of every Nokia smartphone sales in China. But the Lumia 800, the fake flagship, on Windows Phone, achieves only 8% of Nokia smartphone sales in Europe. What is wrong with this picture? Is it just me? Or is the mathematics not compelling.br /br /And don#39;t take it from me. Think only from the angle of the sales rep. These premium smartphones carry higher commissions of course. So. With the N8 a year ago, if a sales rep saw a customer walking into the store asking about Nokia, in more than one case out of five, the salesguy achieved a sale of the premium N8. Today, if a customer walks in, in an N9 country, and the customer asks for Nokia, in one case out of every four, the sales rep gets a sale of the N9! But in the Lumia countries, if a customer asks for a Nokia, the sales rep has to push the Lumia to 12 customers who all will buy Nokias, to find one willing to take the Lumia. This is an utterly lost cause. The sales reps are nothing if not money-driven, and they learn very soon what is futile sales. They learned in Europe already that the Lumia is a dead dog. They are learning it now in the early Asian markets and the US sales reps are shortly learning that on T-Mobile and ATamp;T as well. If you have to push the device to 12 promising customers and 11 of them refuse the model, but accept the brand, you very soon find out what other (Symbian OR MeeGo based Nokia branded) smartphones those customers would rather prefer. Salespeople are not stupid.br /br /11 OUT OF EVERY EVERY 12br /br /So moral of the story. emstrong11 people out of 12 who buy Nokia smartphones/strong/em in Lumia massive marketing launch countries, span style=color: #c00000;emstrongwill refuse the Lumia and pick another Nokia smartphone instead/strong/em/span. And don#39;t forget, we already lost 45% of those Nokia loyal customers who had the Nokia preference before. So if a customer walks into the store holding a Nokia phone, nearly half won#39;t buy a Nokia anyway (if the options are what Nokia now is offering).br /br /So the reality actually is, that out of any customer who currently owns Nokia and wants to buy a smartphone - and will probably look at a Nokia (and compare to iPhone, Samsung etc) the sales rep has to emstrongtake the time to push the Lumia at 21 existing Nokia customers to land one Lumia sale/strong/em. But Samsung and the iPhone were selling about 25% total market share - so half of the buyers of smartphones will be happy to buy either an iPhone or a Samsung. What do you think the sales rep will show when the customer mentions #39;Lumia#39;...br /br /(and Elop has to be fired, he is incompetent)#0160;/p

pNokia CEO is a coward to not give the exact count of Lumia sales in a href=http://communities-dominate.blogs.com/brands/2012/01/nokia-q4-results-now-official-elop-has-created-world-record-destruction-of-market-share-in-one-year.html target=_selfhis Q4 results/a, the launch quarter for Lumia. So lets do some math based on the available info, to count exactly how many it was.br /br /When Microsoft launched Windows Phone a year ago, Microsoft proudly told the world that they shipped 2 million Windows Phone smartphones by HTC, Samsung and others. They soon were spooked, however, when the sales dwindled and dried up and stopped giving the sales breakdown. By the Spring, Microsoft insisted all Windows Mobile smartphones be counted together with Windows Phone - even as these two platforms are incompatible. And still the sales of #39;the third ecosystem#39; kept falling, down to about 500,000 units by Q3. And early numbers from Q4 from Microsoft#39;s best market, the USA, reveal that even more than a year after its launch, Windows Phone sales are still severely lagging its older and obsolete cousin, achieving only 1.4% or about 520,000 units. Windows Mobile meanwhile refuses to die, and in the USA achieved 2.4% market share of new sales according to Nielsen or about 890,000 unit sales.br /br /Thus if you remember seeing a #39;Microsoft#39; market share in smartphones somewhere near 2% for Q3, that includes the better-selling Windows Mobile, and the newer and supposedly better so-called #39;third ecosystem; Windows Phone has far less than 1% market share globally.br /br /So with that context, the analysts#39; consensus estimate for Lumia launch quarter sales was 1.3 million units. We know that didn#39;t happen. Nokia would have proudly celebrated if it had at least matched the expectation, or exceeded it. I explained on this blog a href=http://communities-dominate.blogs.com/brands/2012/01/the-real-top-14-reasons-why-nokia-lumia-and-windows-phone-will-fail-not-just-in-usa-but-across-plane.html target=_selfwhy the real comparison target should have been 6.4 million/a for the first quarter of Lumia sales, and the minimum barely acceptable level was 4 million. But thats neither here nor there. Lets now see what we know, to try to get to the bottom of what Nokia is hiding.br /br /Nokia told us in the Q4 results published January 26, 2012, that Lumia sales #39;to date#39; had passed 1 million. We know its well below 1.3 million. And we know that it includes January sales with nearly a full month of sales of Lumia 710 in the five expansion markets (Hong Kong, India, Russia, Singapore and Taiwan) who only got the Lumia a few days before Christmas in mid December. Also the T-Mobile USA Lumia 710 was never sold in December. For these cheaper Lumia 710 unit sales, the vast majority of their sales will have come after Q4.br /br /The early Lumia markets of Europe that got the Lumia 800 (Austria, France, Germany, Italy, Netherlands, Spain and the UK) received their Lumias from November. As Christmas sales is a peak period, its fair to assume most Lumia sales in these markets did happen in Q4, not Q1.br /br /Lets measure the maximum potential market for the Lumia, based on market measurements. Kantar Worldpanel kindly gave us a summary statement about Lumia sales in Q4, saying that in every market that they follow, which includes most of the big European markets where Lumia had launched, a href=http://wmpoweruser.com/kantar-windows-phone-still-less-2-in-major-territories-but-may-hit-10-by-h2-2012/ target=_selfKantar found that Lumia did not exceed 2% in any single country/a.#0160;br /br /Kantar reported from September 2011 market shares (and looking also at September 2010) that in September 2011, in the five biggest European markets, Nokia#39;s market share in smartphones was 46.7% (as calculated on the basis of a weighted average per capita). So almost half of European consumers today will come to a store selling mobile phone handsets, with an existing Nokia smartphone in their pocket and would expect to replace it with the newest Nokia model.br /br /Remember that Nokia did not have a broad portfolio of new rival smartphones to offer as a rival to the Lumia in these countries. And when 47% of customers walk in asking for the newest Nokia, then try the Lumia, and only (less than) 2% walk out with one - it means Nokia has managed to disappoint 94% of its existing customer base! The emstrongLumia smartphones are so undesirable that more than nine out of ten currently Nokia-owning consumers will try it but reject it./strong/em#0160;(I a href=http://communities-dominate.blogs.com/brands/2012/01/the-real-top-14-reasons-why-nokia-lumia-and-windows-phone-will-fail-not-just-in-usa-but-across-plane.html target=_selfsaid this would happen/a, especially in Europe, especially with existing Nokia users, but even I could not imagine it would be this bad). That is total comprehensive market failure - even where Microsoft will toss in a free Xbox gaming console to try to entice sales. No wonder Apple#39;s iPhone and Samsung#39;s Galaxy have had a stellar quarter.br /br /These numbers are consistent with Nokia Q4 results (which do not break down the smartphone sales per region - I will do a calculation estimating that mix later on this blog). The overall Nokia handset sales declined 8% from the same quarter a year ago. But in Europe the handset sales (smartphones and dumbphones) declined 24%. Nokia in Europe is suffering far more than globally. And the most revealing number comes from handset revenues by region - which fell by 38%. So where Nokia was gaining revenues by sales of its premium smartphones like the Lumia and the N9, that was spectacularly not happening in Europe in Q4.br /br /LUMIA ESTIMATE Q4br /br /So lets take the European market. Kantar said no more than 2% in any market they measured. Lets forget about #39;less than#39; and use the highest number, lets say every European market achieved 2% Lumia sales. You can#39;t accuse me of trying to suppress the #39;success#39; haha..br /br /We have a convenient point in the global smartphone market to help us with this estimate. In Q3 China passed the USA as the single biggest smartphone country by volume. Europe has sold slightly more than the USA. When we add Canada to the USA to make a #39;North America#39; market, we get actually four almost exactly even sized markets for smartphones - Europe, North America, China, and Rest of World. The total global market for smartphones for Q4 was about 148 million units, so each of these four markets has an individual market size of about 37 million smartphones. Lets do some math!br /br /The 7 big European countries where Lumia 800 had launched in Q4 account for 63% of the subscribers. When we take 63% of the European 37 million market, we get 23.3 million for the countries where Lumia launched. Take 2% of that and we have 466,000 Lumia smartphone sales.br /br /Then the expansion countries where Lumia 710 launched in mid December are Hong Kong, India, Russia, Singapore and Taiwan. These countries account for 26% of the mobile phone subscribers of the #39;Rest of World#39; market so 26% of that 37 million gives us 192,000 smartphones. Except that Lumia had nearly two months of sales time in the first European markets, and only two weeks for these expansion countries, and only days before Christmas, it is definite that if Nokia Lumia can achieve 2% market success across those first 7 countries in about 2 months, it cannot even achieve half of that in only two weeks. But again, lets be generous to Nokia, and lets say that in these next five countries, Lumia achieved half the performance it did in the longer time in the first countries. So we cut the 192,000 in half, and thus Nokia sold 96,000 Lumia smartphones in the next five countries.br /br /We have a total Lumia sales estimate for Q4 of 2011, in 12 countries of Europe and Asia of 466,000 + 92,000 = 558,000 units. Then to add the sales to the stores (there will always be some units in inventory not yet sold) we can call it roughly 600,000 total sales of Lumia during Q4, when measured as Nokia sales. No wonder Elop didn#39;t want to mention the number. And yes, obviously, the Lumia sales account for 0.4% (not four percent, but zero point four percent) of all smartphones sold in Q4. Note we have to add other Windows Phone sales to that number and we#39;ll have about 1% total global market share for Windows Phone the so-called third ecosystem haha..br /br /LUMIA SALES EARLY PROJECTION Q1br /br /And then we can see that if Nokia did about 1.1 million Lumia sales #39;to date#39; - it would mean so far 500,000 more sales in January. Multiply that by 3 to get a full quarter, and we have 1,5 million sales. Add more growth or some more countries and in rough terms, expect Q2 sales for Lumia 800 and 710 to sell approx 2 million units in Q2. Pretty pathetic actually (especially if you are still holding your breath, that Nokia somehow matches that a href=http://communities-dominate.blogs.com/brands/2012/01/spin-and-sin-why-37-million-lumia-number-spells-disaster-for-nokia-but-not-for-microsoft.html target=_selfMorgan Stanley projection of 37 million Lumia sales this year/a haha).br /br /HOW COMPARES TO N9br /br /So Nokia did 600,000 Lumia sales in the most important new smartphone launch in Nokia history. The launch where all factors were totally in the control of the new CEO, without any limitations. He could decide what form factor the new phones would have, what countries to launch in, WHEN to launch the phones, when to ANNOUNCE the phones, when to demo the prototypes, who to receive samples to try them, etc. He had the biggest Nokia launch promotion budget ever, and that was then added to by literally several hundred million dollars of Microsoft marketing money to push the launch - inlcuding those famous free Xbox gaming consoles that you would receive if you bought Lumia 800s with some carriers/operators.br /br /The Lumia first launch countries were not only markets where Nokia was exceptionally strong (having like I said, 47% market share in the installed base ie return customers) - they also were some of the wealthiest nations not just in Europe (UK, Germany etc) but in Asia (Singapore, Hong Kong etc). And they achieved 600,000.br /br /How did this compare to Nokia#39;s N9, where Nokia only had one handset to sell (vs 2 with Lumia). Where Nokia had almost no meaningful marketing support, and selling in many countries of very modest income levels like in Europe Romania, Turkey, Hungary, Slovakia etc - and in the rest of the world such less wealthy nations as Russia, Brazil, Mexico, Vietnam, Bangladesh and Indonesia. br /br /Luckily I didn#39;t have to do the math for this, the nice people at a href=http://www.allaboutsymbian.com/news/item/14122_Nokia_Q4_2011-in_the_heart_of_.php#disqus_thread target=_selfAll About Symbian had tracked the numbers/a (read through the comments) and calculated the limits, finding N9 sales to be between the level of 1.5 million and 2.0 million units in Q4. Wow! Nokia specifically excluded all of its richest and biggest traditional markets where it tried to sell the Lumia, and these countries achieved - lets call it the average, 1.75 million unit sales of the N9 in Q4. So the one N9 outsold both Lumia handsets by almost exactly 3 to 1. And the average price of the two Lumia handsets is far less than the price of the N9. br /br /Obviously MeeGo on one handset alone, with no Nokia support, is outselling all Windows Phone smartphones by Samsung, HTC and Nokia, with the massive Microsoft marketing effort, globally, by about 2 to 1. MeeGo does this in its first quarter when it was not sold for the full quarter. This compared to Windows Phone that is well into its second year of sales. What is wrong with this picture? Did I just see the #39;Third Ecosystem#39; fall from 7th to 8th? Behind Android, Symbian, iOS, Blackberry, bada, Windows Mobile, and now even MeeGo? Why isn#39;t Elop and Ballmer calling it what it is. Windows Phone is the 8th bestselling ecosystem, ie it will never succeed.br /br /But lets go back to MeeGo. So you have cheaper smartphones, sold in the most affluent markets, with the biggest marketing support by Nokia ever, and with massive multi-hundred-million dollar marketing budget by Microsoft. And you get 600,000 unit sales for Lumia.br /br /Then you have the more expensive smartphone, sold in far poorer markets, with minimal Nokia support and visibility, and no partners to toss in dollars, and you sell 3 times more? What is wrong with this picture?br /br /WHY IS ELOP NOT FLOODING THE PLANET WITH MEEGObr /br /The total footprint of the countries where the N9 now sells, covers a smartphone market in Q4 of 59 million units of smartphones sold. And Nokia did 1.75 million sales in it. If Elop had bothered to launch the N9 in all markets, rather than 1.75 million unit sales, he would have achieved 4.4 million unit sales just using this one handset. But there is a second MeeGo smartphone also manufactured today, that Elop simply refuses to sell. Understand, Nokia currently has a second MeeGo superphone, that it has not just designed and tested and put into production. All the big costs are now done. And Nokia refuses to sell this second MeeGo device to any markets! It is the N950, the sister phone to the N9, the QWERTY variant of the N9, much like how the E7 was the sister to the N8 last year. The N950 would sell well in all markets. If we assume it only sold 50% of the level that the N9 is selling now, Nokia would have MeeGo sales of 6.6 million smartphones globally.br /br /Note, I set my target 6.4 million before we had this data. And if only Nokia release the N9 globally, rather than bizarre distant lands like Kazakhstan and New Zealand - and offered the sister phone N950 - even before any real strong Nokia support, the math suggests Nokia would have easily cleared the target I said what Nokia should be able to do today, when launching a new smartphone platform and device. Why Elop only managed 600,000 in Q4 - yes, only one TENTH of what any reasonable expectation would have been - says less about how bad Elop is as a manager, and more about how much the carriers and retail channel hate now Elop, Nokia as it currently is seen, and especially Microsoft, and Windows Phone.br /br /But yes, 6.6 million unit sales is what Nokia had in its hand for Q4 if any sane manager had been in charge. This is BEFORE we consider Elop#39;s personal support of MeeGo and any reasonable marketing support by Nokia, which would boost those sales considerably! Remember, the N9 already is being called superior to the iPhone 4S by some comparisons (the Lumia 800 and even Lumia 900 comes nowhere close to such comparisons). Remember the German newsmagazine Der Stern endorsement that was so glowing, they urged Germans to drive to Switzerland to buy an N9 rather than buying a Lumia 800 today.br /br /HOW MUCH MONEY#0160;br /br /The profit margin for the Nokia smartphone unit a year ago, when it was selling the N8, was 11%. As this was the flagship phone, a very conservative estimate is that the profit margin for the N8 was twice that, at 22% (probably far bigger at the time). If we use a 400 Euro price for the N9 and N950, and we assign 22% profit margin - provocativcely now - the total revenues that Elop is now abandoning out of not selling his MeeGo smartphones is ... 6.6M units minus 1.75M units = 4.85M units of abandoned sales to loyal Nokia customers who are yearning for a new Nokia flagship smartphone they can love. br /br /How much is that? 4.85 million MeeGo sales (N9 and N950) at 400 Euros per handset = 1.9 Billion Euros of revenues. Rather than Nokia reporting a 1.6 Billion Euro decline in sales revenues in Q4, with 2.7 Billion total revenues in the unit, Nokia#39;s CEO could have proudly reported an INCREASE of 300 million Euros above the revenues a year ago in smartphones and total revenues now of 4.6 Billion Euros.br /br /And profits? The extra 4.85 million MeeGo sales that Nokia had in its palm, but refused to take, would have generated at only 22% profit margin, additional profits to the smartphone unit of .. 426 million Euros !! So the smartphone unit, rather than reporting a loss of 190 million Euros, would have instead reported a profit of 236 million Euros !#0160;br /br /That not only would have been the biggest profit in the smartphone unit of any of the Nokia quarters in 2011, it would have even pulled the Nokia smartphone unit into the profit column for the full year 2011 !!!!br /br /What is wrong with Stephen Elop? How incompetent is he, to take a highly desirable product he has, and refuse to sell it broadly, now when it still is reasonably hot and in demand. This opportunity will vanish in only some months. He is a criminal for not selling the MeeGo handsets broadly now. He is acting against the best interests of Nokia (out of some mis-placed loyalty to Microsoft). Elop must be fired, now!#0160;br /br /PS - I have now added the a href=http://communities-dominate.blogs.com/brands/2012/01/last-in-my-trilogy-of-nokia-numbers-postings-re-q4-the-regional-split-what-do-you-do-if-93-of-your-l.html target=_selfregional split calculation and some stunning findings about Lumia and N9 customer acceptance/a.#0160;/p

pThe Nokia results are out and they are brutal. It ended up a href=http://communities-dominate.blogs.com/brands/2011/02/when-things-get-even-worse-than-you-thought-1st-preview-of-potential-for-nokia-microsoft-partnership.html target=_selfbeing almost exactly as I predicted back in February/a. Nokia smartphone market share has crashed to 12% from 29% exactly 12 months ago. As I said, Nokia#39;s smartphone unit went from generating growing profits, to generating increasing losses. And yes, just like I predicted, all of Nokia Corporation was pushed into loss-making. br /br /For 2010 Nokia sold twice as many smartphones as Apple, and by Q4 iPhone was outselling all Nokia smartphones almost exactly by two to one. emstrongThis is a historical moment. We have witnessed the establishment of a humiliating world record/strong/em. We have a new definition of colossal corporate incompetence. Mark this day. We can a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfnow evaluate the full effect of the Elop Effect/a.br /br /Here are the Q4 final numbers for the Bloodbath analysis. Nokia sold 19.6 million smartphones for the Quarter and 77.3 million for the full year. A year ago Nokia grew smartphone sales by 45%. Under Elop#39;s management, Nokia replaced the strong growth with a massive decline, dropping 25% when the industry itself had a massive year growing by over 60%.br /br /The market share exactly a year ago at Q4 was 29% and yes, Nokia was so dominant in smartphones, it was not just the biggest smartphone maker, it was literally more than twice as big as its nearest rival and obviously also bigger than its two nearest rivals combined. Nokia was not fighting its rivals like in most businesses where the top 2 players are close in size, like Coke and Pepsi, or like Toyota and General Motors, not like Boeing and Airbus etc. emstrongNokia was TOWERING over its rivals/strong/em. Literally, more than twice as big as its nearest rival, just 12 months ago!br /br /Since then we had the new CEO Elop on a Rampage of Ruin, starting with the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfElop Effect/a, where he combined the biggest management mistake ever of current product endorsements of the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfRatner Effect/a, with the biggest management mistake ever of future plans of the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfOsborne Effect/a. His Elop Effect alone has cost Nokia billions in revenues and profits. I calculated in December that the Elop Effect had already wiped out from Nokia Corporation revenues as big as those of the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selftotal revenues Oracle Corporation/a, and worse, the Elop Effect had a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfdestroyed profits as big as the total profits of Google!/a The equivalent damage was as if a whole RIM ie a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfBlackberry sized hole/a was cut out of Nokia, just due to the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfElop Effect/a.br /br /Then he continued feuding with his distributor channel, angering Nokia partners and frustrating Nokia supplier chain. The sales not just crashed for Q1 from 29% to 24% but due to Elop#39;s continued mismanagement, Nokia smartphone sales fell throughout the year, down further to 16% in Q2, then 14% in Q3 and now 12% in Q4.br /br /THIS IS A WORLD RECORD OF MISMANAGEMENTbr /br /This is not like New Coke. This is not like the BP Oil Spill. This is not like Toyota#39;s problem with brakes. There have been huge disasters in business in history, but nothing like what we witnessed in 2011. Never in the economic history of mankind has there been a global market leader brand, that collapsed so totally in one year. Nokia was growing 45% from 2009 to 2010 in smartphones. Nokia was successfully migrating its #39;dumbphone#39; customers to smartphones, by Q4 of 2010, Nokia had migrated 25% of its handset customers to smartphones while the world had only migrated 22%. All of Nokia#39;s rivals were far behind in that transition, Motorola so badly, they had lost 8 out of every 10 customers they tried to migrate from dumbphones to smartphones. And how did Elop snatch defeat from the jaws of victory? Today Nokia#39;s proportion of smartphones is down to 17% - while the industry has reached the point where 29% of all phones sold globally are smartphones!br /br /I cannot emphasize how strategically moronic this is. Previously, up to 2010, Nokia was GAINING customers, as it migrated its customer base from dumbphones to smartphones. The fact was, that Nokia was so successful in designing desirable phones - for Nokia existing customer preferences - that it actually gained customers while migrating them to more expensive smartphones. As long as Nokia was doing that profitably - and it was - that was perfection in executing a transition from a legacy business of dumbphones to smartphones. Elop has now reversed that. br /br /Now Nokia is on a Motorola trajectory, where Nokia customers are actually lost when shifting from dumbphones to smartphones - and alarmingly that rate has been increasing and is now at the rate of two lost for every one retained! Worst of all, now obviously Nokia is doing this generating huge losses in its smartphone unit. Really, readers. It is like Nokia looked at how Motorola collapsed, and Elop came in and said, lets do a Motorola for Nokia but lets just do it much faster. This is strategic: Elop not only destroyed Nokia#39;s today, Elop is also destroying Nokia#39;s tomorrow. And now Nokia is going against the global trend, where the world went from 21% of all new phone sales being smartphones in 2010 to 29% now. And Nokia is going against the grain, shredding its loyal customers as it peddles undesirable smartphones. Nokia#39;s customers are so disgusted - they are more willing to buy a cheap non-smartphone, than a smartphone!br /br /UNPRECEDENTED MARKET CARNAGEbr /br /In the past 12 months Nokia has shredded six out of every ten customers it had! This is comprehensive global collapse in the period of one year. emstrongNothing like this has happened anywhere, in any industry/strong/em. ANd look at past handset rivals. When Motorola collapsed, it achieved something like this, yes, but that happened over a three-year period, not in 12 months. When Palm died, it did it gracefully over a five-year period. Siemens did not collapse like this, nor did Microsoft#39;s Windows Mobile.br /br /From utter market dominance, literally bigger than its two biggest rivals combined, Elop exchanged 29% market share for 12% today. Both Apple and Samsung have already passed Nokia as bigger smartphone makers in Q2 and Q3. By Q4 Apple sold 37 million smatphones, which is a hair less than twice the number of smartphones sold by Nokia in the same period at 19.6 million. This has never ever happened before, in any industry, not in cars, not in TV sets, not in soft drinks, not in detergent, not in running shoes, not in airlines, nowhere! The dominant market leader collapsed in one year and has gone from more than twice the size of its nearest competitor, to about half the size of its strongest competitor. This is unprecedented market disaster!br /br /I warned this would happen and while there were many points in 2011 where Elop could have saved Nokia, he refused to budge. He admitted the sales crash was worse than he expected. His partner over at Microsoft Steve Ballmer has admitted Windows Phone has disappointed dramatically. The past GM of Windows Phone who left Microsoft has admitted that carriers hate Microsoft#39;s mobile activities and in 2011 Microsoft has only made matters worse. Now we have seen how badly Nokia has done with its Lumia strategy.br /br /Note, one year ago at this time, when Elop had been in charge for about five months, Nokia shareholders had appreciated Elop#39;s leadership and the strong performance in the smartphone unit so well, that the Nokia share price had grown by 11%. Since the Elop Effect, Nokia share price had fallen by more than half. Nokia#39;s shares were rated one notch below perfect at this time last year. Since then all three ratings agencies issued a series of downgrades and Nokia is now rated junk. Nokia#39;s brand was consistently one of the 10 most valuable brands on the planet. Elop#39;s actions dropped the Nokia brand out of the Top 10 for the first time ever.br /br /I am not suggesting that somehow Nokia was perfect - the previous management under Olli-Pekka Kallasvuo had damaged Nokia well from its peak value years ago. But that damage had been reversed, Nokia was strongly in recovery mode by Q4 of 2010. I am not attempting in the least to suggest Symbian was going to somehow save Nokia, the decision was taken long before Elop came along, that Symbian woiuld be replaced - and I had written on this blog many times why that was the right thing to do. Nokia#39;s problems were with execution, not its smartphone strategy. I wrote for example a href=http://communities-dominate.blogs.com/brands/2011/01/return-of-the-jedi-nokia-can-be-saved-here-is-the-how.html target=_selfthis a year ago, about Nokia problems in execution and marketing/a. Elop was hired to fix execution problems, not to destroy its smartphone unit, as Chairman Jorma Ollila clearly stated when Elop was announced in early Autumn 2010.#0160;br /br /As Nokia was plunged into generating big losses last year, Elop has been since selling various Nokia assets to try to keep the company afloat. He has tried to sell the NSN unit and currently is trying to sell the Vertu luxury phone unit. He has already sold several batches of patents, and just sold Nokia#39;s handset factories in Romania. He also has been firing staff, more than 10,000 were let go already, and we just heard another 13,000 will be fired next. This guy is destroying Nokia as we knew it.br /br /COMPARE THEN AND NOWbr /br /One year ago, exactly this time Q4 results, this was Nokia smartphones, compared to today:br /br /ITEM . . . . . . . . . . . . . . Q4 2010 . . . . . . . . Q4 2011br /br /Smartphone unit sales . . 28.6 M . . . . . . . . . 19.7 Mbr /Unit growth YoY . . . . . . 45% . . . . . . . . . . . minus 31%br /Average Sales Price . . . 154 Euro . . . . . . . . 140 Eurobr /Smartphone Revenues . . 4.4 B Euro . . . . . . 2.7 B Eurobr /Smartphone profits . . . . 510 M Euro . . . . . . minus 190 M Eurobr /Market Share . . . . . . . . 29% . . . . . . . . . . . 12%br /Smartphone migration . . 25% . . . . . . . . . . . 17%#0160;br /br /If you thought RIM was having trouble, it is nothing compared to this.span style=color: #c00000;emstrong In every way Nokia has seen an epic collapse and please understand, there is no bigger story in mobile, this is a WORLD RECORD in market collapse/strong/em/span. Please also remember the a href=http://www.asymco.com/2011/06/02/does-the-phone-market-forgive-failure/ target=_selfrecent analysis by Horace Dediu at Asymco blog/a, that in mobile, once your handset maker degenerates from profit-making into loss-making, there is no recovery. The history is clear about that from Siemens to Ericsson to Palm to Motorola. Not only that, we also see that Nokia#39;s corporate loss of 1.1B Euros (about 1.4B US dollars) was actually 250 million dollars bigger in its operations - yes, a href=http://blogs.computerworld.com/19643/microsoft_paid_nokia_250_million_in_fourth_quarter_to_adopt_windows_phone_7_billions_more_to_follow target=_selfthe Q4 period included a 250 million cash payment from Microsoft/a to try to prop up CEO Stephen Elop and his mad Microsoft strategy. Yes, Nokia#39;s losses in reality based on its actual market performance are far worse. And that loss goes to the smartphones unit which in reality generated nearly a 400 million Euro loss if this Microsoft cash injection is removed. And then, yes, the Microsoft #39;strategy#39; - can it save Nokia? No.br /br /LUMIA IS A FAILUREbr /br /Nokia refuses to give actual Lumia sales numbers. So does Microsoft. We can see from that, that emstrongboth companies are ashamed about the lack of traction and fear reporting the number/strong/em. Note, a year ago Microsoft proudly published its 2 million figure. Since then Microsoft has admitted that Windows Phone sales have declined from quarter to quarter. Now we know that #39;to date#39; by January 26, Nokia#39;s Lumia has sold #39;well over 1 million Lumia devices to date#39;. That more than 1 million was achieved in the three months from November to end-of-January. The Q4 sales will be significantly below 1 million, and analysis of the Nokia launch markets for Lumia sugggest about 600,000 total Lumia sales in Q4. That compares to an equivalent launch of Nokia#39;s then-new operating system, the S^3 release of Symbian, which sold 4 million units in Q4. When adjusted for the market growth in 2011, that would mean 6.4 million sales now. But under Elop#39;s management his Microsoft Madness strategy has yielded a success rate of one TENTH of what Nokia did a year ago with the #39;obsolete#39; Symbian and the then-flagship smartphone N8.br /br /Note Nokia refuses to give us a sales number for N9 sales using the MeeGo OS. That means MeeGo has outsold Lumia. And we have an independent analysis which says MeeGo sold 1.4 million units in Q4. This is particularly relevant, as the MeeGo countries of N9 launch were selected to be very tiny smartphone markets like New Zealand, Singapore, Norway, Nigeria and Kazakhstan. I will do my analysis of what is the equivalent performance of the MeeGo platform vs Lumia phones by Nokia, in a separate blog shortly. It is disappointing to find that Elop refuses to celebrate the huge success that the N9 has been in horrid conditions and with no top management support.br /br /WINDOWS PHONE WILL NOT SAVE NOKIAbr /br /First of all, I have of course given my a href=http://communities-dominate.blogs.com/brands/2011/11/lumia-lumia-lumia-what-are-you-doing-nokia.html target=_selfreview of the first Lumia smartphone and why it will fail as a flagship phone/a, whether Nokia intended it as such or not. Then I gave a a href=http://communities-dominate.blogs.com/brands/2012/01/the-real-top-14-reasons-why-nokia-lumia-and-windows-phone-will-fail-not-just-in-usa-but-across-plane.html target=_selfdetailed analysis of where and why Lumia is failing in the market/a once we had market data. I have given my forecasts of what the years 2012 and 2013 will look like for Nokia and Lumia. And of course, I will revisit those forecasts and give you my latest revised picture based on these latest Nokia numbers. But lets not use my numbers. We have seen now two forecasts for Nokia Lumia success potential, by Morgan Stanley and iSupply. Lets see how plausible these are and what they tell us.br /br /The a href=http://www.xbitlabs.com/news/mobile/display/20120112092818_Nokia_Projected_to_Sell_37_Million_Windows_Phone_Smartphones_in_2012_Morgan_Stanley.html target=_selfMorgan Stanley forecast/a is the one you may have seen promising 37 million Lumia sales this year. The iSupply forecast is the one that promised Windows Phone to pass the iPhone by 2015 and achieve 17% market share. Lets examine briefly these two forecasts.br /br /MORGAN STANLEY SUGGESTS LUMIA ONLY 7% BY END OF 2013br /br /The Morgan Stanley forecast from January 2012, said Nokia Lumia sales would hit 37 million this year 2012 and 64 million in 2013. They add also Symbian sales so total Nokia smartphone sales would be 77 million in 2012 and 80 million in 2013. Note - first of all, that Morgan Stanley clearly expect that somehow Nokia can stem the decline in smartphone sales last year (of 23%) this year to be flat sales this year, and a slight growth of 5% next year for all Nokia branded smartphones. Secondly, Morgan Stanley expects that Nokia can still sell 40 million Symbian smartphones this year 2012 and 16 million next year. I think these are very rosy expectations (especially, now in light of Nokia Q4 results, when Elop clearly said he no longer expects Symbian to sell those promised 150 million more units he committed to last February) but lets assume Morgan Stanley#39;s forecast is close to accurate. What do these numbers mean?br /br /Morgan Stanley#39;s forecast of 37 million Lumia sales in 2012 means 5% market share this year and the 64 million Lumia sales for 2013 suggests 7% market share by next year! This is success? I fear not. What when we add in Symbian sales. Morgan Stanley#39;s projection suggests Nokia total smartphone sales this year 2012 would see a further drop in market share to 11% this year and down to 8% in 2013. If you think Nokia who dominated smartphones last year, would have 8% next year, and thus according to this optimistic forecast, emstrongNokia would have expelled three out of ever four customers it ever had/strong/em - that is the very definition of corporate suicide. (and I think this Morgan Stanley projection is too rosy)br /br /iSUPPLY EVEN BASE NUMBERS ARE WRONGbr /br /Lets turn to iSupply. Just now in January, a href=http://www.isuppli.com/Mobile-and-Wireless-Communications/News/Pages/Lumia-900-Introduction-to-Trigger-Smartphone-Renaissance-for-Nokia-and-Microsoft.aspx target=_selfIHS iSupply gives the projection for Windows Phone sales/a (remember, not only Nokia provides WP7 smartphones, also Samsung and HTC offer a token few smartphones in that space but both obviously give preference to Android). They project Windows Phone to have 1.9% in 2011, then 9.0% in 2012, then 15.3% in 2013, 16.1% in 2014 and 16.7% in 2015. They do not separate Symbian sales out of the numbers, but just to see how implausible these numbers are, lets look at the other 2011 numbers. iSupply has estimated the iPhone to be the #39;loser#39; to Windows Phone. They start with iPhone to have 18.0% in 2011. The reality is, that Apple achieved 20% market share in 2011. So the difference in iSupply#39;s forecast in 2015 is literally one tenth of one percent between iPhone and Windows Phone, but iSupply starts by punishing Apple by 2 full percentage points! Then the growth? Apple grew 2 points in 2011 and currently in Q4 with the new iPhone 4S, Apple is selling 25% of all smartphones globally! Meanwhile iSupply felt that that Apple would be flat in 2012? That is perhaps a fair projection if iSupply thought that Apple#39;s sales were flat in 2011, but Apple grew 2 points. Why would the iPhone then fall in 2012?br /br /But look at iSupply#39;s number for Windows Phone in 2012, this year. Last year all Microsoft partners sold about 5-6 million smartphones in total (remember, MIcrosoft itself was so afraid to give the number they started to count both the new Windows Phone sales with the older and incompatible Windows Mobile sales last year - and still in Q4, Windows Mobile was outselling Windows Phone in Microsoft#39;s best market, the USA, as we found from Nielsen Q4 new sales measurements). Now lets say it was 6 million in 2011. Then suddenly iSupply feels that this year 2012, that will suddenly explode to 63 million? emstrongTEN FOLD INCREASE IN ONE YEAR?/strong/em On what planet? The only manufacturer who will focus on Windows Phone will be Nokia and Morgan Stanley in their optimistic view only counted about half that number for Nokia Lumia sales. emstrongAndroid did not explode 10-fold in the third year of its sales. Apple#39;s iPhone did not explode 10-fold sales in its third year. There is no precedent for this outrageous forecast./strong/em And even if it were to be true, EVEN if it were to be true, then by the end of 2015, four full years from now, the total Windows Phone family of handset makers would have achieved selling one out of every six phones worldwide, and Nokia would have some slice of that pie. A year ago Nokia alone was selling one out of every three smartphones sold globally. #0160;#0160;/p pWe have seen that Nokia#39;s biggest smartphone launch ever, with the biggest market support, with the biggest artificial creation of demand, as Nokia#39;s Symbian based phones were almost extinct from handset stores; with the biggest marketing expenditure Nokia had ever done for smartphones; combined with hundreds of millions of more marketing support from Microsoft#39;s deep pockets - to the degree that in the UK for example consumers got free Xbox videogaming consoles if they bought a Nokia Lumia 800 smartphone - yet the sales in Q4 were well below one million (and likely about 600,000). Kantar measured Q4 sales for Lumia and in no major market did Lumia pass even 2% sales of smartphones - these were Nokia#39;s best markets where Nokia#39;s market share a year ago was between 35% and 60%. Now the Lumia sales have failed to succeed, to the point that Nokia is already slashing prices to sustain what sales remain. Do not delude yourself, Lumia cannot save Nokia.br /br /I will return with more Nokia analysis but these Q4 results are devastating. We did witness a world record in corporate management. Nokia#39;s CEO Stephen Elop took the world#39;s strongest smartphone maker brand and ruined it in one year. He replaced strongly growing sales and 29% market share with 12% today, projected to hit 8% next year. He took strongly growing revenues and profits, and replaced them with declining revenues and big losses. Most of all, he managed to reverse the trend of migrating Nokia customers from low-cost dumbphones to smartphones - now Nokia is literally bleeding customers when they come to replace a phone, for the first time ever, Nokia#39;s market share in smartphones is worse than in dumbhones - and worse than the global migration to smartphones. Last year one quarter of Nokia#39;s customer base had been migrated to smartphones, where the future of the mobile phone business exists. Today Elop has scared those customers away, and only one in six customers of Nokia phones select smartphones. He will be studied in MBA courses as the case study of the greatest management failure of all time, and no doubt, many will arrive at the same nickname as I use for Stephen Elop: he is the Microsoft Muppet. The Nokia Board must fire him immediately before he ruins what is left of Nokia.br /br /PS - I have now added the a href=http://communities-dominate.blogs.com/brands/2012/01/how-many-lumia-sales-as-nokia-and-microsoft-ashamed-to-reveal-number-lets-count-and-compare-to-n9-me.html target=_selfcalculation of Lumia sales for Q4/a (600,000 units) - compare it to N9 MeeGo sales of 1.75 Million - both launched in the same quarter and you can sense my frustration with Elop.#0160;br /br /PS PS - I now added also the a href=http://communities-dominate.blogs.com/brands/2012/01/last-in-my-trilogy-of-nokia-numbers-postings-re-q4-the-regional-split-what-do-you-do-if-93-of-your-l.html target=_selfregional split calculation/a with some stunning customer acceptance findings. But read the Lumia sales blog first (the above link)#0160;/p

pIn Bloodbath news we expected a great quarter by Apple but the iPhone has simply blown everyone away including just about all analysts. Apple reported 37M unit sales of iPhones. This is up 116% from Q3 more than doubling sales in just 3 months. The unit sales are up 130% from a year ago. iPhone market share has hit about 25% for Q4 (obviously we don#39;t know exact market share until all companies have reported and we have a full market size, but that is pretty surely within one percentage point either way). This is up from 15% market share three months ago. Wow. Wow-wow-wow. Apple has had a humongous quarter.br /br /And for the full year? The iPhone hit 93.1M units sold. That number means a preliminary market share of 20% for the full year 2011. Very very good for Apple, congratulations! All this while selling the most expensive line of smartphones in the world, and making by far the biggest profits of the industry. Clear perfect quarter for Apple, total perfection. br /br /In the Bloodbath battle it was already certain that Apple was the finalist for top honors both for the Quarter and the full Year title. Nokia was out of it, the only contender the iPhone now faces is the series of smartphones from Samsung. We now know the numbers. Samsung would need to do 37.1M units of sales in Q4 obviously to pass Apple and retain its title as the biggest smartphone seller for the quarter - a tall order, Samsung grew by 40% from Q2 to Q3. Now in light of this massive iPhone 4S quarter, Samsung would have had to increase its growth rate to 48% to achieve that level. And for the full year, the magic number is 37.7M for Samsung, any number lower than that, and Apple will get the annual crown as the first company ever with a name other than Nokia, to be crowned as the biggest smartphone maker in the world. Samsung numbers will come out in a week so now we wait.br /br /PS that argument I made in 2010 that iPhone sales in market share had peaked on an annual level? Obviously I was found wrong this time last year as the iPhone did grow one percent in market share. But just like I wrote with the analysis of the Nokia collapse, that helped Apple resume strong growth and we have seen it now. Much of this growth for Apple in 2011 was due to the voluntary collapse of its strongest global competitor who just in 2010 sold more than twice as many smartphones as Apple in total. But don#39;t take this as Tomi sour grapes about Apple. Apple had to take advantage of the Nokia collapse opportunity. Some of the rivals in smartphones managed that - like Samsung and Apple - others utterly failed to do that like Blackberry and Motorola. So this is also congratulations for Apple for being nimble enough to be able to capitalize when the biggest company in the industry suddenly stumbles and loses more than half of its market in less than a year.br /br /One more note about Apple and Q1 (calendar quarter ie Januar-March quarter). Apple has established a good China quarter pattern after Christmas sales. It surprised every analyst in 2010 (including me) and in 2011 it still caught out many who reviewed Apple. The pattern for most industries is that after-Christmas sales in Q1 fall from the peak in Q4. With Apple having strong China sales, especially with the iPhone, Apple has produced slight growth from Q4 to Q1, so be prepared for that. However, this year 2012 we have two factors that may suppress the iPhone number for Q1 - first, the Chinese New Year came really early this year on 23rd January (ie the Gift-giving season, sometimes Chinese New Year comes well into February). Secondly, the iPhone 4S was not released for China until early January, and then it had that famous disaster in sales in its flagship stores, which closed for several days due to the riots. So Apple had less time to sell the 4S and even out of that, Apple kept some of its stores closed. We might see a slight dip in iPhone sales for Q1 rather than the usual growth from Q4./p

pAlan wrote a great blog article here about Kodak last week (and its so delightful to come to the CDB blog and find a new article by Alan, isn#39;t it? I always learn so much). His story was about the big picture disruption in the world economy and showed where a classic giant global corporation and brand like Kodak might die in the disruption but another giant global corporation and brand like Lego might survive. An excellent article about disruption.br /br /In the article Alan quoted Om Malik who then mentioned Nokia vs Apple amp; Google in smartphones. I see a lot of that from mostly USA based writers. We also have some debate in the comments here on this blog. So let me make this observation about the Kodak death how it applies to mobile, where the right analogy is and why Nokia is not the right analogy. Similarly, where is the right analogy for Nokia now.br /br /So Kodak was the world#39;s biggest camera manufacturer at one point in time and for almost its whole existence, the Kodak corporation was the world#39;s largest camera film manufacturer. Kodak actually invented the digital camera, which we now all know, has cannibalized more than 95% of the planet#39;s photography business. And most of those digital cameras are now on mobile phones, ie cameraphones, no longer on stand-alone digital cameras although they too are still selling in large numbers. Film based cameras are a very tiny niche industry now, for the professionals and semi-professionals and some other industries like the movies and some medical instruments (X-ray machines) etc.br /br /The point is, that Kodak was the world#39;s biggest camera and photography company at one point in time. That industry has shifted almost totally to a new technology not compatible with film, and it is called digital photograpy. And Kodak actually invented that digital camera. Why isn#39;t Kodak today the world#39;s biggest digital camera maker or even one of the big camera or photography brands. Because Kodak did not pursue its invention and only made a very token attempt at digital cameras. So the issue here is that the shift in the camera industry was invented by Kodak but it did not significantly attempt to capitalize on it.br /br /KODAK ANALOGY IS NOT NOKIA IN PHONESbr /br /The analogy Om Malik makes is about smartphones. That is not a valid analogy. Yes, just like Kodak invented the digital camera, so too Nokia invented the smartphone. But unlike Kodak, Nokia had pursued rigirously a shift in its handset prodcution from dumbpohnes to smartphones. Of all the mobile phone handset makers in existence when the smartphone was invented by Nokia, its major rivals all had to embrace this shift as well, into smartphones. It is not valid to compare Nokia#39;s journey to someone who is new who only makes smarpthones (like Apple) or who only makes the software part of smartphones (like Google). That is not the correct analogy to Kodak. Kodak#39;s migration to the digital camera world is correctly compared to Nikon and Canon and Polaroid and Minolta and Carl Zeiss and Vivitar and Takumar etc. The incorrect comparison is to compare Kodak to those companies that never made cameras before the invention of the digital camera like Sony or Samsung or Apple or Nokia etc.#0160;br /br /And of Nokia#39;s biggest rivals in the dumbphone industry a decade ago, most of the big makers did not survive the transition. Motorola? Gone. Siemens? Sold its handsets unit. Ericsson? Tried partnering with Sony but quit that attempt just a few months ago. The only Big 5 handset maker from 2001 in the world who is still alive and now making smartphones, apart from Nokia, is Samsung.br /br /Apple did many things in mobile and disrupted the world utterly, but Apple did not kill Nokia in smartphones. A year ago, Nokia was massively bigger than Apple in smartphones, massively. Nokia only in smartphones, was not only bigger than Apple, it was bigger than Apple and Samsung smartphones - combined. And Nokia#39;s smartphone sales - contrary to myth - was growing strongly in 2010 - by 45% from the year before - and Nokia#39;s diminshing profits in its handset unit, had been turned back into strong growth of profits by year-end. Nokia was not anywhere near its death-bed due to the smartphone revolution, nor because of Apple. And as to Google, yes, the Android OS did catch up to Symbian by the Spring of 2011 and is today bigger, but again, Symbian didn#39;t die due to Android. Symbian was still growing (again by 45%) in 2010. Not growing as fast as the industry, so Symbian was losing some market share, but Symbian was nowhere near any threat of extinction.br /br /No. Nokia did not die (or start to die) because of Apple and Google. Nokia#39;s strong growth turned into catastrophic collapse of sales on February 11, 2011, when CEO Stephen Elop torpedoed Nokia#39;s brand and sales and future. Kodak died because it did not capitalize on the invention. Nokia pursued its invention rigorously and remarkably successfully - remember, Nokia was bigger than Apple and Samsung smarthpones combined! That is not failure.#0160;br /br /KODAK ANALOGY IN PHONES IS MOTOROLAbr /br /No. Nokia analogy is something different. But before we go to that, let me show you the true Kodak analogy in mobile phone handsets. This will make you cry. Its Motorola. So in mobile phones (cellular phones) we have seen two full generations and the birth of the third. The first generation ie 1G cellular phones were on an analog technology basis launched first in Japan in 1979. The second generation ie 2G was digital and was launched in Finland in 1991.. The third generation 3G networks were launched in Japan in 2001; Motorola invented the portable cellular phone handset (while it did not launch the mobile industry, earlier mobile phones on cellular networks were carphones and briefcase phones). But Motorola did invent the digital wireless communications.br /br /You didn#39;t know that? Yes, Motorola had a very large part of its early business from the military. The original #39;walkie talkie#39; military portable radios that the US army and marines used in World War 2, were made by Motorola. And then Motorola continued to provide ever more sophisticated and portable communciation gear for the military. They then found that wireless communciation was being spied on, so they came up with a way to disguise radio communication and make it undetectable, and safe from decyphering. They did it with a technology called CDMA. That is yes on the basis of the 3G technology we use in our #39;UMTS#39; or WCDMA based GSM-compatible 3G smartphones used in all countries; as well as on the CDMA based 2G dumbphones and 3G smartphones used in the USA, Canada and some parts of Asia and Latin America. br /br /So Motorola was truly inventing digital wireless communication technology, well before consumers were using mobile phones even on the 1G standards. This is VERY much like Kodak#39;s invention of the digital camera. Motorola did produce digital radio gear for various armies of the world, and later that military technology was adapted for civilian use. Here is where Motorola lost the plot. It was Nokia who launched the world#39;s first digital cellular phones, while being a tiny rival to Motorola. Motorola had invented the technology (in another unit) and didn#39;t rush to bring it to mobile phones. Then, like Kodak, Motorola saw its rivals deploying this technology and was very late to get onboard.br /br /In 1997 Motorola was by far the world#39;s biggest mobile phone maker, and most of its phones were analog 1G phones. Nokia was rising on digital mobile phones. By 1998 Nokia passed Motorola. By 2006 Samsung had passed Motorola. By 2008 LG had passed Motorola. By 2010 Motorola was so bankrupt, it sold its networking unit to Nokia, and the rest of Motorola was split in two. Its handset unit tried to fight it alone, and continued generating losses, and was bought by Google last year. Motorola is the analogy to Kodak, in that it invented the new technology, but did not pursue it rigorously from early on, and when it finally did, it was too little and too late, and excepting for a last heroic hurrah with the Razr, MotoMoto is gone.br /br /NOKIA ANALOGY IS IBMbr /br /The nearest tech analogy for what Nokia actually did in smartphones, is IBM. This is not a perfect analogy, but let me make it as close as possible. IBM once towered over its rivals as a computer maker, so much that in the 1970s and early 1980s the computer industry was called IBM and the BUNCH - with Burroughs, Univac, NCR, Control Data and Honeywell all essentially the five dwarfs on the feet of the global giant IBM and this is like Nokia was in the mid 2000s towering over its rivals as big as the next 4 biggest rivals combined (in terms of units of mobile phone handsets sold per year).#0160;br /br /Like IBM, also Nokia made both its mobile phone handsets and the software for it, both in dumbphones and smartphones. Same for IBM mainframes. Then came the PC. IBM didn#39;t invent the PC and early PCs were seen by IBM management as toys not fit for proper business use. Apple came along and sold more actual computer units than IBM which shook the company (this was Apple 2, long before there was a Mac) and IBM decided they should get into the PC market. They created the IBM PC which was introduced with iconic advertising using an actor portraying the Charlie Chaplin character of the tramp. What IBM did however, was to still dismiss the relevance of the PC so much, that they didn#39;t bother to develop their own OS software for the PC, they outsourced that to Bill Gates#39;s little start-up company called Microsoft.#0160;br /br /I know the analogy to Nokia is not strong here, Nokia invented the smartphone but at least one could say that the early Symbian OS development was not done in-house by Nokia, Symbian was set up as a separate entity co-owned by the major handset maker rivals like Motorola, Sony, Ericsson, Panasonic, Samsung, Siemens etc - with Nokia only one of the shareholders.br /br /But yes, to my analogy. IBM did use the PC to become the world#39;s largest PC maker and passing Apple to take back the title as the world#39;s largest computer manufacturer when measured by units sold. Then came the Apple disruption - the Macintosh PC, with its radical mouse and graphical user interface (what we think of as Windows style PCs today) and all its user-friendly innovations like displays that showed what the finished printouts would look like, and hypertext links (what enabled the WorldWide Web half a decade later) etc. br /br /Microsoft was powering all IBM personal computers at the time. Microsoft set on to build a rival to the Macintosh OS, what became Windows. IBM could have remained with the Microsoft OS version - which was the world#39;s bestselling OS platform both on DOS and Windows, the Mac never passed either in scale. But IBM departed from the leading Microsoft platform, suddenly, and decided to develop its own rival to the Mac, called OS/2. IBM had been on the world#39;s bestselling OS platfrom for PCs while it was the world#39;s bestselling PC brand. Then it decided to abandon that platform, and try to create a new rival inhouse.br /br /Now look at Nokia. Nokia#39;s Symbian platform was still in Q4 of 2010 the world#39;s bestselling smartphone OS according to all analyst houses but one (and that one was ridiculed by the industry for an obvious blatant mathematical error). Nokia decided to abandon the world#39;s leading OS platform, and replace it with the smallest of the seven in production at the time in February 2011, Microsoft#39;s Windows Phone.br /br /Since that decision was made, Nokia has so far lost half of its market in half a year (we will see how much worse the damage is in a few days when Nokia Q4 results are released). This is a world record collapse of global market share in any industry ever. Now Nokia#39;s path looks very similar to how IBM suffered with OS/2. They struggled for several years attempting to sell premium IBM PCs using OS/2, and found their market share in terminal decline - until they abandoned OS/2 and shifted back to the Microsoft world which now was obviously Windows. The journey was so costly, IBM would later see its PC business become so unprofitable it was sold to Lenovo.br /br /Like I said, this is not a perfect analogy, but this is the nearest. IBM did have a world-leading market share in its PCs over all rivals, using the world#39;s best-used OS. So was Nokia last year using its own world-leading OS in smarpthones. IBM decided to abandon that platform to switch to what was definitely no better than 4th biggest OS at any one point in time. Nokia did the same abandoning the leading OS for what seems to still today be the 7th best (might be 6th best for Q4 when the final numbers are out). And just like IBM, Nokia has already seen its global market leadership position collapse last year, falling from by far the biggest smartphone maker to only third biggest by Q3.#0160;br /br /Kodak lost because while it invented the digital camera, it did not pursue the opportunity from the start, and when it finally did, it never did it well enough to recover the leadership position. This is not the analogy to Nokia, which also invented the smarthpone, but Nokia did pursue leadership in smartphones and did that successfully for every single quarter smartphones have ever been sold up until Q2 of 2011.br /br /The correct mobile phone handset analogy to Kodak is Motorola. They did invent digital wireless telecoms but did not pursue that opportunity in consumer oriented cellular phones until too late and never regained their leadership in it. They ended up losing to the rivals who went digital faster.br /br /The correct analogy for Nokia is IBM, where both companies had the global hardware leadership position in their respective industries. As the software side of the business was disrupted, both companies held at one point the world#39;s bestselling OS but in both cases, management moved away from the leading OS to the smallest in the market. This caused hardware sales to fall and in the case of IBM led to a highly profitable PC company reporting losses and being forced to sell its PC unit to Lenovo. Similarly Nokia turned into losses and now there are rumors that the smartphone unit (or indeed all of Nokia) might be sold.br /br /The irony is that at least in the case of IBM, the company understood that Microsoft the subcontractor of the OS was like a vampire sucking all the profits out of IBM#39;s box-mover PC sales. Microsoft saw the Macintosh shift in the industry as an opportunity to move away from Microsoft and try its own OS instead. With Nokia it is very sadly the opposite. Nokia had a highly successful OS development team, including Symbian, MeeGo and Qt, And Nokia decided rather than use its own world-leading OS platforms, it abandoned that control of its own destiny, to adopt Microsoft#39;s OS and now has to pay a licence for every smartphone sold that uses the Microsoft Windows Phone software. The IBM decision was at least a reasonably logical one, that might have succeeded, and a worthwhile risk to take by management, that did not work out. The Nokia decision is simply an insane one.br /br /So Kodak management had a treasure among their intellectual property, which they did not understand well enough and failed to exploit. That was bad judgement by management. This was the same at Motorola with digital communications. IBM management issue was a case of a gamble in switching its operating system platform away from the market leader to a small rival. The execution might have perhaps worked but did not. Nokia is doing something similar and its early signs show that the change is actually even worse for Nokia than what happened at IBM.br /br /Thats my view on the Kodak analogies../p

pstrongWhat do these have in common?/strong/p pA car company built around a global community as an organisation, enabled by combining flex manufacturing techniques, open source platforms, open legal frameworks and social communication technologies premised upon cooperation, fuelled by the desire to be a great company and green; that can build cars 5 times faster at 100 times less the capital costs. A crisis management platform and organisation born out of the Kenyan post-election crisis of 2008 that can record critical information of events unfolding on the ground via a blend of location-based data, eyewitness accounts and mobile telephony, from often hard to reach places which visualises those unfolding events so that others can act and direct action at internet speeds. And now utilised for free in many parts of the world. Or, the largest organic diary farm in Britain, that has evolved a methodology that allows it to remain autonomous, profitable and sustainable in a market that is acutely volatile, because large-scale agricultural farming is mostly run on an oil-based economy, plus diary farmers are at the calculating mercy of the marketing needs and whimsies of large chain supermarkets./p pstrongA new social / organisational / economic model/strong/p pThey are collectively representative of a new reality of living, working and organising. These organisations or companies have quested to find a means to serve humanity better, to search for meaning in the work that they and others do, and offer up new viable alternatives for the ways that, in the past, these things were done. They seek an outcome that is more distributive of wealth, ideas and resources. In fact, one might argue an outcome that is more humane and community centric. Rather than premised upon the extraction of wealth, and resources, whether they be physical, mineral or otherwise, these very different initiatives represent both moral courage and a collective purpose, if you will. And why is that important? Because it does not matter if you are an employer, a worker, VC fund, an NGO, an organisation, a local council or a government, you will miss out on the energies and capabilities of your people who will increasingly seek those new realities to discover a better way of living, working and being, when better and viable alternatives are on offer. And the fact is we now have the possibility to truly transform our world, to be more lightweight, sustainable and humane, through the tools, capabilities, language and processes at our fingertips. As a href=http://www.no-straight-lines.com/585/ill-fares-the-land/ target=_selfTony Judt/a argued: ‘Why do we experience such difficulty even imaging a different sort of society? Why is it beyond us to conceive a different set of arrangements to our common advantage?’/p pstrongThe opportunity and the design challenge/strong/p pWhich brings me on to the title and the challenge of this project. Be realistic, imagine the impossible is taken from a poster from the 1968 Paris riots. In making sense of its meaning for our time, I would argue that what we face at the tail end of our industrial society is a design problem. The reason is that we are witness to a systemic failure of many of the institutions that have brought us so much prosperity and it is this convergence of failures that requires us to understand the challenge from a whole systems approach./p pMany of the institutions, organisations and systems that we still use were designed and built for a less complex world, the increase in the complexity of our world is placing an unsustainable load upon those institutions, organisations and systems. One could argue our industrial world has reached the edge of its adaptive range. Consequently, fault lines are running through our society which present a trilemma based around interlocking social, economic and organisational tensions and questions. The design challenge involved in resolving these questions comes because the non-linearity is causing a comprehensive restructuring of society at large, breaking old models of organisation, and the trilemma heralds the coming of the age of uncertainty. All three tensions are in flux, and cannot be addressed without considering the other two. So each and every part of this story reflects upon and relates to this trilemma: the relationship of the individual to companies and other organisations and forms of power, economically, socially, politically/p div pNow is the time when we need a way of evaluating of what comes next, when we face a world that has gone in a very short period of time from seemingly linear (simple) to complex and non-linear (chaotic). When we move into a world that is inherently more complex, the result is concussive, its disorientating effects surround us, and our responses either individually or at an organisational level result in reflexes and perspectives that can be dangerously corrosive or inappropriate. And yet, this chaos seems to be, if anything, accelerating. At this very moment, great debates are raging. The spanners are in the works, defined by 9/11 (we now talk about asymmetrical warfare) and the near collapse of the world banking system (and its asymmetrical impact on every single one of us). And, as the global centre of economic gravity moves east, this has set off a series of events that are having significant asymmetric economic effects on societies around the world. These are but three examples of fault lines creating battles, ideological or otherwise, that are exploding and imploding at the same time. They all surfaced in a single decade. Though it is important to add that their gestation period has been much longer and is indeed multidimensional. These challenges are highly interlinked and interdependent, so a one-size-fits-all response just won’t do. There are no longer simple problems; what we face is the trilemma of a complex world. This book does its best to face them, because we are in more than just an economic crisis; it is equally political, educational, spiritual and moral./p pstrongThe cultural challenge/strong/p pThe biggest challenge we face is cultural. How we contextualise (make sense of) the world around us determines how we engage and what action we take. Those actions then determine the outcomes we must live with and this requires a change from our industrial mindset and behaviour to one that is more cognisant of what is now seen as a non-linear world. This is where I want to return to the idea that what we face is a design problem, where answers exist not at an unattainable theoretical level but on the floors of our factories, in the streets of our towns and cities, the classes of our schools, the waiting rooms of our hospitals. These answers will manifest themselves as true acts of creation, originating new ways of getting stuff done, informed by the decisions we collectively take. So in re-designing the world, we need human creativity in the sense of the capacity to ‘make’, we need visionary leadership in the sense of making a difference. And we seek the craftsman’s critical eye, steady hand and creative mind. It is this process of seeing – realising new pathways to success, by bringing two ‘unlikes’ (new information, tools, processes etc.) together in close adjacency – that we create, and make new things. Then we can meaningfully apply that capability./p pstrong#0160;/strong/p pstrongThe coming age of the Craftsman/strong/p pWhy is the idea of craftsmanship significant at this epochal moment in time? Because it is about shaping our future and the ‘engaged’ craftsman brings the full power of humanity to bear upon his work. His hand is guided by his eye, informed by his creative mind; his productivity the act of unique creation. Indeed, the master craftsman is adept in using a philosophical framework, as well as tools and materials, to deliver useful things to the world. But more than that, the craftsman must be open constantly to new ideas; he is essentially always in beta. Therefore, we cannot engage with our uncertain non-linear world with the linear and inflexible orthodoxy of logic alone. The craftsman’s critical eye and creative mind is vital to evaluating new possibilities; he must be open to new ideas, information, tools and materials to make things that enable humanity to flourish. This approach is inherently more creative in that it synthesises all aspects of what make us truly human. But the 21st century craftsman does not only exist in the dusty workshop of a forgotten age; a games designer is a craftsman, a Linux programmer is a craftsman, innovative organisations like Local Motors and Ushahidi, which are discussed in more detail in Chapters 3 and 8, embed craftsmanship into everything they do. These are well designed responses to what real life previously perceived as intractable as the plot line in Catch¯22./p pAnd so I come to this project with a strongly held belief, that there is an opportunity to bring a way of thinking to many of the seemingly intractable problems that confront us today. But this requires us to think and act as craftsmen and women and apply our critical thinking to understanding our non-linear world, which is in part shaped by participatory cultures, open, complex and seemingly ambiguous systems that are highly interdependent of each other. We need to be inspired to be epic, to seek epic wins – to design for transformation, to make informed choices and co-author innovative new possibilities that can enable humanity to lead a life not constrained by the crushing reality of industrial-age thinking but one designed around the primary needs of humanity. We need to explore our non-linear world, not exploit it./p pI believe there is much evidence demonstrating the possibility of this society. It exists in philosophical frameworks, language and literacy, legal frameworks, tools and technologies, and real stories of how others have been motivated by a real desire to create new and better answers to what others would call unsolvable, wicked problems. And it has been my mission to bring together these separate component parts to offer to you a vision of the world which is both realistic and eminently possible. But to create this regenerative society requires us to take a voyage of discovery and to look upon the world as Proust would say with fresh eyes. This is the world of no straight lines and this project is how we make sense of this non-linear world, and then act in it./p pa href=http://communities-dominate.blogs.com/.a/6a00e0097e337c883301630008b5bd970d-pi style=display: inline;img alt=NSL-logo-bw border=0 class=asset asset-image at-xid-6a00e0097e337c883301630008b5bd970d src=http://communities-dominate.blogs.com/.a/6a00e0097e337c883301630008b5bd970d-800wi title=NSL-logo-bw //a/p pa href=http://www.amazon.co.uk/No-Straight-Lines-ebook/dp/B006MHSTS0 target=_selfNo Straight Lines/a at Amazon/p div p#0160;/p /div /div fieldset class=zemanta-relatedlegend class=zemanta-related-titleRelated articles/legend ul class=zemanta-article-ul li class=zemanta-article-ul-lia href=http://communities-dominate.blogs.com/brands/2012/01/no-straight-lines-making-sense-of-our-non-linear-world.htmlNo Straight Lines: making sense of our non-linear world/a (communities-dominate.blogs.com)/li li class=zemanta-article-ul-lia href=http://www.no-straight-lines.com/blog/the-next-silicon-valley-is-not-a-place-its-a-platform/The NEXT Silicon Valley is not a place it#39;s a platform/a (no-straight-lines.com)/li li class=zemanta-article-ul-lia href=http://www.no-straight-lines.com/blog/6-challenges-for-a-non-linear-world/6 challenges for a non-linear world/a (no-straight-lines.com)/li /ul /fieldset div class=zemanta-pixie style=margin-top: 10px; height: 15px;a class=zemanta-pixie-a href=http://www.zemanta.com/ title=Enhanced by Zemantaimg alt=Enhanced by Zemanta class=zemanta-pixie-img src=http://img.zemanta.com/zemified_e.png?x-id=fcdfdbc5-38a9-4466-8ee6-6c828c937fcd style=border: medium none; float: right; //a/div

pI am sure we are all a little sad of the passing of Kodak./p pSome of us of a certain age have piles of Kodak slides and snaps, even old Kodak cameras around the place. Hearing about Kodaks resignation and demise also got me thinking about Nokia, and indeed other organisations and industries that struggle and fail as they were unable to adjust to what was them an ambiguous world./p pstrongThe coming age of an uncertain worldbr / /strong/p pstrong#0160;/strongWhen faced with an ambiguous world some move into that world, and embrace it to understand it, listen deeply and think very hard about transformation - how to transform, how to design for transformation. This is a very hard thing to do and few do it well - a href=http://www.no-straight-lines.com/blog/lego-cuusoo-the-whats-next-for-business-in-a-non-linear-world/LEGO being an example of the few/a. And why is that? As Carlota Perez argues in her book a href=http://www.no-straight-lines.com/414/technological-revolutions-and-financial-capital-the-dynamics-of-bubbles-and-golden-ages/Technological Revolution and Financial Capital/a,/p p style=padding-left: 30px;emWhen the economy is shaken by a powerful set of new opportunities with the emergence of the next technological revolution, society is still strongly wedded to the old paradigm and its institutional framework/em. emSuddenly in relation to the new technologies, the old habits and regulations become obstacles, the old services and infrastructures are found wanting, the old organisations and institutions inadequate. A new context must be created; a new ‘common sense’ must emerge and propogate. /em/p pThere is indeed deep institutional resistance to real change. This is due to the voices of fear, cynicism and prejudice. And, as the forces of disruption increases often the resistance of organisations under threat does not abate but intensifies, until flailing against this unknown or misunderstood enemy they exhaust themselves./p pIts why Ambiguity is the first principle of NSL. You can read briefly about the other six here - a href=http://www.no-straight-lines.com/blog/6-challenges-for-a-non-linear-world/6 challenges for a non-linear world/a. With ambiguity there are 5 key points,/p ol liAccept the uncertainties of an ambiguous world and become master of them./li liStepping back – seeing the world more holistically – as a system/li liIt requires deep listening/li liTo move from being unaware to aware/li liTo seek new patterns that make sense even if they challenge pre-conceived ideas, positions and ways of doing things./li /ol pstrongTo be a little more expansive in NO Straight Lines I write:/strong/p p style=padding-left: 30px;emIn many ways ambiguity is the output of our current trilemma, but for that very reason it must also be a defining principle. When we individually and collectively live in an age of uncertainty, we must all become masters of managing uncertainty. As individuals or organisations we need to demonstrate the ability to face the future openly; we have to replace fear of the unknown with curiosity. We need to become aware of what is around us. To do that requires a step change in learning and self-improvement – this is achieved through continuous contemplation and self-reflection which ultimately enables the mastery of an aware self/organisation, with the motivation to pursue truly motivated goals./em/p p style=padding-left: 30px;emThere is a need to accept a lack of control, and of uncertainty, not only being prepared to accept being taken outside of one’s comfort zone but deliberately seeking it out – the consequence of which is a more disciplined mind or organisational culture, that is now capable of strong creative and conceptual thinking./em/p pstrongSo if we look at LEGO/strong/p ol liThey had the wisdom to recognise the old model of commerce was broken/li liThey had the courage to explore new and emergent means by which to create a new sustainable business/li liThey listened deeply and evolved an internal ability to critically appraise where they needed to get to/li liThey recognised the important patterns in co-creation and how they could have real benefits for Ramp;D, organisational capability, commercial models and marketing/li liThis enabled them to evolve to a new more sustainable economic / social / organizational model/li /ol pstrongThe dangers of trying to innovate whilst looking in the rear view mirror/strong/p pOm Malik a href=http://gigaom.com/2012/01/19/why-kodaks-bankruptcy-should-scare-nokia/writes,/a/p p style=padding-left: 30px;As my friend Pip Coburn says,strong#0160;turnarounds never turn/strong. Kodak has been in restructuring mode for 15 years – cutting headcount, closing factories, tightening belts and squeezing rocks for blood. In other words — the company isn’t fat in a traditional sense.#0160; But why none of its strategies worked was#0160; because the company took too long and sat on its duff watching digital photography come and eat it for a mid-day snack even though Kodak Ramp;D helped with the digital photo revolution when it launched the first digital camera in 1975./p p style=padding-left: 30px;And yet they failed to do what one of their major competitors – FujiFilm did — embrace digital with both arms#0160;a href=http://www.economist.com/node/21542796and is now thriving/a. And when Kodak finally did embrace digital in 1993strong it did with hesitance that comes when companies are afraid to cannibalize their existing businesses for the sake of the future.br / /strong/p pstrongDisruption never asks for permission/strong/p pNokia said it would never release a touch screen phone, so someone else did - a software company. In my journey in writing NO Straight Lines, I have seen this organisational myopia as a constant red thread. So I argue, to survive organisations have to disrupt themselves before someone else does it to them. Or as Arthur C. Clarke said,/p p style=padding-left: 30px;emThe only way of discovering the limits of the possible is to venture a little way past them into the impossible/em/p pMalik writes,/p p style=padding-left: 30px;emAnyone remember the Nokia 770? That phone could have been Nokia’s future, instead it is forgotten. #0160;Nokia#0160;defined itself by a certain kind of a product – the 12-key phone. People at Nokia talked about a multimedia mobile computer, but it couldn’t look beyond those 12 keys. It took Apple and Google to show Nokia how to re-imagine the phone./em/p pstrongStanding at the edge of the adaptive range of our industrial world/strong/p pWe have arrived at the edge of the adaptive range of our industrial world. At the edge, because that world, our world is being overwhelmed by a trilemma of social, organisational and economic complexity. We are in transit from a linear world to a non-linear one. Non-linear because it is for all of us socially, organisationally and economically ambiguous, confusing and worrying. Consequently we are faced with an increasingly pressing and urgent problem, WHAT COMES NEXT? And also we are therefore presented with a design challenge: HOW do we create better societies, more able organisations and, more vibrant and equitable economies relevant to the world we live in today? No Straight Lines presents a new logic and inspiring plea for a more human centric world that argues we now have the possibility to truly transform our world, to be more resilient, to be more relevant to us both personally and collectively, socially cohesive, sustainable, economically vibrant and humane, through the tools, capabilities, language and processes at our fingertips./p pThe key to unlocking this opportunity, so we can design for transformation is through understanding the interlocking concepts of the six key principles of No Straight Lines, these are:/p p[1] Ambiguity [2] Adaptiveness [3] Participatory cultures and tools [4] Openness/p p[5] Craftsmanship [6] Epic – designing for transformation/p pIt means we can then ask this question: strongHow do we find the best possible solution to seemingly intractable problems, and be able to answer them?/strong/p pa href=http://www.no-straight-lines.com/store/NSL Store/a/p pa href=http://www.no-straight-lines.com/blog/thanks-to-jo-pine-for-the-thumbs-up-on-no-straight-lines/nsl-logo-bw-2/ rel=attachment wp-att-927img alt= height=128 src=http://www.no-straight-lines.com/wp-content/uploads/2012/01/NSL-logo-bw.jpg title=NSL-logo-bw width=127 //a/p p#0160;/p div style=margin-top: 10px; height: 15px;a href=http://www.zemanta.com/ title=Enhanced by Zemanta/a/div div class=zemanta-pixie style=margin-top: 10px; height: 15px;a class=zemanta-pixie-a href=http://www.zemanta.com/ title=Enhanced by Zemantaimg alt=Enhanced by Zemanta class=zemanta-pixie-img src=http://img.zemanta.com/zemified_e.png?x-id=4e03e64a-9a17-448d-9eaf-f6a31db7f4ed style=border: medium none; float: right; //a/div

pJust a notice to some who may be wondering. My website went down around the time of the SOPA protests which also took down my business email address. (I was not formally part of SOPA protest but thought my webhost might be). That is now being fixed and we should be up shortly. Don#39;t panic.. :-)/p

pIts that time of year, we get to the quarterly results. The Smartphones Bloodbath as I have been calling it, and its Year 2: Electric Boogaloo is coming to a close. Within the next two weeks we#39;ll be getting quarterly results from the big boys including Microsoft, Apple, Nokia, Samsung, LG etc. A few companies reported last month (RIM, HTC) and some companies have already reported like SonyEricsson did today.br /br /What to look for in the earnings season? The big race for Q4 and the full year 2011 is for the grand prize, who gets to take Nokia#39;s crown as the biggest smartphone maker of the year and also for Q4. Nokia invented the smartphone and up to Q1 of 2011 Nokia had towered over its rivals being the world#39;s biggest smartphone maker every single quarter from the very beginning. A year ago Nokia smartphones was still as big as Apple and Samsung combined. But in Q2 we saw Apple pass Nokia to take the title, and then in Q3, Samsung leapfrogged both to claim the title for the Quarter. Now the race is between those two, Apple or Samsung, for who is the biggest for the Christmas Quarter of 2011 in smartphones. The annual race is also between those two but Samsung has a strong lead. Still, estimates for Apple range from 25 million to 35 million smartphone units sold (vs 17.1 million in Q3), so the race is still wide open.br /br /The next rankings are all pretty well set. For the full year Nokia will end up 3rd biggest. RIM is set to be the fourth and HTC the fifth biggest smartphone makers. For Q4 there is a chance if Nokia stumbles badly, for RIM to finish the quarter ahead of Nokia but its unlikely Nokia would fall behind HTC. br /br /There is a race for the sixth place, between SonyEricsson and LG. SE is well ahead but LG had been growing fast and SE growth was timid for Q4. For the full year 2011 its likely SonyEricsson will finish ahead of LG but if LG has had a very strong Quarter, they could sneak past SE.br /br /Motorola will end the year in eighth place, Huawei in 9th and ZTE in 10th place. But for Q4 it is possible that Huawei might pass Moto for the Quarter.br /br /In the OS wars the full year is all settled. Google#39;s Android ran away with it. Apple#39;s iOS comes in second, Nokia#39;s Symbian finishes the year in third place. These positions are very likely to be also for Q4. In fourth ranking we find Blackberry OS and in fifth place Samsung#39;s bada for full year stats. For Q4 it is possible that Microsoft based operating systems, the discontinued Windows Mobile (still selling) and the new incompatible Windows Phone may end up selling more than bada for Q4 now when Nokia#39;s Lumia smartphones have been released but its unlikely that Windows Phone alone has outsold bada, even with Nokia Lumia. And sixth place is a race between Windows Mobile and Windows Phone - and before you think that is a foregone conclusion - the latest data yesterday from Nielsen on Q4 new sales in the USA, Microsoft#39;s biggest market - report that Windows Mobile still outsold Windows Phone by a huge margin. And the data from Europe with Lumia launches suggests a disappointing Lumia quarter.br /br /One of the interesting tidbits will be the Nokia internal battle between internally unloved ugly duckling OS, MeeGo, that powers Nokia#39;s highly rated N9 and which is receiving rave reviews outside of Nokia, but the CEO refuses to support or sell broadly; and the Windows Phone OS powering Lumia, which the Nokia management loves to unbelievable degree, which is receiving lukewarm first reviews and seems to be disappointing in all launch markets. This sets up an interesting internal dynamic, how do they two OS platforms perform head-to-head. The N9 was expelled to remote markets like New Zealand and Kazakhstan and Nigeria, while Lumia was launched in Nokia#39;s biggest European markets like Germany, Britain and France. If we compare smartphone market sizes of the two launches, and their prices, and the affluence of consumers in those countries, and the fact that there were two Lumia phones and only one MeeGo phone sold in Q4 - the Lumia sales should outsell the N9 by a ratio of about 8 to 1. But some early market numbers suggest the N9 might come close to Lumia sales in the Quarter. That would suggest CEO Elop really should release the N9 and its sister model the N950 now to all Nokia markets rather than hide it in some of the smallest and most distant markets imaginable.br /br /As always, I will report on all of the smartphone players as they report their Quarterly data and I will compile an end-of-year review when we know the full market size and can calculate the final market shares. As always, I calculate the overall market size as the average of the four big analyst houses who report on global smarphone sales quarterly, ie Gartner, IDC, Canalys and Strategy Analytics. We should have received all company quarterly data by the end of January and the four analyst houses reporting by early February, when I should post my final Q4 and year 2011 market data and my analysis of every major brand in the race. Stay tuned. And now, its Samsung vs Apple for the Gold Medal. Bring it on!/p

pThere are 6 challenges I believe that organisations have to navigate to thrive in a non-linear world./p pThese are:/p pstrong[1]/strong How do organisations of all creeds deal with a more complex and increasingly ambiguous world?/p p[2] How do those organisations push through from living in an ambiguous world to one in which they can begin to design for adaptation?/p pstrong[3]/strong How do organisations learn to design for a more open world - which will be necessary for survival?/p pstrong[4]/strong How do organisations learn to design for a more participatory world?/p pstrong[5]/strong How do organisations develop a methodology for craftsmanship at a personal and more organisational level?/p pstrong[6]/strong How do organisations prepare for and design for transformation?/p pThese six challenges are also the six principles of NSL. What our research shows us that whether executed digitally or in our analogue world or indeed blended together - those organisations that have addressed these issues with conviction are the ones that have moved being stuck in a world of concussive ambiguity./p pClick a href=http://www.no-straight-lines.com/store/ target=_selfhere for NSL Store/a/p pa href=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330162ffc71103970d-pi style=display: inline;img alt=NSL-logo-bw border=0 class=asset asset-image at-xid-6a00e0097e337c88330162ffc71103970d src=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330162ffc71103970d-800wi title=NSL-logo-bw //abr /br //p fieldset class=zemanta-relatedlegend class=zemanta-related-titleRelated articles/legend ul class=zemanta-article-ul li class=zemanta-article-ul-lia href=http://www.no-straight-lines.com/blog/lego-cuusoo-the-whats-next-for-business-in-a-non-linear-world/LEGO CUUSOO - the WHAT#39;S NEXT for business in a non-linear world/a (no-straight-lines.com)/li /ul /fieldset div class=zemanta-pixie style=margin-top: 10px; height: 15px;a class=zemanta-pixie-a href=http://www.zemanta.com/ title=Enhanced by Zemantaimg alt=Enhanced by Zemanta class=zemanta-pixie-img src=http://img.zemanta.com/zemified_e.png?x-id=5ee8f47f-b351-4ae7-9075-49a2916c0342 style=border: medium none; float: right; //a/div

pThis is one of the blogs that has waited on my to-do list for a long while, but I had to get to it. And I think Alan Moore#39;s new book a href=http://communities-dominate.blogs.com/brands/2012/01/no-straight-lines-making-sense-of-our-non-linear-world.html target=_selfNo Straight Lines/a is a perfect opportunity to talk about mobile money. And on mobile money we should listen to the master on that topic, a href=http://www.chyp.com/about/our-team/ target=_selfDave Birch of Consult Hyperion/a, whose book emstrongDigital Identity Management/strong/em#0160;is also a must-read. So yes, Dave spoke at the Forum Oxford Conference last year and I really wanted to post a blog about his thinking about mobile and money and perhaps a few other related things too.br /br /WHEN EVERYBODY HATES EVERYBODYbr /br /First of all, Dave has been studying the digital money opportunity for many years and observed the evolution of the mobile money ecosystem. He said of the mobile money industry that emquot;The mobile wallet market structure is basically that everybody hates everybody else.quot;/em So in mobile this just like the mobile industry in general (of its usual mutual distrust that can degenerate into hatered and back-stabbing) but with far more global players. It includes the mobile network operators/carriers, who hate the handset makers, who hate the operating system providers, who hate the payments providers, who hate the plastic and contactless payments system providers, who hate the credit card providers, who hate the banks, who hate the retailers; and then all of whom then together hate each of the related regulators which now means banking regulators, telecoms regulators and consumer protection regulators (plus competition regulators ie anti-monopoly watchdogs).br /br /Spot on Dave! This is a quagmire haha, and it seems to only take off, if either the market has a very strong player who can do it alone, like NTT DoCoMo in Japan or Safaricom/Vodafone in Kenya etc; or else if after years and years of collaboration, the industry players can come together like in South Korea.br /br /So if you thought mobile money is #39;obvious#39; and has such superb benefits it has to happen immediately, and now as more and more players from Nokia to Google to Visa to Vodafone to Coca Cola to Tesco to Paypal to many big banks are talking mobile money, don#39;t think it will happen overnight. Remember, Turkey is the first country to issue a target date for the end of cash, and that year is 2025. So don#39;t throw away your credit cards just yet haha..br /br /EVERY PHONE CAN.. RECEIVE PAYMENTSbr /br /The Dave talked a lot about mobile in the money opportunity, with great insights. Dave said first of all, that emquot;The point of mobile payment is not that your phone is your card, but that the phone is your terminal.quot;/em Brilliant, absolutely true Dave! I#39;ve been saying this for a while too. Totally true, yes. The easy thing to notice, is that you can use your phone to make the payment, to replace the plastic card or banknote or coin, to pay for your parking or your Coca Cola at the vending machine or your train ticket. That is an evolutionary shift, from one electronic gadget in our pocket (the plastic card with the magnetic stripe and the security chip) to another (our mobile phone). But the radical shift is the other side, receiving payments. The average person cannot receive payments from a plastic card like a Visa card or Mastercard or a banking card. We have no way to verify that card is valid, and that it has a balance, and to deduct the paymnt from it. But any mobile phone can act as the receiving terminal for payments. We consumers can become #39;merchants#39; in that way, to handle payments, and real merchants can upgrade to digital payments without the expensive credit card handling equipment. This is what is powering so much of the mobile retail in countries from the Philippines to the beaches in Brazil.br /br /And that is something Dave talked about as strong#39;Mobile Enhanced Retailing#39;/strong. Its not that mobile will replace the retail shop - which it can do in some extreme cases like the internet did with music, books, travel etc. Sure in some extreme cases in retail, an m-commerce site can replace the retail store; but in most cases, the mobile is best suited to enhance our retail experience in anything from driving footfall to the stores, to adding to the experience within the store such as treasure hunts and getting more information about the goods, to speedier handling of the payments etc. br /br /BETTER TO LOSE PHONE THAN WALLETbr /br /Then the usual problem most of us #39;Luddites#39; have about mobile payments, is that we fear the single point of contact problem. That it would be dangerous to have our full wallet on our phone, and what if we lose our phone, or its stolen, or it is broken, or the battery runs out. Haha, yes, true, but the same problem is also with our plastic, what if your Visa card or American Express is lost, or stolen, or broken in an accident, or wears out so that it cannot be read anymore, etc. Dave made the very relevant point that we all in mobile money make almost daily - a payment solution is far more secure and far easier to recover from than any other payment mechanism. Yes its true. Dave said it this way:em quot;Its much better to lose your phone than your wallet.quot;/em Why? First, if you lose your wallet, all the cash in it will usually be gone no matter what, in most countries and most situations. So even if you are lucky to get your wallet back, you#39;ll probably have lost the cash that was in it.br /br /But what of the credit cards and banking cards and your driver#39;s licence and other identity cards, etc. How tedious is it to replace those. How long will it take for you to be rush-delivered a replacement American Express card? And then imagine how much worse that all can be if you are travelling and where is the next place where you will be long enough for a Fedex delivery of your rush replacement credit card can even be delivered. Compare that to mobile. On mobile, your mobile wallet solution can have user-set limits that you can alter when you want, on what levels of payments (if any) can be authorized without security pin codes etc - so the mobile can work like a contactless card like Octopus, Oyster etc. But this is far more safe, because you can lock your phone with a password (that you cannot do for the contactless card) and you can further protect your banking access with its own limits and security.br /br /Then take your credit card and banking card, with their quot;chip and PINquot; security etc. That all is already built into the phone, but actually your mobile phone is far more secure natively than the best chip and PIN card. And this is before you then set your own limits if you want, that an be altered by the user, and the further security that can be deployed in the handset, in anything from thumbprint readers to retina scans to voice pattern recognition - all things that a plastic card cannot hope to match. And this is before we take the power from the network - like location-based security and proximity based security. If the network knows you usually move from your home to your office to the school of your children and the shopping center near your home it can provide minimal security at that level. If suddenly the mobile phone moves to another city - then it can be set to notice the unusual travel pattern - and only then ask for a verification password etc. Same for proximity, so imagine a family travelling. As long as the phones are together, no passwords are needed (its almost impossible for a pickpocket to steal simultaneously all phones from the pockets of four family members at the same time) but the moment one of the phones moves away from the group, the password protection is enabled. Etc etc etc.br /br /HOW TO REPLACE MOBILE WALLETbr /br /But that was on the security side, actually the bigger benefit is if you lose your mobile. If you lose your cash, or contactless payment card, that money is gone. If you lose your credit card or banking card, you may lose some of your money and you have to call the bank to cancel the cards and then it takes at least days, may take weeks, to have your cards replaced. It will typically be even more of a hassle to replace identity cards like your driver#39;s licence or passport.br /br /But on mobile, the replacement is the fastest and most convenient. If your mobile wallet is enabled with your operator/carrier, all you need to do, is borrow someone else#39;s phone, call your operator/carrier, tell them your mobile phone is lost or stolen (or broken, fell into swimming pool at your hotel). They will ask your usual security words etc, and then they can enable your full mobile wallet - including all your credit cards and bank accounts and payment systems exactly as they were - onto any other phone on any other SIM card you designate. So imagine the family dad having a bit of a show-off moment at the hotel, and falling into the pool, and finding that the phone is ruined. He just uses his child#39;s phone, calls the operator/carrier, and has the mobile wallet functionality transferred to that child#39;s phone (which daddy will borrow for a day before they can go to a phone store to buy a replacement phone for daddy).br /br /This is BY FAR the most convenient way to replace lost or ruined or stolen or destroyed payment methods. It is far better to lose your phone, than to lose your wallet. And you are far better off, having your credit cards and banking accounts enabled onto the mobile than on any other forms like plastic cards. Now, obviously the retail world will need to catch up to this reality, only a few countries so far can do full payments in anything, in mobile, but that will soon evolve too.br /br /Dave gave some interesting facts, like that Google has 750 people only in their payments team, this is far more than any telecoms operator and far more than any bank has in its mobile payments unit. No wonder Google Chairman Eric Schmidt said last year that mobile money was one of Google#39;s three highest priorities.br /br /MOBILE BECOMES STORING MECHANISM FOR REPUTATIONbr /br /And the most far-reaching thought Dave expressed that I think comes to the core of what Alan and I have been writing about in our book emstrongCommunities Dominate Brands/strong/em and Alan in his follow-up bookemstrong Social Media Marketing/strong/em and now obviously in his latest, a href=http://communities-dominate.blogs.com/brands/2012/01/no-straight-lines-making-sense-of-our-non-linear-world.html target=_selfNo Straight Lines/a, is that thought of the power of the data collected. What Alan called the new Black Gold for the 21st Century. Dave said it like this: emquot;Mobile is the mechanism for storing your identity and reputation.quot;/em Its more than payments. Its more than money. Its on those themes that a href=http://www.jonathanmacdonald.com/ target=_selfJonathan MacDonald/a writes about #39;Advocurrency#39; and a href=http://uk.qustodian.com/ target=_selfcompanies like Qustodian/a now are working on to help us manage our identity and reputation and its value, via mobile. Imagine how much information a retailer loyalty card will collect about us. Imagine how much information a credit card or bank account will collect about us. And imagine how much Amazon for example knows about our preferences and purchases. br /br /Now imagine a near future when all of those data points get collected via a single point, our mobile phone. And our consumption behavior can be combined with our communication behavior. Its not just that Tomi likes James Bond and will see SkyFall the next 007 movie, but how many people did Tomi talk to about the movie before and after? Did Tomi influence others to go see the movie. The power of mobile money will be multiplied when we understand the value of influence, and that mobile, will merge with money, will merge with identity, will merge with communications, will merge with influence. That is why Google is in mobile money haha.. #0160;That is why this is such a huge race.br /br /Excellent presentation Dave, truly excellent with great insights.#0160;/p

pstrongComing home:/strong/p pThis is something of an emotional milestone for me, an emotional coming home./p pAs Tomi wrote - we set up Communities Dominate Brands - the blog when we published the book of the same name. We had no idea what would happen - but it became an extraordinary platform to connect with a global community. And in fact is now voted in the Forbes No.1 read blogs on mobile./p pThere came a point however where I felt I could not continue for reasons that were personal as well as professional. My dismay over 6 years of watching media / mobile and business organisations systemically destroy themselves (Tomi has a point of view on this) as we migrated from a linear to a non-linear world was overwhelming./p pMy turning point was an infamous meeting with the largest regional newspaper group in the UK, plus multiple engagements with Nokia and other major mobile and media players - where one could see these incumbents were driving down the road to oblivion. And of course they were not the only ones. Why I asked myself should I run a business trying to help those that can#39;t help themselves?/p pSo I went on a journey/p pstrongA road less travelled/strong/p pAs I continued to research the evolution of the media and the commercial communication environment, I had a dawning realisation that what I was witnessing was something deeper, more profound and epochal. It was in fact a communications revolution with deep social undercurrents that are having and will have a profound effect on every touch point of our society and our daily lives. And there is no doubt that technology, particularly communications technology, can be wielded as a powerful agent of social and political change. But we seem to have arrived at a crossroads, and this makes me fearful that too few truly understand the underlying reasons for what’s happening now or the implications of what happens next. Too many companies are locked into a linear system, a framework and model that only allows them to look at and engage with the world in a particular fashion. And this communications revolution is not about just companies and organisations; it is about us – you, I and society per se./p pstrongThe death and life of eco-systems/strong/p pWe are witnessing the death and life of two very different eco-systems - one which we started to describe in Communities Dominate Brands - and which is now truly redefining our world./p pstrongNo Straight Lines: making sense of our non-linear world/strong/p pThe result of that journey is the publication of a new book a href=http://www.amazon.co.uk/No-Straight-Lines-ebook/dp/B006MHSTS0 target=_selfstrongNO Straight Lines: making sense of our nonlinear world/strong/a -/p pa href=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330162ff8fa47c970d-pi style=float: left;img alt=NSL CVR-final_3 class=asset asset-image at-xid-6a00e0097e337c88330162ff8fa47c970d src=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330162ff8fa47c970d-120wi style=margin: 0px 5px 5px 0px; border: 2px solid #000000; title=NSL CVR-final_3 //astrongIn brief I explain the project/strong/p pWe have arrived at the edge of the adaptive range of our industrial world. At the edge, because that world, our world is being overwhelmed by a trilemma of social, organisational and economic complexity. We are in transit from a linear world to a non-linear one. Non-linear because it is for all of us socially, organisationally and economically ambiguous, confusing and worrying. Consequently we are faced with an increasingly pressing and urgent problem, WHAT COMES NEXT? And also we are therefore presented with a design challenge: HOW do we create better societies, more able organisations and, more vibrant and equitable economies relevant to the world we live in today? No Straight Lines presents a new logic and inspiring plea for a more human centric world that argues we now have the possibility to truly transform our world, to be more resilient, to be more relevant to us both personally and collectively, socially cohesive, sustainable, economically vibrant and humane, through the tools, capabilities, language and processes at our fingertips./p pYou can find the book online at a href=http://www.amazon.co.uk/No-Straight-Lines-ebook/dp/B006MHSTS0 target=_selfAmazon/a./p pJo Pine author of emThe experience Economy/em and emInfinite Possibility/em writes#0160; strong‘Anyone worried about where business is going in today’s chaotic world – and everyone concerned with where it should be going – must read No Straight Lines. Alan Moore has captured what is happening, but more importantly provides prescriptions for what individuals, companies, and society should do about it to create a better world’./strongbr / br / br //p pA little intro:/p piframe frameborder=0 height=331 scrolling=no src=http://tedxtalks.ted.com/video/TEDxSheffield-Alan-Moore-The-Tr/player?layout=amp;read_more=1 width=420/iframe#0160;#0160;/p pa href=http://communities-dominate.blogs.com/files/nsl-cvr-final_3.jpg/astrongIts good to be home./strong/p pyou can follow me on twitterstrong @alansmlxlbr //strong/p p#0160;/p p#0160;/p

pNokia was prominently featured at the CES show in the USA this week, the biggest consumer electonics show of North America. Nokia CEO Stephen Elop was on stage a couple of times as was Microsoft CEO Steve Ballmer. The brand new Nokia Lumia 900 won best product of the show. And nicely on que, Forbes ran an article of the a href=http://www.forbes.com/sites/erikkain/2012/01/08/five-reasons-why-microsofts-windows-phone-will-make-a-big-splash-in-the-smartphone-market/ target=_selfFive Reasons Why Windows Phone Will Make Big Splash in Smartphone Market/a. The article got a lot of attention and on first read, to the random reader, it seems to make good arguments (I will deal with those later). The first point to make, is that the author, E.D. Kain, had actually written a pair of articles about Windows Phone, this one yes in favor but a href=http://www.forbes.com/sites/erikkain/2012/01/09/microsoft-faces-an-uphill-battle-with-windows-phone/ target=_selfalso another one against/a.#0160;br / br /There have been many commentaries of the issue, perhaps the best direct response was by Don Reisinger at eWeek. He gave a href=http://www.eweek.com/c/a/Mobile-and-Wireless/Nokias-Windows-Phone-Strategy-Will-Fail-10-Reasons-Why-813986/ target=_self10 reasons why Windows Phone will fail/a. His arguments are very good, but they are somewhat USA focused and still do not tackle some of the biggest reasons why Windows Phone - and Nokia Lumia - will fail. Lets take this issue logically, reasonably and with facts, not just conjecture and opinion and hope and hype. And lets start where most sensible marketers start, not from the product but from the consumer. What is it that we, smartphone buyers, want. And readers, this is again one of those ultra-long Tomi Ahonen essays, about 16,000 words (more than a full chapter in a hardcover book) so go get yourself a good cup of coffee before you start. It will probably take you half an hour to complete this article but I promise you, it is stuffed with facts, stats, insights and goodies.br /br /EXECUTIVE SUMMARYbr /br /I know this is a painfully long article for most to read. So let me give you the quick executive summary version here on the top. Please do read the specific part in the full article, before commenting. But the short version is this. We know from global consumer surveys what people do on their phones, and what consumers look for when buying smartphones. That has even been measured across the differences of the wealthy countries of the Industrialized World, and the less-affluent smartphone buyers in the Emerging World. I have used real consumer data mostly from 2011, to examine every major element that is decisive in smartphone purchases today. I took the 13 most relevant areas which cover consumer phones and business/enterprise phones; across the rich world and the Emerging World. And on every one of those 13 areas, I evaluated Lumia compared to where Nokia (and Microsoft) was before and where its rivals are now. This is what I found:br /br /Reason 1 - Messaging Madness: Nokia has a natural strength in messaging-oriented smartphones (the most used feature of all mobile phone owners from Africa to the USA is messaging, including smartphone owners). It is abandoned with the first 3 Lumia phones. Nokia voluntarily foregoes a competitive advantage that it has always before taken advantage of. Thus Lumia will perform worse than Nokia smartphones have done before.br /br /Reason 2 - Camera Catastrophy - Nokia mobile phones have always been known for good cameras, its flagship phones tend to have had the best cameras in the world. The camera is the second most used feature. The Lumia series is a downgrade of Nokia camera capability and will severely disappoint past Nokia owners and not stand up to rivals today.br /br /Reason 3 - Look and Feel is not competitive. Nokia Lumia has gotten good reviews for its appearance but nothing beyond that. And by its one form factor alone, it will not win many converts, but on the abandoned other form factors, and its lack of typical Nokia elements, it is a downgrade from what Nokia has been in the past, and yet is not competitive with rivals today.br /br /Reason 4 - Nokia Brand failure. Nokia#39;s brand has been damaged very badly in the past year. Whatever Nokia was able to do in 2010, today Nokia will do far worse, whether in the USA or rest of the world.br /br /Reason 5 - Windows Brand failure. The Nokia brand damage is recent and perhaps reversable but Microsoft#39;s brand damage with Windows Mobile and Windows Phone has been sustained far longer and been far more comprehensive. Microsoft has good brands such as Xbox and Office Suite but its Windows Brand is weak and in mobile, it is poisonous.br /br /Reason 6 - Input failure. #0160;The Nokia strength has been exceptional QWERTY keyboards. On the N9 using MeeGo Nokia was able to innovate with touch screen inputs. But Lumia has neither. It is a cheap copycat of the iPhone style touch screen input and Lumia abandons natural Nokia strengths while showing no competitive advantages.br /br /Reason 7 - Fails in variety of models. Nokia has traditionally been able to hold to the world#39;s largest smartphone market share - a year ago Nokia was literally not just bigger than the iPhone, it was bigger than the iPhone and all Samsung smartphones - combined. Now Samsung is #39;doing the Nokia#39; with its expanding Galaxy portfolio while the three Lumia devices are near clones of each other. Nokia is again voluntarily abandoning a competitive advantage, which means Lumia will perform less well than Nokia was able to do in the past.br /br /Reason 8 - fails on apps and app store. Nokia#39;s Ovi was the world#39;s second most used app store just a year ago. That was replaced with Windows Phone, at best the 8th #39;best#39; ecosystem today, which still a year later has less than half the number of apps as Nokia currently still has on Ovi and Symbian. Whatever you thought of Ovi and Symbian #39;failing#39; in apps, it is far worse on Windows Phone.br /br /Reason 9 - the OS is deficient. The Windows Phone OS can seem exciting when first seen with its #39;Tiles#39; but on short usage it reveals how limited and unfinished it is. The tech reviews after using Windows Phone (and Lumia) are quite consistent that Windows Phone is not yet ready for prime time. It may become so in the future, but its not yet nearly competitive with advanced OS platforms out there.br /br /Reason 10 - regressing on features and services. Where Nokia smartphones tended not to be the coolest and sexiest in recent years, at least Nokia was always known for stuffing every conceivable tech feature onto its flagship phones. The joke was, that to see what will be on the next iPhone model, just look at a 3 year old Nokia flagship. The Lumia is the first time ever, that Nokia has regressed in its features, severely. Not just pruning unnecessary tech #39;bloat#39; but literally going back in tech, to specs that were normal on Nokia phones a year, two, even three years ago. That guarantees that any current owners of Nokia will find the Lumia a severe disappointment.br /br /Reason 11 - rejected by business/enterprise customers. I also discuss the enterprise/corporate side of the smartphone business. That market seems a great opportunity due to Microsoft Windows OS and Office Suite integration with Nokia smartphones. Except that this is nothing new. Nokia and Microsoft had done full Office Suite integration years ago and it helped Nokia and Microsoft sell... zero more smarpthones into the enterprise space.br /br /Reason 12 - poisoned carrier relationships with Nokia. The handset industry is different from the PC industry or home electronics, in that the carriers/operators decide which phone succeeds and which fails (witness the short-lived Microsoft Kin). Nokia used to have the platinum-standard carrier relationships a year ago. Those were burned by the CEO last year. Today Nokia#39;s carrier relationships are the worst they have ever been.br /br /Reason 13 - poisoned carrier relationships with Microsoft. But even worse, is that Microsoft never used to have good carrier relationships. And yet, with Windows Phone, Microsoft#39;s own departed exec admits Microsoft has been making those carrier relationships worse. So Nokia Lumia trades the best carrier relationships to bad ones, and then partners with the company with the worst relationships - that has been making them only worse last year.#0160;br /br /There is very much more in the article including aspects that are particular to the Emerging World (where half of all smartphones are now sold) and issues to such matters as build quality - Microsoft and Nokia have already admitted to two production quality problems with Lumia. Please read the article for all the details. But I said last February that the Microsoft adventure for Nokia was a high-risk gamble. Now we have seen what the Lumia is like, when managed by Stephen Elop, and it is an utter, comprehensive flop - on every single one of the 13 relevant issues that matter in the market success of smartphones. The Lumia series is doomed to fail. But please read the full analysis:#0160;br /br /LETS START WITH CONSUMERS/p pbr / Smartphones (invented by Nokia four years before the Blackberry) first were enterprise/business tools. Then they became consumer gadgets (also invented by Nokia four years before before the iPhone). What is their proportion? Deutsche Bank counted in 2009 that the total global market for enterprise/business smartphones was 96 million handsets. The enterprise/business market is very stable over time, it will not be significantly over 100 million today, so enterprise smartphones account for roughy speaking 1 out of every 5 smartphones sold globally. And Blackberry obviously owns a lions#39;s share of that market. So that is why I want to start with the consumer market where almost 4 out of 5 smartphones are sold.br / br / What do we do with our smartphones. You will fling a couple of birds angrily at some pigs and no doubt say #39;apps#39;. Maybe you will say #39;surf the web#39;. Those sound very reasonable. So lets see what the facts say. (And lets ignore voice calls). So what else do we do? The most used aspect on our phones is not apps or web surfing. It is SMS text messaging. The second most used funtion is the camera. I don#39;t say so. So says ComScore in 2011 - said 83% of Europeans and 68% of US phone owners sent SMS text messages. 58% and 53% respectively used the camera. Web browser is far lower, at 33% for Europeans and 39% for Americans. Apps are even further down the list, 28% for Europeans and 34% for US consumers. And if you are curious about email or social networking, they come far below.br / br / Is that SMS and camera emphasis perhaps an anomaly? No. Ofcom#39;s global survey just in November 2011 reported that SMS was by far most used service in Europe and the USA, mobile web well below and apps further down the list. Consistently with the above. Ofcom did not ask about camera use, but did ask about picture sharing and MMS. They were used on par with mobile internet and far above apps. So Ofcom is consistent with ComScore that SMS and the camera come ahead of web and apps.br / br / And lets be really really clear about this. If you don#39;t trust them Europeans and want the Pew picture, we have that too. A global Pew survey in December 2011. In the USA, SMS used by 67%, camera used by 57% and internet surfing by 43% (they did not ask about apps). In Europe Pew found in every country the same order, SMS most, camera second and web third.br / br / These were major surveys of all mobile phone owners. How about specifically emstrongsmartphone owners?/strong/em Well we have that data too. Zokem surveyed 10,000 smartphone owners in 2011 in the USA and Europe and guess what was used most by smartphone users. SMS of course! But yes, apps and the mobile web had switched places (they did not ask about the camera). br / br / Whatever we think of the smartphone buyer in the world, the target customer for potentially 4 out of 5 buyers of smartphones, the consumers, their number 1 interest is SMS text messaging. And yes, I am not saying that. It too was verified in 2011. Cloudtalk surveyed US smartphone owners in July and found 71% used SMS and only 40% used the mobile web (they didn#39;t ask about apps). Note again how consistent the finding is with the above. But Cloudtalk asked what one thing smartphone owners would most want to improve - emstrong90% of US smartphone owners said they would want better SMS text messaging!/strong/embr / br / REASON 1 - MESSAGING MADNESSbr / br / Did I make my case? Now is Microsoft the expert on SMS? No. The world#39;s first person-to-person SMS text message was sent in Finland in 1993 on the Radiolinja GSM network from one Nokia phone to another, by a Nokia employee Riku Pihkonen. Nokia wrote the book on SMS. Even the inventor of SMS, Matti Makkonen finished his career at Nokia (he was my last mentor). And what has been a major feature of Nokia smartphones always - a high proportion of them have had physical QWERTY keyboards in several formats such as the folder (ie Communciator format) and slider and Blackberry style wide candybar. There even have been exotic QWERTY form factors like the butterfly keyboard. If anything, Nokia was known as the brand that did SMS texting just about as well as it could be done.br / br / Did Nokia bother to put a QWERTY keyboard onto its first three Lumia phones? No! Note, this is a Nokia competitive advantage. Note, 90% of emstrongAmerican smartphone owners/strong/em wish this emstrongmore than anything else/strong/em, and its something for example emstrongApple refuses to do/strong/em with the iPhone. But no. Lumia series is pure touch screen only. Nokia had a massive competitive advantage that it simply refused to exploit. And is this relevant? NPD reported in 2010 that 46% of all mobile phone handsets sold in the USA had a QWERTY keyboard either as its sole input or combined with a touch screen input. Nokia voluntarily abandons nearly half of the addressable market and instead - forces, emstrongFORCES all Lumias to be compared to iPhones/strong/em (rather than compared to Blackberries).br / br / Then we have a href=http://www.mobileburn.com/18047/news/microsoft-testing-fix-for-windows-phone-sms-flaw target=_selfthe SMS design flaw. Microsoft has already admitted that it is true/a, if anyone sends a specific string SMS text message (or FB message or Tweet) to a Microsoft Phone based smartphone - it will shut down the phone and when the phone is turned back on, the messaging function is inoperable and the only fix is to wipe out everything stored on the phone - all messages, pictures, phonebook etc. What moron moron moron didn#39;t prioritize SMS and allowed this kind of failure at Microsoft? This would not have happened if the phone and its software was designed by adults. SMS is the most valued and most used service on mobile phones in every market - even the USA is now in that state, so said the USA#39;s own CTIA the Cellular Telecoms Industry Association in 2009.br / br / REASON 2 - CAMERA CATASTROPHYbr / br / So lets go to Nokia#39;s second huge advantage against all competitors outside of Japan and South Korea domestic markets. The camera. Nokia partnered with German camera optics specialists Carl Zeiss, and from the early N-Series on, Nokia had far and away the best cameraphones in that part of the planet where 98% of its population lives (Japan and South Korea have exceptionally advanced domestic mobile phone markets). Nokia introduced the world#39;s first optical zoom (ie real zoom) camera lens in 2006. The first Xenon ie real flash in 2007. Nokia had a 5 megapixel camera when the iPhone was introduced with only 2 megapixels. Nokia did the (non Japan/non-S Korea) world#39;s first 8mp cameraphone and first 12mp cameraphone. And its not just megapixels. Nokia had better glass on its optics, better sensors in the camera and better software for the pictures. Plus Nokia had removable storage media ie microSD cards so you could shoot many hours of DVD quality video and then just swap your microSD card and continue shooting. The whole camera and video experience was always superior on Nokia. Nokia introduced TV out in 2006 meaning you could watch your pictures, websites, videos etc on your home TV. And today that is of course HDMI out.br / br / This is the second most used ability of the mobile phone. We just heard from Christmas electronics sales in the USA, that digital camera sales and videocam sales had fallen catastrophically - because consumers were switching their camera and video capture to their smartphones. And this is a Nokia superiority. And what does Lumia offer. A emstrongmassive downgrade/strong/em to what Nokia used to have. The 2010 flagship Nokia smartphone, the N8, had a 12 mp camera and Xenon flash. It won every contest and comparison against every rival everywhere, a superb cameraphone and videocam phone. It was selected the phone of the year in Britain. And the N8 was that cameraphone used to shoot a full-length motion picture that had a commercial release. Yes. A Nokia cameraphone so good a professional movie maker made not an #39;experimental film#39; for a film festival, or a short film, or amateur film, but a full commercial production movie for cinematic release. That is Nokia excellence in cameras./p p#0160;/p pWhat does Lumia have? The topmost Lumia900 that was announced at CES has its camera downgraded from the N8. It doesn#39;t have 12mp. It has 8mp. The flash is not Xenon flash. It is LED flash. There is no TV out. There is no HDMI out. There is no microSD. This #39;flagship#39; phone seems like it was designed by total amateurs who were somehow utterly ignorant of the vast competence Nokia had built over the past decade. And it is. The Lumia series was not designed by Nokia top engineers in Finland. Elop in his Microsoft Madness decided not to use Nokia#39;s Finland based competence, he went to the USA to design his Lumia phones. Yes the USA, known for such fantastic global hit phones as the Palm, the Danger, the HP, the Compaq, the Motorola - anyone remember the Rokr - and yes, Microsoft#39;s own magnificent Kin, the phone so disasterous, it was terminated 6 weeks after launch.br / br / Nokia#39;s flagship phones have always, always had the best cameraphones (Japan, S Korea blah-blah-blah). The Lumia series is the first time ever that Nokia not only was not the best cameraphone, but it actually regressed. If you like your cameraphone, you are better off buying a 1 year old N8 than any of the brand new Lumia phones. The N8 was so good, that the first side-by-side test with HTC#39;s Titan II - with a 16mp camera, and the N8 produced better pictures. That is Nokia knowhow! And Lumia? Abandons it all.br / br / WHAT DO CUSTOMERS WANT IN THEIR NEXT PHONE/p p#0160;/p pWe have seen what consumers do with their smartphones. Now, what about specific decision criteria. All those who say #39;but the eco-system, Tomi!#39; That the smartphone OS will decide. Or the number of apps in the app store. Sure they will be important, sure. But lets go to the facts again.br / br / TNS surveyed 34,000 mobile phone owners around the world and found that in the Industrialized World (North America, Europe, Advanced Asia-Pacific) apps and the OS do matter. They came in ranked.. fifth. Tied for fifth. What is ahead of the selection of apps and the operating system in selecting smartphones in the Industrialized World? The Look and Feel. The Brand of Handset. The Input Method. And the Model of Handset. This is not me saying the OS is not top on the mind of smarpthone buyers, or the number of apps in the app store. This is what smartphone owners in the USA, Britain, Spain, Australia, Germany, France, Canada, Singapore etc have said. So before I discuss the OS and the Apps, lets do the more important factors starting from the top.br / br / REASON 3 - DOES NOT WIN ON LOOK AND FEELbr / br / Look. The Lumia 900 and Lumia 800 do look like flagship phones and have won plenty of praise, copying Nokia#39;s radical look of the N9 from last year. So yes, this is a brave attempt. But the Lumia 710 has a decidedly cheap look to it, very plasticky. But yes, what of the flagship(s). If you like QWERTY form factors ie a slider or Blackberry style smarpthone, then this look is wrong for you. The sad thing is, that usually with new lines, Nokia has done a pair, ie the N8 was the tablet style pure touch screen, and its sister model was the E7 with the QWERTY slider. Same with the N9 (pure touch screen) and its sister the N950 (with QWERTY slider). So while Nokia had every chance to gain an advantage on the look side, it voluntarily abandoned about half of the total market potential. By deciding not to make what is a competitive advantage at Nokia. br / br / But if you do love the pure slab tablet style pure touch screen smartphone. Then yes, the Lumia 900 and Lumia 800 are good-looking smartphones, emstrongbut not as good as the iPhone 4S/strong/em while being in the same price range. The big screen on the Lumia 900 is nice, but far bigger screens are on current Androids including the monster screen on the Samsung Galaxy Note. And where Nokia previously did have near retina display pixel density on the E90 Communicator, Nokia has again regresssed and now both Lumia 900 and Lumia 800 fall far short of the Retina Display sharpness of even the year-old iPhone 4. If you really love your QWERTY look, you won#39;t even consider these Lumias. If you do love this purist touch screen look - then you will buy.. the iPhone or the Galaxy.br / br / And while we are on the look, what about those weird neon colors? Yes, obviously the Lumia will stand out in the crowd, but it will soon mean that Lumia owners will be ashamed to show their phones. No wonder that one of the US carriers refused to offer the glaring color options. What happened to subtle and stylish? Nokia knows how to do that. But these colors are garish.br / br / Feel. What of the feel? Nokia has a history of truly exceptional feel to its top phones. The perfection in the camera shutter on the N93 or the precision of the hinges on the E90 Communicator or the sheer delight of engineering bliss that is the slider/folder motion in the E7. Nokia could have given us great feel on the mechanics - where Nokia excels far above all other handset makers. But it did not. The Windows Phone OS forces the standard buttons on the touch screen that crowd out part of the screen permanently and the other controls are pretty lame. Again, Nokia abandons what is its competitive advantage in a futile attemp to match the iPhone. For anyone who actually owns an iPhone will not play long with the Lumia in the store, before knowing the iPhone is a far better buy (if you already are an iPhone owner). br / br / The Look and Feel will be above average definitely but not on par with the top phones by the rivals. And when the price is about the same, on the look and feel, the Lumia is the clear loser already in the store. emstrongAll consumer reviews by the tech press say that the Lumia 800 fails head-to-head against the iPhone 4S or Samsung Galaxy etc,/strong/em and the Lumia 900 doesn#39;t bring anything better on its look and feel.br / br / REASON 4 - FAILS ON NOKIA BRANDbr /br /So the second highest factor deciding which smartphone normal consumers buy, is brand. Nokia had failed in the US market, so the Nokia brand cannot help Microsoft in the US market, that would need to be the other way around. In the USA Nokia is a bargain-basement cheapo-phone brand and the US market hasn#39;t even seen most of Nokia#39;s recent flagship smartphones like the N9, the E7, the N900, the E90 Communicator, the N86 etc. So in the USA, on this Lumia partnership, the conventional wisdom says that the Microsoft brand will help restore Nokia (on the Brand)./p pbr / What usually totally surprises US based readers is how strong Nokia is outside of the USA. In the Global Brand survey of 2010 by Interbrand, Nokia finished 8th best brand ahead of such icons as Rolls Royce, Rolex, Mercedes Benz, Porsche etc. It was no fluke. Nokia had been in the top 10 for the past decade, as high as 4th best brand in the world. In practically every country outside of North America, Nokia was the top phone brand as recently as 2010. Usually with a huge margin.br / br / Does it matter? Lets look at specific consumer opinion. A survey of nearly 2,000 consumers of the UK mobile phone market by Right Mobile Phone found that the mobile phone brand is more influential in deciding the next phone, than the carrier/operator brand. Andemstrong in the UK, Nokia was the phone brand with the highest loyalty/strong/em (not the iPhone or Blackberry which were a lot in the news for big market gains). How good was Nokia sales in the UK in 2010? Nokia#39;s market share of new sales in the summer of 2010 in Britain was 33% according to Kantar. That was the best market share of any smartphone maker in Britain. iPhone came second and Blackberry third. This bodes very well for Nokia and Lumia as these customers are coming in to replace their smartphones now in 2012.br / br / Except that something wild happened between 2010 and today. Nokia did not make an utterly failing phone like the N97 or one with a technical error like the Antennagate of the iPhone 4. The rivals did not come in 2011 with superphones with unbelievable features like say time travel or teleportation. Nokia gave ever better phones with better features (E7, X7, N9) and the Symbian OS released ever better editions and the Nokia Ovi store became the second-bestselling app store and everything was improving at Nokia. I am NOT saying Nokia had somehow magically caught up with the iPhone but emstrongthe fact is, Nokia had a record Christmas Quarter in 2010, and then things were improving for 2011/strong/em. Improving! This for the brand that had highest loyalty in Britain at the time!br /br /So what happened to Nokia sales in Britain in 12 months. Kantar gives Nokia#39;s market share in the summer of 2011 as .. 11%. Nokia had been the market share leader, with the best loyalty in the nation, and then produced ever better phones including one of Britain#39;s best smartphones of the year - and its rivals did nothing spectacular - remembering the iPhone 4 had already been released by summer 2010 and the 4S was delayed till Autumn 2011. And Blackberry had its dramatic market failure in this period. Yet Nokia lost two thirds of its customers in just one year. What happened?br / br / The British know what is the a href=http://communities-dominate.blogs.com/brands/2011/08/coining-term-elop-effect-when-you-combine-osborne-effect-and-ratner-effect.html target=_selfRatner Effect/a and what is the a href=http://communities-dominate.blogs.com/brands/2011/08/coining-term-elop-effect-when-you-combine-osborne-effect-and-ratner-effect.html target=_selfOsborne Effect/a. Nokia#39;s CEO Stephen Elop decided that one utter communciation disaster like Ratner Effect is not enough, he compounded it with an Osborne Effect. Both of those communication disasters independently ruined their respective companies, Ratners and Osborne. Elop doubled down and made the most costly management communciation fiasco in the economic history of mankind and devastated Nokia#39;s brand and market demand. He combined the Osborne Effect with the Ratner Effect in something I now call the a href=http://communities-dominate.blogs.com/brands/2011/08/coining-term-elop-effect-when-you-combine-osborne-effect-and-ratner-effect.html target=_selfElop Effect/a. Elop single-handedly wiped out Nokia#39;s demand in February 2011. He ruined Nokia#39;s brand.br / br / Its not limited to Britain, obviously. Kantar reported the same crash of Nokia smartphone new sales in all European markets. Similar stats come from all around the world and obviously Nokia#39;s own reported smartphone unit sales tell the same morose tale. In 2010 Nokia grew smartphone sales by 47% from the year before. Elop took that growth and torpedoed it, and for 2011 Nokia global market share collapsed from 29% in Q4 of 2010 to about 12% in Q4 of 2011 (we will know when Nokia releases its Q4 results shortly). This happened while the global smartphone industry exploded in 2011 growing by 59% from the year before.br / br / Nokia brand is sheer garbage today. So the second most important thing customers ask for, which was a strong Nokia asset, has been ruined not by manufacturing errors or market forces, by Nokia#39;s CEO with his idiotic communications last February. So maybe we can find salvage from the Microsoft side of this partnership. Or maybe not.br / br / REASON 5 - FAILS ALSO ON WINDOWS BRANDbr / br / Microsoft is a strong brand. The Office Suite and some of its components like Word, Excel and Powerpoint are clear market leaders in their fields. The Xbox brand is strong. But Windows. emstrongWindows is not a loved brand/strong/em. Windows is synonymous with crashes, bugs, delays, incompatibilty, viruses, spyware and tedious updates. Windows is why people talk of the #39;Microsoft Minute#39; in the delays to boot up a PC. The term Internet Exploder came more as mocking Windows crashes than IE the browser crashing. br / br / So Windows is a most unfortunate decision in branding. And the irony is, that Microsoft decided to emstrongrebrand/strong/em its smartphone operating system when it switched away from Windows Mobile. Microsoft could have called the new OS anything. Microsoft Seven. Microsoft Mobile. Microsoft Phone. Xbox Phone. Zune Mobile, Internet Smartphoner. XPhone, Ballmerphone, Redmondo. Or just about anything other than Windows. But no, they called it Windows Phone. So now the new Microsoft smartphone OS has the worst branding baggage out of the whole Microsoft empire. What a dumb move. br / br / But Branding is far more than the name of the brand. Lets see how strong the Windows brand is in smartphones. Lets go to the USA, its home market. In Q2 of 2009 Windows smartphones in the USA had 9.7% market share according to Gartner. One year later in Q2 of 2010, that had fallen to 4.6% !!! Note, at this time, Microsoft smartphones were made by Samsung, LG and Motorola - the top 3 bestselling phone brands of the USA - which did NOT experience a significant change in their market shares! Same for HTC, the pure smartphone maker. It too made Windows Mobile smartphones and it also did not see a fall, on the contrary, HTC saw a growth in the USA on its market share. br / br / How is that possible? These four smartphone makers also make Android smartphones. And in Microsoft#39;s best country market - the USA - when supported by each of the three bestselling phone brands of the US, and its biggest non-proprietary smartphone brand HTC - yet strongemMicrosoft#39;s Windows brand was so poisonous, that half of its customer base churned away from Microsoft./em/strong That is not a highly loved brand.br / br / So that was the #39;old#39; Microsoft Mobile. What of the brand-spanking new Windows Phone brand then? Windows Phone launched in 2010 We#39;ve now had over a year of its #39;success#39; and Kantar reported that the combined sales of Windows Mobile and Windows Phone based smartphones in the USA dropped by half again, from 2010 to 2011. Yes, even while switching to the newer OS, and giving it more than a year for #39;ramp up#39; strongemMicrosoft lost again half of what customers remained. This is a brand which is not loved./em/strongbr / br / The global picture tells the same story. Windows Phone had its peak sales a year ago of about 1.5 million smartphones in the quarter. Last quarter we have data for, Q3, Windows Phone sales had fallen to about 500,000 units worldwide. The Microsoft Windows Phone is not a strong brand in smartphones and neither is Nokia. For the second most important factor for smartphone buyers, the brand - both brands are so poisonous, this is the classic comment, two turkeys do not an eagle make. No matter how much lipstick you put on a pig, it is still a pig. Or polishing shit is still shit./p p#0160;/p pREASON 6 - FAILS ON INPUT/p p#0160;/p pThe iPhone revolutionized smartphones. The multitouch interface, on capacitive touch screen, and Apple#39;s brilliant, logical and intuitive software system, all worked. It was inherently better. That is what you need if you want a competitive advantage. Else if you do touch screen, you are just another rival. Nokia#39;s N9 and N950 on the MeeGo OS, with its radical swype method of input, is a major step. The Windows Phone input is not a radical improvement. In fact, it has severe shortcomings with no foldering, so the more you install apps, the more cluttered and clumsy it becomes. So the touch screen input is no better than any rivals, and is worse than the best. Nobody will buy the Lumia because its touch screen is superior.br / br / And where are the QWERTY inputs. Nokia failed the opportunity to do something Apple doesn#39;t. To be a viable option for the nearly half of consumers who do insist on a physical QWERTY keyboard on their phones. The sad fact is, that on QWERTY the keyboard on the E7 is truly magnificent. So it would have been an easy selling attribute for anyone trialling a Lumia in a store. But no. No QWERTY keyboards. Even though Nokia designed three very similar spec smartphones (and Nokia has tons of QWERTY phones on Symbian, S40 and MeeGo operating systems).br / br / REASON 7 - FAILSemstrong VARIETY/strong/em IN MODEL OF HANDSETbr / br / The fourth most important factor is the emstrongmodel/strong/em of the smartphone handset of any given brand. And here again, Nokia has the biggest production capacity. Nokia has the widest range of components and suppliers. Nokia can do the broadest product portfolio. Just like in cars, consumer preferences in mobile phones are very diverse. Someone prefers a Cadillac Escallade, another prefers a Toyota Prius. Someone prefers a Mercedes Benz C-Series, another prefers a Porsche 911. Someone else wants a pickup truck, or a minivan or a Smart Car. Apple makes its iPhones very similar to each other. Nokia is able to stretch its range to suit very divergent needs. If one of its three Lumia models is aimed to be an iPhone #39;killer#39; then make the other two as different and all three quite distinct from each other. When you look at the Lumia 900, it is like the designer of the Lumia 800 fell asleep. Where is the difference. Even the Lumia 710 is just a cheaper lame version of the Lumia 800. This is the desperation move by the small rival who tries by a few cosmetic tricks to expand its product line. br / br / Compare to Nokia#39;s biggest rival (who is not Apple#39;s iPhone, it is obviously Samsung). Samsung does just on its Galaxy series the obvious iPhone clone basic slab touch screen versions of almost exactly iPhone physical size; and then offers the Galaxy Indulge with the QWERTY slider; the Galaxy Beam with the pico projector; and the Galaxy Note with its gigantic screen. Thats how you do differentiation. But no. Nokia which could easily do this, rather has made three variations of one boring theme.br / br / But again, its even worse. Why is Nokia Lumia not on every network in every country? Nokia has easily the production capacity and the world#39;s largest phone sales network and distribution system including the ability to air ship a million phones a day, every day, anywhere it needs to. So lets take again just the USA. T-Mobile will sell the Lumia 710 but not the 800 or 900. ATamp;T will sell the Lumia 900 as an exclusive. The other big US carriers are not selling any Lumia handsets this Spring. So, in a perfect world, Nokia could sell 3 handsets on four networks ie 12 variations for the consumer. Now Nokia only offers 2 of those 12. If you want the Lumia 900, you can only get it on ATamp;T. If you want the Lumia 710, you can only get it on T-Mobile. And the Lumia 800? Gotta fly to Europe to get that.br / br / It is perfectly possible that Nokia and Microsoft marketing have convinced a random customer that they do want the Nokia Lumia smartphone. And that customer most likely went online somewhere to see what model they want. And then went to their carrier store, to buy it. emstrongAnd in 10 times out of 12, the carrier will not offer the Lumia which the customer would want/strong/em. Then - while the customer WOULD be willing to prioritize the brand of phone (Nokia) ahead of the exact model - in these cases, there is no other Nokia smartphone to sell (because idiot Elop decided to pull all Symbian phones from the shelves in the USA, and worse - refuses to sell the magnificent N9 and N950 which run on the MeeGo operating system). So. If the customer wants a specific model, and that is not sold by that carrier, strongemthe facts tell us that the smartphone customer would be willing to buy another Lumia or even another Nokia smartphone/em/strong - except that because of management madness, there are no others. It may be to Microsoft#39;s advantage that the customer doesn#39;t buy a MeeGo or Symbian based smartphone - but that customer will then go to another brand - and in 9 times out o 10, it will be either an iPhone or an Android. And in any case, if a customer wanting a Nokia branded phone, is not walking out of the store with a Nokia branded phone, that is a lost customer to Nokia (and gain to Apple or Android). Elop#39;s #39;strategy#39; is totally not in Nokia#39;s best interest.br / br / REASON 8 - FAILS SMARTPHONE APPS AND APP STOREbr / br / The smartphone apps portfolio is ranked only tied for 5th/6th highest priority for buyers of new smartphones. Note that all of the above come ahead of your precious app store. But then, come on. Windows Phone app store? It has only passed 50,000 apps. Even the #39;burning platforms obsolete#39; Symbian based Nokia (Ovi) app store has twice that in apps. Android is 8 times bigger, Apple iPhone App Store is literally 10 times bigger. If you walk into the store with the apps as your decision criterion, then Windows Phone fails from the start. And that is not even before we look at the apps. The reviews of WP7 apps say rather consistently that they are poor versions of their iPhone and Android masters, and further, that they do not take advantage of WP7#39;s abilities.br / br / These will get better over time. But the application developers#39; interest in making apps is totally dependent on their belief that its worth their while. Once they bother to count, to do the basic math, and see that there are about 190 million Android users worldwide, about 120 million iPhone users (and about 170 million iOS users when we add iPad and iPod Touch); and over 300 million Symbian users; and about 100 million Blackberry users - and only about 5 million Windows Phone users. Yes. The total installed base of Windows Phone today, about a year and a half from launch is... under one percent of the smartphones in use worldwide. Under one percent. Less than 1%. This is when the futility of bothering to create WP7 versions becomes obvious. Microsoft has been able to peddle the a href=http://communities-dominate.blogs.com/brands/2012/01/spin-and-sin-why-37-million-lumia-number-spells-disaster-for-nokia-but-not-for-microsoft.html target=_selfsheer impossibility of a #39;third ecosystem#39;/a - which even Microsoft loyalists would not have believed considering how ridiculous are Ballmer-oriented claims about Microsoft#39;s future - but they suddenly believed it, when the Nokia CEO said the same.br / br / Please do the math. We just heard from Morgan Stanley that they project Nokia and Microsoft to sell 37 million Lumia phones this year 2012 and 64 million Lumia smartphones next year 2013. This forecast by Morgan Stanley is quite optimistic. But lets assume it truly happens. Those numbers sound great, don#39;t they. That is awesome, isn#39;t it. br / br / So by December 2013, the world will have about 111 million Windows Phone smartphones in use. Yes. That might sound good. Except that in December 2013 the world will have about two BILLION smartphones in use (we will see about 700 million sold this year alone). So, even three years from now, the Microsoft Windows Phone OS family will have only about 5% market share. That is not a third ecosystem in anyone#39;s book. And Android will be over a Billion smartphones. Where is the developer attention going to go. Understand that even in 2013, Symbian will utterly tower over Windows Phone in installed base. So Apps will not win the battle for Lumia.br / br / REASON 9 - DEFICIENT OPERATING SYSTEMbr / br / The Windows Phone 7 and 7.5 Operating Systems do look cool and sexy when shown on stage or briefly demo#39;ed. But all experts who have reviewed Windows Phone have immediately pointed out that they are not even up to modern standards yet, far less being in any way #39;leading edge#39; technology. The tiles are a gimmick but mostly are only an update of Widgets that have existed on such #39;burning platforms obsolete#39; operating systems as Nokia#39;s Symbian. Windows Phone does do multitasking, but only just. For example the phone will not wake up from the alarm. So you buy yourself a Lumia and then set it up to wake you for the next day to go to work - and will have a severe #39;I hate Nokia#39; moment when your phone rings silently without waking you up. What is with that?br / br / The camera utility is limited and restricted. Windows Phone 7 doesn#39;t even support dual cameras (that came with 7.5). There are many application developer issues that are not supported - like the hottest area right now, Augmented Reality. Nokia#39;s past flagship phones have proudly done AR, but not these Lumias. And there is no support for NFC. And you cannot transfer apps and various content via bluetooth etc. The system is very restrictive and limiting.br / br / What is worse, the next update to Windows Phone is aimed at the cheapest phones, so the flagships cannot even catch up to the rivals with the next Windows Phone release. This is the Microsoft way. The short term allure of the Tiles does provide some in-store excitement. But when smartphone users start to use the Lumia, they soon are frustrated and disappointed. Again this is not me saying. I have not used a Lumia or any Windows Phone based smartphone. But the Guardian tech writer who bought a Lumia 800 in the UK before Christmas, a href=http://www.guardian.co.uk/technology/blog/2011/dec/30/nokia-lumia-800-goodbye target=_selfwas so fed up with it already after Christmas when using it, he returned the smartphone/a - and wrote in one of Britain#39;s biggest newspapers that its what he did. This is not proof of an OS that is ready for prime time. It may become that one day, but it is not competitive yet. This is probably more like Windows 2.0 (remember that, ouch ouch ouch) than Windows 3.0 which finally was the first Windows on the PC that was (barely) usable.br / br / Not everybody will return Lumias. But it will see more returns than its peers. That poisons the reputation both for friends recommending smartphones and the sales reps at the stores. The sales reps hate returns - because the customer has to be sold another model smartphone - but the sales rep won#39;t get a new commission. And then the rep has to do the returns paperwork and packaging hassles. Three times the effort for zero more commission - while the customer bitches and moans and gives the sales rep a bad day. So the sales reps learn real fast which phones have high return rates - and stop selling them!br / br / REASON 10 - REGRESSING IN FEATURES AND SERVICESbr / br / And the last of the major decision criteria in the Industrialized World for selecting smartphones is the features and services offering. And Nokia is known for a lot in this area. Nokia smartphones used to come with a huge array of pre-loaded apps and the devices were overloaded with technological goodies. If the iPhone was sexy and slick, and the Nokia was more bulky and unsexy, at least the Nokia had every conceivable tech built in, and several more you didn#39;t even know existed.br / br / I#39;ll be the first to admit most consumers won#39;t use most features and in recent years the smartphones have become so complex, even expert users couldn#39;t work all parts of their phones. So it was overkill on many levels. But for some consumers - remember this is only the 7th most important priority - they have their #39;check lists#39;. Does this phone have LTE. What resolution is video recording. Which file standards does the media player support. Etc etc etc. And then there is the specialist need. Like the customer who has had a previous Nokia and loved that its FM transmitter lets you connect to your car without an iPod cable connector. Or perhaps the customer has a collection of movies transferred to microSD memory cards, or whatever. br / br / So lets see how technologically advanced the Lumia 800 is, the flagship currently available - the Lumia 900 will release only on ATamp;T late in the spring about the time when we expect the iPhone 5 to launch. br / br / So, Lumia 800? Compared to Nokia#39;s previous flagships and current rivals. The Lumia 800 has only 8 mp camera regressed from 12 mp in N8 a year before. The market leader now has 16mp (HTC). The screen size is 3.7 inches, which is regressed from 4 inches on the E90 Communicator four years ago. Current market leader Samsung Note has 5.3 inch screen. There is no slot for any kind of memory card which is regressing from the microSD slot in the N8 that supported 32 GB memory cards. Today top phones support at least 64 GB microSD (and probably even bigger). The Lumia 800 doesn#39;t support video calling (Gosh, how far back can I go, I think it was the 6680 back about 2004 that first had videocalling support and every Nokia flagship has had it since.. except not now the Lumia. And obviously, after even Apple added videocalling support to the iPhone 4, essentially every rival (not using WP7) does videocalls. br / br / The flash on the Lumia 800 is LED, the first Nokia flagships to go better was the N95 and N82 in 2007 with Xenon flash. Several better cameraphones have it now. The Lumia doesn#39;t have FM radio, Nokia added it gosh, years ago, about 2005. Many rivals have FM Radio today. The Lumia 800 doesn#39;t support Real Media player files (that will play well with web services haha). Real Player was standard on Nokia phones still last year and most rivals support the file format. The Bluetooth on the Lumia 800 won#39;t support many types of file transfers, it did on past Nokias and does today on rival phones. The Lumia 800 doesn#39;t have a QR code reader installed. Nokia put it on its flagship first in 2006 on the N93. Most rival smartphones have QR code readers.br / br / Lumia 800 doesn#39;t have TV out, that came to Nokia flagships in the N93 in 2006 and many rivals have it. The Lumia 800 doesn#39;t support HDMI out which came to Nokia on the E7, and now some top rivals do it too. The Lumia 800 doesn#39;t read USB thumb drives and memory sticks. Nokia introduced this fantastic feature on the N900 in 2009 (note, yes, read thumb drives and other USB memory devices including portable hard drives making the smartphone behave just like a real laptop). I don#39;t know if other smartphones support this function yet but obviously Nokia has brought it to newer phones like the E7.br / br / And the Lumia 800 doesn#39;t offer a replacable battery. Nokia has started on that dumb path already earlier under Elop with the N8 being the first Nokia smartphone that didn#39;t let users replace the battery. Considering how heavily smartphones can be used on some days this is a huge disadvantage, especially for power users who surf the web, use WiFi, shoot video, play music, watch YouTube videos etc etc etc. Luckily Elop has seen the error of his way and now starting with the Lumia 710 the practise is ending, but there are still phones in the pipeline that don#39;t allow battery changes - like the Lumia 900. br / br / This is emstrongNokia#39;s current #39;flagship#39; which fails in side-by-side comparisons on many widely used and desired features and specs - with its Nokia brothers from years ago!/strong/em Years ago! How badly is the Lumia 800 regressing ! It seems like it was deliberately designed to fail in the market.br / br / We have looked at how consumers use smartphones, and what are currently the top things that decide which smartphone we buy next. emstrongBy every SINGLE criterion, Nokia Lumia is underperforming the market /strong/em- and on most it is regressing from where Nokia was before Lumia. If you thought the Nokia of the past was #39;obsolete#39; for your market, whether that was the USA or Europe or Asia-Pacific or wherever, this Lumia line offers you NOTHING that is better but on TEN separate factors, Lumia is now worse than what Nokia was last year. WORSE.br / br //p pREASON 11 - REJECTED BY BUSINESS / ENTERPRISE CUSTOMERSbr / br / So that was consumers. Many will be eager to argue the synergies of Windows and Office Suite at the enterprise/corporate customers. And drool at the amazing opportunity that Nokia business-oriented E-Series smartphones can have with full Microsoft Office integration. The massive global market share dominance that Windows and Office have in the workplace. This must be Lumia#39;s big market and Tomi is a total fool to not see it. Yes. Total fool.br / br / First, remember that only 1 in 5 smartphones sold worldwide is a business/enterprise smartphone. Secondly, remember that Blackberry owns roughly speaking half of that. Before we get into massive argument about Blackberry is dying, hear this: #0160;A 2011 survey of 20,000 businesses in the USA by TNS, found that Blackberry penetration ranged from 61% to 81%. Six out of every ten smartphones was a Blackberry in tiny US businesses of less than 4 employees and 8 out of ten smartphones was a Blackberry in the biggest corporations of 1,000 employees or more. The myth of the iPhone replacing the Blackberry is, alas, quite premature. The statistics of smartphone sales reflect that too. Blackberry is collapsing in consumer sales in the USA, yes, that is true (but growing internationally) but the enterprises are replacing their smartphones rather loyally, Berry by Berry.br / br / And before you say #39;Windows#39; - the second most popular smartphone in US businesses - Microsoft#39;s home country and Microsoft#39;s Windows PC and Office Suite penetration#39;s best country by far - is not Windows, not Windows Mobile nor Windows Phone. It is yes, the iPhone. If Microsoft Windows was such a magical synergy tool, why is the consumer-oriented iPhone outselling the Windows smartphones in the US enterprise/corporate space, after a DECADE of Windows Mobile / Windows Phone sales by Microsoft and its partners. There is no synergy.br / br / Which brings us to the Nokia Magic with Microsoft Office Suite integration. So what if we really do put the full Microsoft compatibility to E-Series? Surely that is the magic potion. Haha. You know what? That was already done. Not last year. Not in 2010 when Elop joined Nokia as its CEO. No. Microsoft and Nokia did full E-Series and Microsoft Office Suite and other Microsoft software business/enterprise integration in... 2009. And the big corporate/enterprise clients they landed in the next years? None. None. And you know who was in charge of that project on Microsoft#39;s side? Stephen Elop thats who. Rather than achieve corporate sales successes for their #39;strategic partnership#39; Elop rather prepared his job transfer from Microsoft to become CEO of Nokia the next year. br / br / So today ANY Symbian phone can do full Microsoft Office fully and all its peripherals and apps. Including Skype (Windows Phone does not support Skype). Symbian supports such vital business needs as.. folder (Windows Phone does not) and full multitasking and the transfers of apps and files via bluetooth. So doing your Microsoft business solution is far better on a Symbian E-Series phone than with Windows Phone! Remember, the old Windows Mobile was built to be business-oriented (as was Symbian originally). But Windows Phone was built to be the iPhone-killer - so admit Microsoft execs now - and it was made to be a consumer-oriented smartphone OS, not a business-oriented OS.emstrong If you seriously believe that Microsoft can win enterprise/corporate customers of any meaningful degree with Nokia, you are deluding yourself./strong/embr / br /And this is all without considering the natural need of enterprise/business phones - keyboards! Why is every Blackberry and every Nokia E-Series carrying a full QWERTY keyboard? That is what enterprise/business customers want. Why is Lumia not offering a QWERTY variant! br /br /No, Lumia will not do better than Nokia did before with E-Series on Symbian and E-Series on Symbian is more Microsoft-friendly and enterprise/corporate user friendly than Lumia using Windows Phone. Whatever success or lack therof, you have seen of Nokia in the business/enterprise space, that will do worse on Lumia and Windows Phone, not better.br / br / And finally on the enterprise/business users. The Microsoft loyalty and brand was equally demolished with the catastrophic crash of its market from 10% in the US market in 2009 to 5% in 2010 to under about 1% today (when adding both Windows Mobile AND Windows Phone). So don#39;t delude yourself into thinking that Lumia can somehow grow on the enterprise/corporate client side, either in the USA or the rest of the world. If Microsoft was the magic potion - surely Nokia should have been able to capitalize on it in 2009 and 2010 before Elop decided to set his platforms on fire like the psychotic arsonist.br / br / WHAT OF EMERGING WORLD ?br / br / Hey, that was only half of the world of smartphone sales. The planet has a population of 7 Billion who have 5.9 Billion mobile phone accounts. Only 1.2 Billion people live in the Industrialized World and all of the above only related to what is called #39;The West#39;. What of the Emerging World where 5.8 Billion people live, where 75% of all mobile phones are sold, and now half of all smartphones are sold. China overtook the USA as the biggest individual country market for smartphones last year. India is rapidly growing into another giant as is Indonesia, Russia, Brazil etc.br / br / First, most of the points in the above apply to the Emerging World but in perhaps different orders of priority. So for example the TNS global survey of 34,000 mobile phone owners worldwide on their purchase priorities with mobile phones, the rankings are different. The top 7 most important decision criteria are in this order: 1) Brand, 2) Model of Handset; 3) Network Provider; 4) Look and Feel; 5) Features and Services; 6 Operating System; and 7) Apps and Content. Lets look how these differ for the less affluent part of the planet#39;s population.br / br / AMPLIFYING REASON 4 - BRAND IS MUDDLEDbr / br / You understand that if Nokia was a rubbish brand in the USA, but still ranked 8th most powerful brand globally in 2010. then Nokia had to be far better than ranked 8th outside of the USA, after all the USA is by far the biggest economy on the planet. And it was. Nokia was not only the best phone brand essentially in every country outside of the USA, Canada (and South Korea and Japan); but it was literally the most valued brand: period. In many countries from India to Nigeria. The most trusted, most desired, most valued and loved brand. And that was of course also damaged massively by the Elop Effect as in the above. But some evidence. In India for example Nokia was toppled in 2011 from being the topmost brand. br / br / In the #39;West#39; we have PCs at work and home. We know Microsoft well and most of us use Windows based PCs. Both Microsoft and Windows are very powerful brands for us. But in the Emerging World they do not have PCs in every home or every office. If they do, they are often Linux based PCs (or have pirated Microsoft software which may be very buggy etc). So while we in the Industrialized World can at least theoretically have a good impression about Microsoft and Windows, and it can #39;help#39; in the branding battles - top priority please remember, then strongemin the Emerging World countries the Microsoft Brand is no help and easily a hindrance./em/strongbr / br / But Elop has consistently been making it worse. Making Nokia#39;s branding worse. He made a widely criticized decision to change Nokia#39;s naming, to go to pure numbering in its names (Not Nokia N9 or E7 or X7, but just Nokia 500 etc). This was very confusing and he reversed his decision two months later and today we have the Lumia series, the Asha series, and even individual phone models like the Lumia Ace ie Lumia 900. br / br / Then he decided to kill the Ovi store brand. The Ovi store was nothing, nobody and nowhere in the USA and no doubt when Elop flew every week from Finland to his other home in Seattle USA, he felt Ovi was a failure. Except that it wasn#39;t. The iPhone App Store is the world#39;s bestselling smartphone app store .. in those countries where the primary language is English. But all those countries combined have a population that covers 7% of the planet#39;s population. What about the other 93% of us? The biggest country by population is China. Biggest app store in China? strongOvi. /strongThe second biggest country by population is India. Biggest app store? Yes, strongOvi/strong. Third biggest population is the USA, but fourth biggest? Indonesia. App Store king? strongOvi/strong. Fifth biggest population is Brazil. Store?strong Ovi./strong Then Russia. strongOvi./strong Nigeria. Ovi. Pakistan, Egypt, Bangladesh, Vietnam, Turkey, strongOvi Ovi Ovi.../strongbr / br / Nokia#39;s Ovi store supports over 50 languages! And obviously, local developers can offer local apps in their home languages! And emstrongnow Elop wants to cause all that confusion by discontinuing the Ovi store brand./strong/em Why? What possible benefit can it deliver, while Nokia#39;s overall apps partnering is in turmoil with Symbian and MeeGo and Maemo and Windows Phone and S40 and Meltemi and whatnot. And its not just that, very big global partners have been cross-promoting the Ovi store. CNN for example was promoting its Symbian smartphone app worldwide on countless daily ads on all CNN channels. The value of just that advertising runs in the millions except that Nokia got it for free. And what did CNN still promote in December of 2011 - half a year after the end of the Ovi brand - yes CNN#39;s smartphone app was available on the Ovi Store. No wonder Nokia#39;s brand is being flushed down the toilet. The CEO is actively assassinating the brand in every way he can.br / br / AMPLIFYING REASON 7 - FAILING MODEL OF HANDSETbr / br / In the Emerging World the smartphone situation is dramatically different from that of the wealthy Industrialized World. For us in the Industrialized World countries, it is no hardship to pay 600 dollars for a premium smartphone like the iPhone or Samsung Galaxy or Blackberry Bold or Sony Xperia or Nokia Lumia 800. But in the Emerging World where it is very common to have a daily wage of 2 dollars (thats before taxes) a 600 dollar superphone is totally beyond reach. As implausible as thinking of buying a corporate jet or a superyacht. They dream of buying a bicycle to improve their lifestyle. They do have mobile phones but ones that cost under 50 dollars, often as cheap as 20 dollars new.br / br / (For US readers, remember, a #39;free#39; iPhone 3GS on 2 year contract is not a free phone. I am always talking of real prices, not the bogus prices of bundled contracts with handset subsidies. The African farmer who earns 2 dollars per day, can neither afford to buy the iPhone at 600 dollars without contract, nor to sign up for a 2 year contract of 50 dollars per month to get a #39;free#39; iPhone on handset subsidy).br / br / Here we have to go to the phone price pyramid. I don#39;t have a current one in the public domain but in 2009 Morgan Stanley published their price pyramid for mobile phones worldwide. Morgan Stanley found 2% of the phones sold to be premium smartphones; 11% to be other smartphones and the remaining 87% to be #39;featurephones#39; ie non-smartphones or #39;dumbphones#39;. These cheap phones in 2009 had an average price of 100 dollars (that has come down since then). In 2009 about 13% of new phones sold were indeed smartphones. Now about 29% of all mobile phones sold worldwide were smartphones.br / br / The planet did not suddenly have a huge rise in its wealth in the past two years (arguably, we#39;ve suffered globally with the economic crash). The poorer people didn#39;t suddenly all - billions of them - receive massive pay rises. But the total smartphone proportion of all phones sold more than doubled in the past two years. The only way that is possible, is if smartphones have become less expensive at the low end of the price point. The 100 dollar smartphone (remember, this is without contract! Without handset subsidies, a 100 dollar smartphone).br / br / And we have them! Nokia shipped sub-100 dollar smartphones from 2009 as did Samsung. We are now fast approaching the 50 dollar smartphone led by ultra-low-cost phone makers who specialize in the Emerging World markets, from global giants like ZTE and Huawei, to regional players like MiFone of Africa and Micromax of India etc. br / br / Nokia was perfectly poised to fight for this low-cost price segment with Symbian, because Symbian was designed to work on very modest technological requirements and often these ultra-low cost smartphones are not touch screen devices. Meanwhile Microsoft#39;s Windows Phone was designed to work on very high spec components - in fact, Windows Phone does not even work on Nokia#39;s standard chip supplier equipment like Texas Instruments. And Nokiaemstrong owned the low-cost smartphone space/strong/em. Canalys statistics tell us that in China in 2010 in Q2 the market share for Nokia (obviously running Symbian) was.. get this.. 77% !!! The second biggest smartphone maker brand in China was Motorola and Nokia was .. 16 times bigger than its nearest rival. This, in the country that was about to become the world#39;s biggest smartphone market. br / br / Similar stats from market after market after market. Over 70% of smartphones in India over 80% over the whole continent of Africa in new smartphone sales in 2010 were Nokia branded. Nokia had very accurately foreseen the future markets as they emerged, and provided suitable, low-cost smartphones for those markets and utterly dominated the Emerging World. And how? By offering a wide range of smartphone models. Now the Lumia 800 and 710 are far too expensive for this market. (again, US readers, don#39;t be fooled about T-Mobile contract price of 50 dollars for Lumia 710, it costs many times more without the subsidy).br / br / Lumia 800 (And 900) is utterly beyond the market price except for the rich elites, who will rather buy iPhones, Blackberries etc. The Lumia 710 is yes, cheaper than the 800 but its still far too expensive to become any kind of mass market success (its price without subsidy is about 350 - 400 dollars). But in the Emerging World countries, the price differential between models is far more value-driven. There are almost no subsidies, so you pay exact real retail price. One phone model costs 479 dollars, the next 529 dollars, another 499 dollars etc. The differences are nuances.br / br / And the buyer has worked far more for that dollar than we have had to for our dollar. The customer is far FAR more value-aware. The customer knows FAR more accurately what is true value. So the feature list is scrutinized far more thoroughly. All aspects are tried and tested before purchase. The advice and guidance of peers and friends is seeked even more than we might do. Remember, these customers do not have an internet to go do price-shopping. They do not read tech magazines with product reviews and contrasts and recommendations.br / br / With Symbian at low-cost smatphones, Nokia had conquerred the world. If Elop could have left Symbian alone, he would be now reaping the benefits of all the hard work Nokia did over the years. Except he didn#39;t. The Elop Effect collapsed the Nokia smartphone sales globally, not only in the Affluent countries but also in the Emerging World countries. So look at China. Analysys gave the Q2 market shares for China in 2011 and Nokia had crashed in one year to.. 22% with Samsung and Motorola nipping at Nokia#39;s heels. Now in October 2011, Morgan Stanley reported that Chinese consumers plan to buy their next smartphone preference for Nokia had fallen further to 18%.br / br / What Nokia would have desperately needed out of early Lumia was low-cost smartphones now, to try to hold onto that market share. It is being now burned forever. And the Microsoft Windows Phone cavalry will not arrive in time to save Nokia. The current Windows Phone edition does not support low-cost smarphones. Because of that, Nokia can#39;t even start to ship low-cost smartphones until the second half of this year at the earliest (if Microsoft manages to deliver on time). So the handset portfolio problem is far bigger here in the low end of the smartphones for the Emerging World markets.br / br / REASON 12 - HOSTILE CARRIER RELATIONS WITH NOKIAbr / br / The third biggest factor for smartphone buyers in the Emerging World, far ahead of apps or the OS, is the network provider ie the carrier ie mobile operator. The issues range from network coverage to service reliability to network technology to service offering and pricing etc. br / br / Nokia had THE BEST carrier relationships in the world. Nokia phones are sold on more networks than any other phone brand and Nokia has special partnership relationships with many carriers, ranging from the world#39;s largest carrier/operator China Mobile to the world#39;s most advanced and demanding carrier/operator NTT DoCoMo of Japan (the carrier who launched the world#39;s first cellular telecoms mobile business ie the company that started this industry). br / br / I am not suggesting that all Nokia carrier relationships were in good condition. The USA relationships were particularly damaged. But compared to any other handset maker, Motorola, Samsung, LG, Apple, RIM, HTC, whoever, Nokia had the best, strongTHE BEST /strongcarrier relationships worldwide. That is why even when Nokia had problems like the failed flagship smartphone N97, Nokia overall global sales did not suffer severely. Compare to Motorola which after the Razr launched the Rokr and today Motorola is no more, as the bankrupted and split-up handset maker it was bought by Google.br / br / Nokia cultivated the partnership model with its app store, Ovi, and its content and its networked services such as maps, advertising, mobile payments etc. Nokia had secured #39;carrier billing#39; relationships with over 100 carriers worldwide for Ovi (no other rival app store had even one quarter that level - carrier billing means one-click payments that get charged directly off your phone bill or prepaid account. No credit cards etc needed). With the language support, the ecosystems nationally around the carriers and Nokia grew meaningful in many cases. Now last year in February that all was suddenly sunk, with the Elop Effect.br / br / I am not suggesting the carriers/operators loved Nokia - Nokia was too big and powerful to be loved. But Nokia was seen as a mostly gentle giant, and one that mostly did not do harm to the ecosystem. And over time Nokia management earned a reputation that you could count on Nokia#39;s word. a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfThat all died with the Elop Effect/a.br / br / From February 2011, the global carrier community revolted against Nokia and Elop. Nokia was placed on a sales boycott. This has been reported only in anecdotal evidence and mostly in countries of the Industrialized World, but Nokia itself admitted in the Quarterly results that its carriers and distribution channel had reduced inventory suddenly and to an unanticipatedly large degree. Evidence? I can#39;t #39;prove#39; prove it to you, but it is very widely accepted by experts in the industry, that Nokia#39;s resale channel froze in February and Nokia products were removed from displays etc. This phenomenon continues and reports trickle in from many countries that Nokia smartphones are conspicuous in their absense from store shelves and inventories. Obviously the global utter collapse of Nokia smartphone sales is partially a symptom of this problem (and other problems).br / br / REASON 13 - HOSTILE CARRIER RELATIONS WITH MICROSOFTbr / br / Nokia was known to be friendly to carriers if bureaucratic and uncompromising. If that feeling turned to hostility, there is good chance it can be reversed. But Microsoft was known as the Evil Empire long before they announced the partnership with Nokia. Forget about Microsoft#39;s bullying of its developers and partners and rivals, and the prolonged feuds with the regulators on both sides of the Atlantic. emstrongJust in wireless, Microsoft is the mobile death wish/strong/em. Their very first strategic partner and launch customer for Microsoft#39;s first smartphones, UK based Sendo was driven to bankruptcy after lengthy court cases with the Evil Empire. Motorola went from profitable to loss-making in its strategic partnership with Microsoft smartphones. Motorola was so disgusted it announced it would discontinue smartphones on Microsoft platforms which gained it a lawsuit to boot. LG#39;s strategic partership with Microsoft bled the company profits into losses and LG ran to Android. HTC, Microsofts#39; longest-serving smartphone partner was so upset with Microsoft, it refused to support the final version of Windows Mobile and now strongly prioritizes Android. If you don#39;t know the history of how devastating Microsoft has been to its #39;strategic partners#39; in mobile, like the vampire, its bled them dry. Read a href=http://www.asymco.com/2011/02/11/in-memoriam-microsofts-previous-strategic-mobile-partners/ target=_selfHorace Dediu#39;s review of In Memoriam: Microsoft#39;s previous strategic partners/a.br / br / Microsoft is like the cheap prostitute. Not only has Microsoft been sleeping with everybody, but Microsoft then awards its #39;strategic partners#39; with a sexually transmitted incurable disease as a parting gift. br / br / While mass market consumers are usually blissfully ignorant of the backstabbing in the corporate world of partnerships, the carriers/operators are not. They pay very close attention to every player in the market. The carriers/operators know they need the handsets, and smarpthones need operating systems to run. They are very aware who is who and who plays naughty and who plays nice. No wonder that #39;do no evil#39; Google is getting global support everywhere. I do not have to go into the specifics of what all Microsoft has been doing in the past to anger the carrier community, as it is widely acknowledged that Microsoft#39;s carrier relations were #39;strained#39; or #39;challenged#39;. Even Microsoft executives acknowledge this as a fact.br / br / Then came Skype. I have a href=http://communities-dominate.blogs.com/brands/2011/09/why-do-carriers-hate-skype-let-me-count-the-ways.html target=_selfwritten another long blog explaining why Skype is the ultimate red flag to carriers/operators/a. You can believe me, or not. That doesn#39;t matter, we now have an ex Microsoft executive, no: ex Windows Phone General Manager at Microsoft, Charlie Kindel, who acknowledges that Microsoft had further angered the carriers in 2011. This is how he phrased it quot;Windows Phone raised its middle finger at the carriersquot; and to make matters worse, even after that, currently quot;Windows Phone requires Microsoft to push hard on the carriersquot; And the carriers do not like this at all. Kindel said carriers are reluctant. He said because carriers have explicitly decided to support Android rather than Windows Phone - quot;that is why Windows Phone has not sold as wellquot;. br / br / Whatever you thought of Microsoft success or failure in the past in mobile, emstrongthe ex General Manager of Windows Phone tells us that Microsoft had indeed had a bad relationship with carriers/strong/em, Microsoft#39;s attitude to carriers had already been one of arrogance and abuse; and that carriers hated it; emstrongand that since then Microsoft had been making matters worse /strong/em- and the resulting emstrongpenalty from carriers was to push sales away form Microsoft to Android/strong/em. I say boycott, you say tomato. Regardless, it is patently obvious that emstrongMicrosoft relationships with carriers were bad before and are getting worse with Windows Phone/strong/em. This now is again worsened as we hear for example from Europe that Nokia was bullying carriers about commitments to sell Lumia in Q4 etc.br / br / Whereas in the Emerging World, for smartphone purchases, consumers will look at the operator/carrier as the third most important issue - where Nokia#39;s reputation has suffered with Elop and Lumia; and its partnering with Microsoft has only made matters worse. This means Lumia is worse off than Nokia was before the Elop Effect. Worse off. Lumia is in trouble.br / br / AMPLIFYING REASON 3 - LOOK AND FEELbr / br / Remember in the Emerging World Nokia is the gold standard for consumers of mobile phones. They worship Nokias. Even the superphones are featured in the stores even as few customers ever can afford them. Proud owners walk with four year old models if they were top models way back when and so forth. In countries where the average person has no hope of ever owning a car, the mobile phone is the nearest thing to a true status symbol. Nokia has far higher assigned esteem than just a phone or gadget.br / br / So the customers know Nokia models and their specs. And they truly appreciate some minor details. That FM radio that you laughed at in the Features section many thousand words ago in this story? In Africa, literally, for about half of the population, the first radio they ever personally owned, is the one that comes on the Nokia phone. Yes, they don#39;t have TV sets. They are so poor they don#39;t even own a radio receiver. Not until the first radio in the mobile phone.br / br / The hideously stripped nature of the feature set of the Lumia line is screaming for rejection. Look at electricity. We take electricity for granted. In countries like Pakistan and Bangladesh the electrical grid is shut off several times.. per day .. to conserve energy. How do you live in that kind of world? The replacable battery is far more necessary. And power grid? In India and much of Africa the access to electricity is so rare, that people often send the spare batteries to nearby towns or villages to be recharged (while using the other spare battery to power the phone). Bluetooth file transfers, microSD cards, these are absolute must-haves where there will be no practical use or indeed network connectivity to use Microsoft#39;s SkyDrive. Nokia knows all this. The sensible smartphone designed for emerging world markets as a low-cost smartphone will have dual SIM slots, will have family ringing and family phonebooks (allowing the sharing of one phone with several family members) and will include the torch/flashlight etc where the village has no street lights at night etc.br / br / The Lumia including Lumia 710 was designed by affluent American college kids. They have zero concept of what a farmer in Nigeria needs or a lumberjack in Brazil or a fisherman in the Philippines. But Nokia#39;s #39;real#39; designers know. The past Nokia phones, dumbphones and smartphones have dominated the Emerging World. But this Lumia series including its #39;cheap#39; version Lumia 710 is a slap in the face of Emerging World markets. And the series will flop utterly, comprehensively.br / br / I COULD GO ONbr / br / Yes, I could. There is NOTHING in the Lumia 800 or Lumia 710 today, or in the Lumia 900 late in the spring, that is better than what Nokia had in the past, or what rivals offer today. emstrongWhatever you think of Nokia#39;s success in the past, whether you applaud it or are aghast, the performance of Lumia will be worse/strong/em. I have given you only 13 reasons why Lumia will fail. These 13 reasons are not my opinions of what I think should be the cause or effect for smartphone market succes. I have given you evidence and facts and stats and end-user surveys, showing what smartphone users do, and what smartphone users want, and what other factors influence the purchase decision ie the carrier relationshiops the corporate purchase departments.br / br / If you think another reason somehow #39;trumps#39; these 13 problems, I suggest you not only decide it is so, because you think that makes sense. If it is indeed true, you should be able to find experts saying so. If you do find experts claiming some benefits for Lumia, then compare those to this list of 13 and see if the evidence suggests one is more relevant than another.br / br / I SAID NOTHING OF BUILD QUALITYbr / br / The above is all sales related matters. Marketing, branding, design, price, distribution. They are utterly dooming Lumia. I didn#39;t talk about the reality of the device as it is manufactured, whether design flaws or component problems or build quality etc.br / br / This is a whole new can of worms. Imagine if if I sold you a Ferrari. A brand new Ferrari. And rather than it costing say 200,000 dollars, I charge you 150,000 dollars for the brand new Ferrari. Bright Ferrari red, the prancing horse logo and all. You get full registration and all details. A genuine Ferrari 2 seater sportscar. Luxury. Sportscar. And you are not quite familiar with all Ferrari models, so you then talk with your friend and then you go to the internet to see the actual details about this particular Ferrari model.br / br / What if you find out that your #39;genuine#39; Ferrari was not actually manufactured in a Ferrari factory in Maranello Italy. It actually came from India, from the Tata motors factory (the company that makes the cheapest car in the world). Well, that is not really the end of the world, as long as it does have real Ferrari components, except that when you look at the engine, you find it came not from Ferrari#39;s engine factory. The engine your Tata sportscar has, came from Proton the cheap car maker in Malaysia. But you do love the look and feel of the Ferrari and its bright red Ferrari color, until you drive next to another red Ferrari, and obseve that your red is not the same red. So you dig more and you find out, that this car wasn#39;t painted by Ferrari in its colors, it was painted by Kia the cheap car maker of South Korea. And you think, ok, but it does drive well, and at least it was designed by the iconic sportscar superstar designers from Italy. And then you find out, the car was designed by the tractor factory designers from Zetor in Russia. The only thing genuine Ferrari is the badge, which they bolted onto this fake Ferrari, and even that was not put on in Italy. No part of the car has ever seen the country of Forza Ferrari! Would you feel betrayed?br / br / That is the Lumia. emstrongNo aspect of it is genuine Nokia/strong/em. It was not designed by Nokia#39;s top designers from Finland. It was not manufactured in Nokia#39;s world#39;s most efficient and competent handset manufacturing factories. And it isn#39;t even powered by Nokia components like the CPU (the engine). And we know the decorations are not genuine Nokia - the operating system and apps (the paint job). Rather than Nokia#39;s own-designed mobile-optimised and smart OS platforms, Symbian and MeeGo, this fraudster uses an OS that was never designed to any degree by any Nokia programmers. And the production.. Get this. Nokia factories are the world#39;s most modern and efficient, including the world#39;s largest handset plant in China. They are now idling because Nokia sales have crashed. What does Elop do? He actually hired an outside company, Compal of Taiwan, to manufacture the Lumia smartphones! That is not a Nokia. Nothing about it is a Nokia, except that the CEO has the nerve to stick a Nokia badge on the phone and claim it is a genuine Nokia.br / br / Let me make an observation here. Stephen Elop is an excellent communicator but he seems to be a systematic liar. Just about everything he does, and everything he says, turns out to be untrue, often the opposite seems to come true. I am thinking of former Vice President Dick Cheney and #39;we know where the weapons of mass destruction are#39;. He looked you in the eye and lied, deliberately. That to me, is what Elop seems to be. None of his words have any relationship with reality or the truth. So lets continue..br / br / No matter what any expert may have said about how obsolete Symbian was or how horrible Ovi store was or how bad the software was, the one thing everybody agrees about Nokia, its build quality has always - always - been the best in the world. No Antennagates at Nokia. No exploding batteries at Nokia. No cracked screens at Nokia. There was the famous dog who ate the Nokia phone. It went through the dog, and the next day, in the dog poo, the Nokia phone was there, and it worked. They are bulletproof.br / br / Is that the same for a contract manufacturer with near slave labor in Taiwan who make phones and gadgets for dozens of companies? No. It cannot be. And the first evidence is already out. I mentioned the SMS crippling text. emstrongThere is a second technical manufacturing problem already admitted by Nokia/strong/em. The Lumia battery is failing. Some batteries draw down too fast, others don#39;t recharge properly and sometimes the problem blocks the whole battery operation. This is the build quality you get when you outsource your factory. The last vestige of Nokia strongholds - its superb build quality - is now jeopardized and indeed, first evidence of problems already not just reported - but acknowledged by Microsoft and Nokia! The Lumia is a failure and it will get worse.br / br / FORBES REASONS ARE QUITE SILLY, ACTUALLYbr / br / So lets go to the Forbes article then. The Forbes article starts off saying Windows Phone has a totally unique User Interface. That may be true. But is it truly more important, that the UI is #39;unique#39; - something no buyer asked for - or whether the operating system itself if useful, or the app store has tons of apps, or the camera is easy to use; etc. I am not saying it doesn#39;t matter at all. But I don#39;t see someone coming to the store, and buying the lousy phone with the unique interface rather than the good phone with the familiar interface. br / br / So let me quickly comment on the other five reasons. Forbes said Windows Phone would have less patent wars. That may be good for Microsoft (which seems not to care in the least about suing everyone so it might even be seen as a drawback at Redmond). But this is utterly irrelevant to Nokia. Nokia has the biggest patent portfolio of any handset maker in mobile and has invented the second most aspects to mobile behind only NTT DoCoMo. Look at the Apple lawsuit. Apple is suing everybody and winning. Apple surrendered to Nokia and now pays Nokia not just for every iPhone made, but Apple also paid a lump sum to compensate Nokia for the patent infringements of early iPhones. Nokia didn#39;t need to pay one penny to Apple. No, Nokia doesn#39;t need patent protection, and this wont#39; matter one iota in Lumia#39;s success or failure.br / br / The third point raised by Forbes is that with Windows Phone there will be uniformity across devices. So they claim no fragmentation. Obviously that is impossible, even with the iPhone there is fragmentation (Retina Display for example so the screen resolutions are different in the 3 series and 4 series of iPhones). But yes, I#39;ll accept this is a fair argument. Symbian is plagued with fragmentation (although it was getting less so) and Android is seeing more and more of it.br / br / So? Do you go asking your handset dealer about fragmentation? I think this phone has too much fragmentation, I#39;d like another phone with a bit less fragmentation? No. This issue is a total non-issue - for end-user consumers when buying the smartphone. Yes, some geek like you and me may know of it, but even for us, its very VERY low in the order of what we want. Fragmentation is relevant to application developers and other partners, not to end-users. If the market is big, and there is money to be made, then application developers will cope with the fragmentation. They don#39;t like it, but they will do it, if there is money. If the ecosystem is tiny, no matter how uniform it might be, if the market size is too small, they won#39;t care. Market size totally trumps fragmentation./p pbr / Then Forbes says that Zune is a reason why Windows Phone will succeed. Maybe so. But first, remember that #39;services#39; (like Zune) came in at 7th most relevant point when deciding, in the Industrialized World and 5th in the Emerging World. And Zune is only one in a series of services. Will it matter, of course it will. Will it decide some sales, maybe. Will it change the world for Lumia, of course not. Because most of all, there is Nokia Music! Nokia#39;s OWN music service! Nokia has been selling #39;Comes With Music#39; handsets for years. Zune might - might - duplicate the modest success of Nokia Music in the best case. More likely, today consumers have so many ways to get music by sideloading and on free music services, that it won#39;t matter one iota.br / br / Lastly Forbes mentions Xbox Live support. Note, this doesn#39;t exist and no word has been given that it will be arriving to Windows Phone and/or Lumia. So this is utter speculation of what MIGHT help the smartphone. Sure, like Madonna said to Wayne and Garth, And monkeys might fly out of my butt. Microsoft MAY do this some day. After that all games need to be repurposed to the Windows Phone format - thats no small feat - and the handsets need the gaming accelerators etc for the hardware, etc. This is at best a long-term gain. Except that I have bad news for you. Nokia HAS a VAST library of videogames already formated for the small screen. Nokia has its own gaming engine with graphics accelerators and all. Its called N-Gage. The first Nokia flagship smartphone to include the N-Gage gaming engine was the N82. And you know what. It did not set the world on fire, the gaming side. Yes, we all play Angry Birds but a vast gaming catalog of #39;pure#39; platform games, rather than custom #39;casual#39; mobile games? I don#39;t see Xbox gaming to be a #39;game changer#39; haha. But yes, even if you like this, this idea is pure speculation and cannot be implemented this year. So its pretty phoney by Forbes to add this as a reason why Windows Phone will #39;make a big splash#39; in the smartphones market this year.br / br / SO THE VERDICT/p p#0160;/p pI have given you my 13 reasons why Lumia is currently failing and will continue to fail. I based them not on my personal desires and preferences of what I like in my phones, I based it on the facts and stats of what real consumers do and want. I also refuted each of the 5 reasons Forbes felt that Windows Phone would win. What is the truth?br / br //p pWe will know in a few days when Nokia reports its Q4 results. Last year at this time, for Q4, Nokia introduced a new operating system version, Symbian S^3 led by the new flagship smartphone N8. This was not a make-or-break critical product launch. It was just routine, supported with no particular marketing effort. The smartphones were competing with many other Nokia smartphones already in the stores, so they faced competition from Nokia#39;s own product line. They sold 4 million units. That was a year ago. Since then the global smartphone market has grown by 60%. So just to compare apples to apples, the new operating system launch led by the new flagship phone, Lumia 800, would need to sell 6.4 million copies in the past Q4, only to match what Nokia did a year ago. br / br / And notice. All factors were totally in the control of Elop. He could choose which type of models Nokia would create - as these are truly new-from-the-ground-up smartphones, as they do not even use standard Nokia components. He could decide their specifications, their intended target markets and end-users. He could decide which countries and which carriers would be offered the Lumia. He could decide how to price them and support the launch with marketing. Elop could decide how and where to introduce the actual models to the public, how near or far from the commercial launch date. He could decide when to announce the Microsoft partnership. Nothing was forced upon him. This is totally Elop#39;s choice. The Nokia share price was not falling in February - the stock market liked Elop#39;s first five months of Nokia leadership so much, that the share price had climbed 11% - a very strong growth in a five month period for the new CEO, when the previous three years had seen a 50% drop in Nokia share price.br / br / And Elop could plan carefully, organize everything and make sure the most important product launch in Nokia#39;s history would be a total success. Elop had carte blanche to overspend on the launch marketing activities as much as he wanted, and obviously no other CEO in any other situation would have approved as extravagant marketing budgets for just any year#39;s #39;regular#39; flagship model launch.br / br / If thats not enough for you, there is the Microsoft marketing machine. Microsoft committed #39;billions#39; of marketing support to Nokia Lumia. So this is by every measure the single biggest product launch in the history of mobile phones. Nokia could throw all at it, and Microsoft would essentially then double that still.br / br / emstrongYou would have to be a colossal idiot to mess this launch up/strong/em. So, last year with only normal launch, with a tight schedule which could not be changed (the N8 and S^3 were delayed to an embarrassing degree), with only modest marketing budget (Nokia had just recovered from a quarterly loss) the N8 and Symbian S^3 sold 4 million copies. Adjusted for growth, this time that would be 6.4 million units. If Elop is only an average manager, he will achieve 6.4 million in his sleep. This time there is huge pent-up demand for Nokia phones and almost no rival Nokia handsets to steal any Lumia sales.br / br / With these matters utterly in his control the CEO can easily deliver that. Olli-Pekka Kallasvuo, the disgraced previous CEO could have easily delivered 6.4 million sales of Nokia#39;s newest flagship and its OS if given those parameters. Anssi Vanjoki even if asleep, even if simultaneously having nightmares, could still outperform the 6.4 million under those conditions. So we will see the mettle of Stephen Elop, is he competent to run Nokia. br / br / And all the evidence says Nokia Lumia sales in Q4 were a total disaster. Unmitigated utter colossal catastrophy. In Britain Lumia didnt make it into the Top 10 bestselling smarpthones even for the December month. In Germany the same story, not even the Top 10, not even for the December month. Customer surveys suggested only 2% of customers in the launch countries even considered a Lumia. The measured sales are worse than that. Every industry analyst with short term quarterly forecasts has either reduced their target or held steady. Not one, not a one analyst has increased their forecast. This while the industry reports massive jump in Q4 sales by rivals like Samsung and Apple.br / br / But the spin doctors are at it. Taking a book from Donald Rumsfeld they are trying to convince investors that Lumias will be greeted as liberators. They try to erase the known unknowns. Look what is happening. Nokia unattributed executive said Lumia sales were quot;getting good tractionquot; and quot;we are pleased with the early resultsquot;. But no named source and no numbers! One Nokia executive claimed the youth were growing tired of the iPhone. This against the reported evidence that the iPhone is breaking all of its sales record and on every national chart for which I have seen statistics, the iPhone 4S sits as the bestselling phone for Q4. br / br / What is even more insidious and will damage Nokia#39;s tattered reputation considerably, is the revellation that Nokia and Microsoft executives have been going to blogsites to argue with reviews if they were negative about Lumia. The employees did this with aliases, but were revealed from the website addresses they used. They came from Nokia and Microsoft offices. The a href=http://www.guardian.co.uk/technology/blog/2011/dec/19/nokia-microsoft-lumia-comments target=_selfGuardian reported on this for example/a. The Blogosphere is very upset with Nokia - perhaps less so with Microsoft as it seems to be par for the course. We now apparently have the Evil Empire and its Evil Twin. br / br / FARCE OF THE THIRD ECOSYSTEMbr / br / It is hard to avoid articles that talk about Microsoft and Nokia, that do not mention the promised nirvana of the #39;Third Ecosystem#39;. Elop and Ballmer talk about it at every opporunity. And they are very happy to quote reputable analyst houses who promised Windows Phone with Nokia will reach 20% market share or better in smartphones.br / br / There are literally thousands of news stories parroting that 20% number and the Third Ecosystem baloney. And when you think about it, if Google#39;s Android has about 45% and Apple#39;s iPhone between 15% and 20%, then if Nokia and Microsoft can get 20% - game on. This is Xbox vs Playstation vs Wii. Then yes, most definitely, Microsoft and Nokia are in the game and can certainly be believed, that they can win this game.br / br / Now the reality. While Nokia and Microsoft have been repeating the 20% numbers from those big analyst houses, as recently as October of 2011, the reality is, that those numbers are not news in October. They were repeating an old story. Not from September. Not from August or July or June. Not from May, but from April and March. And here is the relevant point - the two major analyst house projections for Microsoft Windows Phone with Nokia partnership, were published before Nokia and Microsoft Q1 financial performance numbers were released.br / br / They are based on data form Q4 of 2010. The forecast was based on numbers, prior to the Elop Effect. So yes, if you take Nokia in December 2010, when Nokia had 29% market share with Symbian; and you add Microsoft Windows Phone and Windows Mobile, who had a combined market share of 3%, and add those together, you get 32%. From that it is a very #39;safe#39; projection - actually quite negative of this alliance, if separately they are worth 32% but combined they only do 20% or 22% or something like that.br / br / Now we know that Stephen Elop destroyed his company in February. We know there emerged a sales boycott. We know the market share crashed, sales revenues crashed and Nokia profits vanished. Did those analyst houses bother to give an updated forecast? No. They have remained silent (in shock). They are hoping and praying that nobody ever ever mentions their absurd forecasts again.br / br / So, earlier this week, we had the very first major industry analyst house issue a fresh, post Elop Effect, forecast for Nokia and Microsoft Windows Phone. That was Morgan Stanley. They say that Windows Phone would reach about 37 million unit sales this year and 64 million in 2013. These number have been reported in hundreds of stories and the vast majority of those stories cheerfully reported that this was good news.br / br / I could tell you that a gambler left Las Vegas with 100,000 dollars in his pocket. Is that good news? It depends how much he had in his pocket when he arrived in Vegas. In this Nokia case, the gambler arrived with a million dollars and only has 100,000 to show for it. Utter total failure. That is what the 37 million and 64 million numbers reflect. Not success by any definition. Why?br / br / Lets add in the Symbian sales and see. Morgan Stanley forecasts that in 2012 Nokia will sell 40 million Symbian based smarphones so the total for 2012 for Nokia is 77 million. In 2013 the projection has 16 million Symbian sales for a total of 80 million Nokia smartphones. So far so good. Now the cold shower. In 2010 Nokia#39;s annual unit sales was 100 million smartphones which gave Nokia a market share in smartphones of: 33%. For 2011 it will be around 18% (maybe less). But after Nokia jumps into bed with Microsoft in 2012 the market share is not 20%, it will be.. 11%. a href=http://communities-dominate.blogs.com/brands/2012/01/spin-and-sin-why-37-million-lumia-number-spells-disaster-for-nokia-but-not-for-microsoft.html target=_selfIn 2013 Nokia and Microsoft will not magically recover to 20%. Morgan Stanley#39;s projection when converged to markets share is.. 8%/a./p p#0160;/p pDo you believe that emstrongabandoning 33% market share/strong/em - when your unit sales grew 47% and your revenues grew and your profits grew so explosively, for the last quarter Nokia set a record in profit growth of its handset unit - emstrongand replacing that with 8% market share only 3 years later/strong/em, with no growth but about flat sales, dramatically fallen revenues and at best miniscule profits (probably continued losses). Nokia has taken its customer base and walked it in front of a firing squad, and shot it dead. Destroying 75% of its customer base in three year! This is corporate suicide. This is a hara-kiri by the CEO.br / br / Please do not say Tomi hates Nokia. Those are not my numbers, they are Morgan Stanley#39;s numbers and they are the FIRST analyst house to dare to make a projection on the Nokia-Microsoft partnership. For what its worth, my gut says they are way too optimistic, the evidence suggests it will be worse that this.br / br / If Stephen Elop can deliver 6.4 million Lumia sales in the past Q4, I am willing to say in public, I was wrong, he is competent to manage Nokia and I will accept he#39;s made some mistakes that should be forgiven as learning on the job.br / br / If Stephen Elop can deliver at least the 4 million Lumia sales that Nokia N8 and Symbian S^3 did last year - without adding the industry growth, I would conclude that Elop is spectacularly incompetent or irresponsible or foolish or rash, but perhaps the Board can be forgiven to allow some more time for Elop to try to make his strategy work.br / br / If Lumia sales are below 4 million, Lumia has failed to an unacceptable degree. Elop will have squandered the only chance Nokia had had, to try to shift platforms, and blasted what any opportunity may have been left for Lumia. If the Lumia sales in Q4 fall under 4 million, the signs are undeniable that Lumia#39;s path is a dead end, a cul-de-sac, and the sooner Nokia Board sees this, the sooner they must terminate all activites that waste resources pursuing that route. It is the proverbial dead horse. And you can#39;t ride the dead horse the only thing you can do, is get off the horse and find some other way to proceed. If Lumia fails to sell 4 million copies in Q4, it will be so comprehensively rejected that Nokia cannot revive it. Then it is time to think what to replace it with? Android? MeeGo? Tizen? bada? Blackberry OS? Palm/WebOS? (check out where the leading forecasters now estimate Lumia sales for Q4. Can you spell 500,000 units?)br / br / And obviously my view already now as we await the Nokia Q4 numbers for Lumia is, that based on his behavior in the past year, Elop has mismanaged his company so totally, that he may not be allowed to continue running Nokia. He must be fired. Now!/p

pspan style=text-decoration: line-through;Leonid Brezhnev/span Kurt Lewin said there is nothing as practical as good theory. I had the honor of presenting a keynote to HSM the biggest business/management conference of Brazil, in Sao Paulo in the Autumn. I knew that my audience was less #39;techie#39; than usual, and more of mainstream management. I wanted to offer them value out of my keynote and I went back to a favorite theme of mine that I occasionally use, the Fundamental Curves. The presentation was exceptionally well received and as word spread about it, I promised I would write about it. To give you, my blog readers and my Twitter followers a chance to read what I talked about in Brazil. What is all the hoopla about..br /br /THE INEVITABLE SHIFT IN FUNDAMENTAL CURVESbr /br /Its funny, I noticed that it was in my second book that I discussed the Fundamental Curves. That book - m-Profits (the world#39;s first business book on the mobile industry) introduced Fundamental Curves with this sentence: quot;In this chapter I will examine the inevitable shift in the near future of access devices in what I call the #39;Fundamental Curves#39;.quot; That book turns 10 years of age now in 2012 haha..br /br /In the book and my presentations at the time, I used the fundamental curves to explain the relationship of fixed telecoms vs mobile; of the PC based internet vs mobile internet; of email vs SMS; of PDAs vs smartphones; and of stand-alone cameras vs cameraphones.br /br /A fundamental curve has an insight based on the concept of #39;inevitable#39;. The curve must conform to evidence that its pattern is inevitable. When you have two fundamental curves that intersect, that gives incredibly powerful insight. If you can find such fundamental curves before the intersection has happened, you know a transition will happen in that industry: inevitably. You will then have a powerful strategic insight that you probably can use to your business advantage.br /br /And an immediate example: Facebook has passed 600 million users. Its growth has been breathtaking, and I have heard some analysts say its growth has been the fastest to that level of any new tech or service. But will Facebook reach 7 Billion users ie the full population of the planet. No. While its growth is astonishing, Facebook is constrained by the global penetration rate of the internet. There are only about 2 Billion internet users (including home and office users, shared users like family PCs, schools and internet cafes; and mobile internet users). So Facebook will hit a natural barrier which is the penetration of the internet. Maybe the internet will reach 100% of the planet but certainly not with PCs. And unless the internet penetration reaches human population levels, FB cannot get there. So Facebook reaching everybody is not inevitable.br /br /But mobile phones will reach everybody (at least everybody who has learned to read and write, and everybody who still can remember how to read and write). The mobile phone penetration rates exceed the human population in more than 60 countries already. You see the difference? Mobile penetrations were an inevitable trend, Facebook has not yet been proven to be so (it may end up being one, but currently evidence does not support that view).#0160;br /br /HOW DID I GET HEREbr /br /I first was faced with a situation of Fundamental Curves when employed by Elisa Corporation / Helsinki Telephone and the Finnet Group including Radiolinja in Finland. This happened in 1996. I was literally the world#39;s first person to observe certain facts about our industry, that seemed impossible. I had been tasked by my boss, Matti Tossavainen, to build the Elisa Group#39;s first #39;bundle#39; of telecoms services. I was meeting with my peers, the various product managers and product line managers of the Elisa Group, to examine the data of their services, to consider which two services would be bundled with my service, the international calls which were branded quot;999quot; based on our international calls dialling prefix. Some who have followed international ice hockey over the years, may remember the Finnish hockey team tends to have these weird 999 number logos on their jerseys - thats my old product and we had a lot of affiliation with Finnish ice hockey.br /br /So for my service bundling project, I met with Mikko Heijari, the product manager for quot;950quot; GSM call services, ie our mobile voice calls product manager for the Group. Finland was at the time the run-away leader in mobile phone subscription penetration rates worldwide, and our brand, Radiolinja was the world#39;s first digital cellular service running on GSM and we were far ahead of our rivals in GSM subscriptions. Mikko#39;s product was not just in the world#39;s most advanced mobile market, his product was the clear market leader. And Mikko was of course trying to convince me to use his product as one of the three to be bundled.br /br /I remember it was early Spring and the quarterly data was not out yet, even internally. What Mikko did, was to take the latest available data, and then project that to the end of the month, to show how dramatic the current picture was. I was stunned. The numbers he showed me, suggested that the growth rate in mobile phone subscriptions was accelerating, not slowing down. And we in Finland had for several quarters dumbfounded all experts with unbelievably high mobile phone penetration rates.br /br /Based on the early numbers I prepared a proposal to use mobile phone calls as one of our bundled services (with long-distance calls the other) and took the proposal to my boss. We examined the data and by this time the first internal numbers were coming out and Matti was sold. I had won my argument to make mobile phone calls part of our bundle. At that point, I unknowingly had started the project that would create the world#39;s first fixed-mobile converged service.br /br /But it also meant, that I became intensely aware and interested in the curious pattern of mobile phone penetration rates - as obviously my reputation within the company was now tied to whether this phenomenal growth would indeed happen with the mobile side. At the end of 1996 Finland#39;s mobile phone penetration rate had passed 28% per capita. By the end of 1997, Finland#39;s penetration rate growth had increased further and passed 42%. We would sit with Mikko when each newest quarter data would come out, and study the numbers and look for when will it start to slow down. And in the Autumn of 1997 I remember having the meeting in Mikko#39;s office when we studied the latest numbers, when it hit me - this pattern will shoot past fixed landline penetration rates.br /br /That was an unbreachable barrier. Esteemed telecoms gurus had explained why it was utterly impossible for mobile phone penetrations ever to match, far less exceed, the fixed landline penetration rate. I remember looking at the numbers, taking out my trusty HP LX200 PDA and doing my calculations and looking at Mikko and saying - what I could not believe my own ears with me saying this - that in two years mobile phone subscriptions would exceed landline penetration rates in Finland. This was with the most pessimistic scenario. In two years (the reality was one year). Mikko looked at me, my math, and then plugged the numbers onto his PC and he had to verify it for himself. The trend was #39;inevitable#39;.br /br /WHY MOBILE CANNOT EXCEED FIXED LANDLINESbr /br /Today nobody doubts the facts. But back in 1997 and before, it was 100% accepted mantra that it was physically impossible for mobile phone subscriptions to exceed landline penetration rates (in the Industrialized World; it was theoretically possible for Emerging World countries to #39;leapfrog#39; the landline and go straight to mobile). Nobody doubted this, not even we - the people of Radiolinja and the world#39;s first GSM operator, the challengers of Finland. Even we did not believe it could happen.br /br /br /Here is why. The thinking was, that in the Industrialized World, with over 100 years of the telephone, the penetration rate of the telephone had reached saturation. Every household and every office was wired for the telephone. When you do the math, the penetration rate came at between 58% and 62% per capita across Western Europe, North America and Australia, plus the affluent countries of Asia.br /br /Then there were elderly people who had no need to be #39;mobile#39; ie didn#39;t have a need for a car (anymore) and were for example living in an old folks#39; home. They still had a landline telephone but would quite understandably have #39;zero#39; need for a #39;mobile#39; telephone. Not to mention with mobile you had to buy the handset and the voice calls were more expensive, etc.br /br /So even if every #39;other#39; telephone like home phones and office phones were replaced with mobile, there was a significant portion of the telephone network with these elderly people who absolutely certainly would never ever in a million years, be buying mobile phones and attempting to learn to use that difficult new and expensive technology.br /br /It made perfect sense. And I had heard big experts say this at big telecoms conferences, and I had read these theories in the major journals of the industry etc. I truly believed it to the core of my heart. And now I was staring at numbers which told me that the world was not flat. And like I say, #39;numbers are my buddies#39; - I decided that my numbers are right, and all the biggest gurus and experts were wrong. The numbers do not lie.br /br /So yes, I showed these to Mikko, who was equally stunned. And then we took them to Matti Tossavainen who was also astonished. Matti was so much the skeptic, he actually convinced me to #39;reconsider#39; and to wait until the next quarterly data came out. But in my heart I already knew that my numbers, my buddies, had shown me the light.br /br /TWO INEVITABLE CURVESbr /br /So the Fundamental Curves? One was clearly proven fact, that landline penetration rates will plateau and stop growing when all households have telephones. So that line will #39;flatline#39; ie run about parallel to the horizontal. And then there is another penetration rate - that of mobile - which was still accelerating in 1997 and would crash through the landline penetration rate and continue to grow. There you are: two Inevitable Patterns that cross. I was the world#39;s first person to see that mobile phone penetration rates not only could grow past fixed landlines, but that they indeed would.br /br /I remember having several heated arguments about this with many experts in Finland and at international telecoms conferences in London and Brussels etc over the next few years. And the Finnish pattern proved itself in late 1998. Many experts believed the numbers were faked. Then Norway and Hong Kong followed in 1999. And Italy, Sweden, Austria and the UK in year 2000. By this time even the big experts had to accept that it was no fluke, this would be a global trend.br /br /Now, as regular readers of this blog know, I am nothing if not curious. So of course it was not enough for me to spot this trend, I wanted to know why. Why did we break the impenetrable sound barrier in Finland or perhaps more aptly, passed the unbreachable speed of light haha.. Why?br /br /And so I dug into all kinds of data with the help of Mikko and the other experts of the mobile side of the company. I found out that some perfectly normal #39;non geeks#39; would actually carry two phones. The most common use was that one phone was a work phone, and the second phone was a private phone. Another common use was that the phones were on rival networks for many reasons including network coverage and pricing differences. I also found that bewilderingly, perfectly normal high school age kids in Finland were starting to have their own mobile phones. Teenagers! So where a family of four, with two teenagers, would typically have one home landline phone (and both parents would be reachable at work so the four people had three landline connections ie about 75% penetration rate in this simplified example) with both teenagers having their own mobile phones, and both parents having mobile phones, the household had one landline but additionally four mobile phones!br /br /By 1998 we were starting to see the early evidence of households abandoning landlines and going purely mobile. So I had not just seen the numbers, the absolute evidence, but I was now starting to have insights into why the impossible had happened. Fast forward four years, and by 2002 I had started to obseve several similar instances of #39;Fundamental Curves#39;. I had now learned to look for this phenomenon and gain the insights out of it. It made me seem often very #39;smart#39; haha, in the ability to see into the future.br /br /FUNDAMENTAL CURVES, REVISITEDbr /br /That makes sense really only from a historical point of view, and we don#39;t need to be convinced now ten years later, that there will be more users of the mobile internet than fixed internet, or that cameraphones will be used by more people than stand-alone cameras, etc. When I was preparing the HSM presentation, I dug into the Fundamental Curves and also looked back into my first data points (fixed vs mobile).#0160;br /br /Some technologies come and go, like the steam engine, the dirigable (zeppelin airships) and the telegraph. Others arrive and by all signs will never leave us, like the wheel, electricity and television. When I first used the Fundamental Curves thinking on mobile, I had accepted that the other Fundamental Curve, the fixed landline penetration rate, would remain stable - a perfectly horizontal curve. It didn#39;t occur to me back then around 1997 to 1999, even as early evidence started to trickle in, that landlines might diminish (to the point of possibly disappearing completely some day, like the telegraph, the Zeppelin andwhat is now happening to fax).br /br /With enough time having passed between the last time I had seriously calculated this pair of Fundamental Curves and today, the picture was strinkingly obvious. Landline penetration rates will decline. They have turned globally into decline already several years ago, and in Finland more than a decade ago. I have known this and reported on it in my books for many years, yet I never connected the dots, that this also alters the #39;Fundamental Curves#39;. What we have now seen, is a kind of cannibalization effect, which appears after the cross-over point. And... inevitably.br /br /Lets compare. The second evidence for me was the PDA vs Smartphone battle. Yes, the pattern holds, PDA sales turned into decline after Smartphones shot past. Then email vs SMS. SMS user base shot past email a decade ago. Last year we heard that email has plateaued, and some analysts believe email user base declined last year. Certainly every market reports that the youth are abandoning email comprehensively. So if it isn#39;t happening yet, it will definitely happen as that generation gets jobs. Next, cameraphones vs cameras. Yes, the evidence is out that camera sales have peaked and are now in decline. Wow. The Fundamental Curves are teaching me again something new. Numbers are my buddies! Even this grumpy old man can learn something new...br /br /REVERSE LETTER Ubr /br /I have written before that mobile is the ultimate cannibal. The formula for mobile phones is:br /br / A + B = A br /br /where A is a mobile phone, B is anything else (camera, PDA funtion, music player, GPS, video recorder, internet browser, etc). Or to put it in words, its like this:br /br /Mobile + Anything (soon becomes just) Mobilebr /br /Think cameraphones. Early on we added the camera to the phone. There were mobile phones and #39;cameraphones#39;. Today every mobile has a camera. Same happened with music players. Midway in the past decade there was a class of mobile phones that were #39;musicphones#39; but today every phone has a media player. And so forth. Mobile plus Anything will soon become just Mobile.br /br /Now when we take any rival technology that intersects with mobile, its growth will cease, and soon thereafter, will start to decline. So the shape is like a very shallow letter U, but reversed. It grows, then plateaus, then turns into decline. All after it has intersected with mobile.#0160;br /br /I was immensely excited when I saw that the data fit this pattern almost perfectly. Where it was not perfect, there is very strong possibility that it is only a matter of time. So for the HSM presentation I took the following list of pairs of services and products, going through the Fundamental Curves: Fixed and mobile telephones; email and SMS; PC and smartphones; and lastly mobile and fixed internet. Then I argued that I can see the early signs that this same pattern also repeats with money! (cash vs mobile money).br /br /First, understand the time frames. This does not happen in a couple of years. This takes literally a decade or more. But the beauty of #39;inevitable#39; is that it is certain. That is the nature of Fundamental Curves. I cannot promise you that this happens with Facebook and Twitter, we don#39;t have the evidence and I don#39;t know if the pattern is applicable within internet services. But at least on all those examples I listed (plus we have also seen it already in musicphones vs stand-alone music players) it is clear.br /br /There are at least four dramatic lessons you can take from any instance where you find a Fundamental Curves situation. First, that obviously mobile will not stop growing (yes, it will eventually stop, but not into the foreseeable future). Note that this means you have insights where almost all experts claim the opposite. Have you seen how Tomi Ahonen has been 100% correct on SMS forecasts every single year since my first such forecast in year 1999? And essentially all the other experts were wrong? Time and again, they promised us in 2001 that SMS was slowing and would be replaced. In 2004 we were to have witnessed the peak year for SMS and the fad would pass. That 2007 was going to be the pinnacle but that SMS would soon disappear. That SMS would start to die in 2010. And so forth and so forth. They didn#39;t believe in Fundamental Curves and thought that SMS would soon vanish. If the conventional wisdom is wrong - and you know it is wrong - you can make a fortune with the contrarian - but true - insight. (on Twitter at this point you#39;d see Tomi doing the SMS Dance..)br /br /Secondly, is the converse, that the usually dominant (in this case non-mobile) technology is going to be superceded. If mobile phone subscriptions will exceed landlines. Then it is only a matter of time when voice calls on mobile will exceed those on landlines, and so too will voice revenues on mobile. And if so, it means that mobile companies will grow to tower over their fixed landline cousins. And for the CEO of BT or ATamp;T to sell their mobile arm and keep the mobile arm will prove a disasterous decision in the long run (as we have seen).br /br /Thirdly there is going to be a cross-over point. This is a dramatic point that will be widely reported and its passing will shift the insights in the industry. You have foresight into a major moment in the industry. When is the right time to go from simple services on mobile to smartphone apps for example. Or when to shift your customer service priorities from email to SMS etc. The competitive advantage #39;window of opportunity#39; is open up to the cross-over point, after that you are only copying the industry and cannot really gain an advantage anymore.br /br /Fourthly there is the end-state. This is the astonishing lesson I just learned a few months ago when preparing that keynote presentation. Yes, all these technologies, after facing mobile, will fall to their demise. It won#39;t happen overnight, and technically it might not reach zero, but for a global mass market service or technology, the numbers will be so tiny as to being economically irrelevant. Its like horse-drawn carriage makers - they still exist but obviously compared to cars, the carriage industry is irrelevant in its size today.br /br /NOT EVERYTHING MOBILE IS INEVITABLE/p pbr / Note that not all things are inevitable, not even with mobile. We have good examples like video calls and LBS (Location Based Services). Other times the #39;inevitablity#39; may be altered due to timing - such as the delays with 3G launches at the previous economic downturn or the slope of the #39;mobile#39; curve may be at a slower rate (or faster rate) than we thought, such as happened with early MMS projections where we as an industry misundertood MMS to be more like SMS and email (which it isn#39;t) and didn#39;t see that as a mass media channel, MMS is a super-charged SMS. There was a fundamental curve for MMS, only it wasn#39;t going to replace SMS (and email) as we originally thought. (for those who don#39;t know, MMS is now the world#39;s second most used data application/service behind only SMS and far bigger by number of users than email or Google search or Facebook etc). br /br /And obviously there are some cases of a service or feature we have on our mobile phones that will almost definitely never replace its dominant sibling. Take light. We have #39;torches#39; or #39;flashlights#39; on many phone models. Others with larger screens have a #39;light#39; function and if you don#39;t have one, just take a picture of a blank piece of white paper in daylight - and you have a perfect bright light on your phone you can use if the electricity is suddenly cut off in your town, or if you lose something in a dark place etc.. So yes, we can definitely use our mobile phone as a light source. But it will not replace the light bulbs and light fixtures in our homes for example. So yes, mobile phones replaced our fixed landline phone at home (and our alarm clocks at bedside) but while we can use the mobile phone for our lights, we won#39;t be doing so (ever).br /br / And with some things the jury is still out like with smartphone apps. The pattern with the smartphone apps #39;economy#39; is dangerously near that of a tech bubble (massive numbers of free downloads and woefully little actual commercial success either from direct revenues or advertising - this is almost exactly what led to the dot-com bubble bursting a decade ago). The Fundamental Curves phenomenon has to satisfy the evidence of inevitability on both curves involved.br / br / And I am sure it is not restricted to mobile, its only that I study mobile. So I#39;m sure there are fundamental curves in other industries - air travel went from dirigibles (zeppelins) to airplanes. The airliner propulsion went from propeller-driven to jet driven enignes. In automobiles the early steam-powered vehicles were replaced by gasoline-powered combustion engine cars, but since then while diesel engines took over essentially all trucks and busses and heavy vehicles, diesel engines don#39;t seem to be on any inevitable trend in passenger cars (but don#39;t argue that point with me, I am not an expert on the car industry, I honestly don#39;t know the trend lines). Probably electrical engines will take over with time, or hydrogen or whatever.br /br /After my first encounter with the Fundamental Curves, the early cases were accidents, but because of my experience, I was very quick to notice where another situation of Fundamental Curves existed. And as mobile has been the fastest-growing giant industry ever in humankind#39;s economic history, those cross-over points have come rather quickly. And after I had seen a few of those, I started on a quest to discover situations of the Fundamental Curves, and this has been behind some of my most famous forecasts more recently, where I have been the first to make a huge cross-over prediction such as that of when musicphones would be outselling MP3 players including the iPod. And more recently for example that SMS will pass voice call usage on mobile phones. If you use the Fundamental Curves method to study your opportunities in mobile or elsewhere, it can help you make the right strategic choices.br /br /And if you do find new insights with Fundamental Curves (or by any other means), don#39;t be afraid of the arguments. I#39;ve been through this many times. Remember what Thomas Carlysle said of invention:#0160;emquot;Every new opinion, at its starting, is by definition a minority of one.quot; /emSo if you do discover something truly new, then you have to convince the rest of the world to believe what you know is true. That means you have to argue it with everyone. Over time you#39;ll find others who buy in, and who will spread the story too. But years and years later you will still find those who refuse to face those facts and you have to go through that argument once again. It is quite exhilirating to know you are the first person on the planet to have recognized some new fact or phenomenon. But after that comes the responsiblity to spread the story - and that does mean you have to #39;convince#39; all others - nobody else does know this and you start off as an absolute minority of one against the world. If your facts and logic is sound, you will then find people willing to listen and some willing to accept it.br /br /STRATEGIC LONG TERM CHOICESbr /br /So take HP and Dell and Lenovo etc. PC makers. The Fundamental Curves says that one day the modern PC will cease to have a mass market business. It might happen as soon as at the end of this decade and definitely by the end of the next decade. Replaced by what? Smartphones of course. Apple sees this as does Fujitsu and Google (and probably Microsoft although their behavior doesn#39;t really suggest that). So which company is being run by smart CEOs with a long-term vision and who are the morons who will go out of business? HP#39;s decision to abandon the Palm based smartphones is a perfect example of making the wrong choice. You can be 100% sure that if Steve Jobs was forced to pick keeping either the Macintosh or the iPhone, he#39;d have kept the iPhone. But HP abandoned its smartphone and kept the PC. This is like ATamp;T selling its wireless arm (or BT selling O2). Idiotic decision. The CEO didn#39;t understand the Fundamental Curves.br /br /So that is what was on my mind when I gave my keynote in Sao Paulo. And the audience loved it... I will be showing more of the Fundamental Curves thinking at conferences and workshops this year. If you would like me to speak to your audience whether a public conference or one of your customer events, or an internal event for your staff, I#39;d love to be there. Just drop me a line at tomi (at) tomiahonen (dot) com and we#39;ll set the wheels in motion.br /br /PS thank you eduardo for correcting the original source of the opening quotation. I had seen it before attributed to the past Soviet Union Premier, but clearly Kurt Kewin said it first, and am happy to attribute the quotation correctly.#0160;/p

pRemember all that BS written about the Nokia and Microsoft partnership and the supposed #39;third ecosystem#39; we heard from several big analyst houses in early Spring of last year. The sheer baloney that Nokia would somehow achieve 20% or more in market share with smartphones running the Microsoft Windows Phone OS. I was on this blog pointing out that those were utterly implausible projections, and they were made when we had no data yet of how damaging the Elop Effect had been, ie before even Q1 results were out from Nokia.br /br /Now, finally, eleven months after the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfElop Effect/a, we have the first new projection of Nokia and Microsoft partnership success, by a major analyst house, that was released reflecting the performance of Nokia Symbian smartphones and various Windows Phone smartphones in 2011. The major study out today is by Morgan Stanley, that projects specific annual performance for years 2011, 2012 and 2013. Their slide is on the a href=http://allthingsd.com/20120111/nokia-could-sell-37-million-windows-phones-this-year/ target=_selfAll Things D blogsite at this link/a. I have recreated that slide here, as I want to make some points about it.br /br /a target=_self/a a href=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330167605dc637970b-pi style=display: inline;img alt=MorganS-01 border=0 class=asset asset-image at-xid-6a00e0097e337c88330167605dc637970b image-full src=http://communities-dominate.blogs.com/.a/6a00e0097e337c88330167605dc637970b-800wi title=MorganS-01 //abr /br /br /First. The story is being reported in many news outlets as supposedly #39;good#39; news for Microsoft and Nokia. They celebrate that Nokia and Symbian will sell about 37 million Windows Phone based smartphones this year. Yeah. The Spin Doctors are at it. Those who are writing about it, have no idea what the truth is out there and what is the relevance.#0160;br /br /Secondly, please note that this January 2012 forecast for Nokia smartphone sales (Symbian and Windows Phone) is eerily similar to what a href=http://www.asymco.com/2011/02/14/who-will-buy-the-next-150-million-symbian-smartphones/ target=_selfHorace Dediu wrote at his Asymco blog/a and I wrote on this blog - a href=http://communities-dominate.blogs.com/brands/2011/02/when-things-get-even-worse-than-you-thought-1st-preview-of-potential-for-nokia-microsoft-partnership.html target=_selfforecast for 2012 is here/a and a href=http://communities-dominate.blogs.com/brands/2011/07/first-look-into-microsoft-nokia-smartphones-in-2012-and-2013-expect-climb-back-to-barely-20m-in-unit.html target=_selfforecast for 2013 is here/a. The point is that both Horace and I wrote those forecasts in February 2011. It took the big analyst houses this long - eleven more MONTHS - to come to the same view as we did back then?#0160;br /br /Here is the big picture. First. Nokia smartphones grew from 2009 to 2010 at a rate of 47% per year, powered by its new flagship phones like the N8 and what many call the obsolete Symbian OS, that released its latest version for Q4, called S^3. So what did Elop do? He replaced 47% growth in unit sales, and growth in revenues and giant growth in proftits in his smartphone unit, by causing the Elop Effect - and crashed Nokia smartphone sales.br /br /The reasonable view to Nokia#39;s future for 2011, when viewed in December 2010, with highly successful Symbian S^3 based phones like the N8 that was rated one of the year#39;s best smartphones - is that the growth that Nokia saw in 2010, would continue roughly at the same rate in 2011. If Elop was a reasonably competent CEO, that is what he should be able to achieve? So Nokia should have sold 147 million smartphones last year and made a huge profit out of them. That would not have been growth at the rate of the industry, so Nokia would have lost some market share but it would still tower over Apple and Samsung for the full year, easily. Instead, Nokia will sell (according to Morgan Stanley projection) 77 million smartphones - meaning that Nokia voluntarily abandoned 48% of its market with the a href=http://communities-dominate.blogs.com/brands/2011/12/calculating-the-elop-effect-hes-already-destroyed-a-company-the-size-of-oracle-and-profits-the-size-.html target=_selfElop Effect/a. (my forecast for Nokia Q4 is a bit lower than Morgan Stanley but until we get the official numbers, lets go with their numbers for now).br /br /The Morgan Stanley numbers suggest Nokia market share for 2011 was 18%, for this year 2012 it will be 11% and for 2013 it will fall even further to 8%. That is almost exactly what Horace and I said independently eleven months ago. And note, the Morgan Stanley 2011 projection is consistent with a current Q4 market share for Nokia down to 12%. I think this alone spells utter disaster for Nokia. But it gets worse.br /br /Bear in mind, for the full year 2010, Nokia#39;s market share was 33%. So Elop exchanges a 33% market share and growing Nokia smartphone sales with growing profits, using Symbian, for a massive drop in sales (and making huge losses) and then he can hope to find flat sales into 2013. And if this Morgan Stanley projection comes true, Nokia will have voluntarily thrown away 3/4 of its market share! Thrown away 3 out of every 4 customers it had.br /br /When I wrote that market share projection in February (and July) I was accused by many as being far too pessimistic about Nokia. Now we have the first big analyst house who publishes annual breakdowns of coming sales, that do not support any fantasy of a 20% or better share for the third ecosystem. This 8% market share for Windows Phone is likely to be 5th or 6th among the ecosystems at best.br /br /I don#39;t mind the reporters writing about the numbers for this industry and yes, the 37 million projection is what Morgan Stanley said, and it is very consistent with my view and that of Horace and others. But what I don#39;t like is that it is being spun now as supposedly #39;good news#39;. What good news is there, if you own 33% market share (making big profits) and replace that with 8% market share (making a loss)? For Nokia this is more evidence that the Microsoft strategy is sheer lunacy and a recipe for failure pushing Nokia towards bankruptcy.br /br /The only one who gains out of this is obviously Microsoft who currently have under 1% market share after more than a year of desperately pushing Windows Phone. If they can end with 8% for Windows Phone in 2013, then Microsoft will have bought some time to survive a bit further. But 8% is nothing like the third ecosystem. Not even close./p

pMany of the big companies in mobile are not true #39;mobile#39; companies in that their history is from other business and often mobile is only a part of their total income, like with Google, Apple, Samsung etc. Even of companies that we think of as #39;mobile#39; like Nokia, Vodafone, Verizon and Telefonica - they have sizeable fixed landline telecoms business. So in February of 2010 I went through the trouble of calculating out the pure mobile revenues of all the biggest players in mobile and a href=http://communities-dominate.blogs.com/brands/2010/02/the-25-biggest-companies-in-mobile-by-their-revenues-in-mobile-only-an-ahonen-25-index.html target=_selfpublished the world#39;s first global listing of the 25 largest companies, when ranked only by their mobile revenues. I called it the Ahonen Index/a and as far as I#39;ve seen, nobody else has published a similar list - quite astonishing considering that mobile is the fastest-growing giant industry, ever.br /br /I have wanted to update that list for 2011 and it got delayed and delayed. I ended up moving the calcuation point to the Q2 results (previous four quarters) so this is now roughly in harmony with the Fortune Global 500 issue which is published annually in the summer. And even then, as each company involved a lot of digging through their annual reports, it took me forever to get it done. But I have finally finished the analysis and am ready to publish the 2011 edition of the Ahonen Index: 25 Largest Companies Ranked by their Mobile Revenues. I have included their position also from the previous list and revenues last time so you see how the growth or decline has been. I am also including a Fortune Global 500 rank equivalent for those which would have qualified for the Fortune Global 500 based solely on their mobile business and what ranking they would have had.br /br /AHONEN INDEX - TOP 25 COMPANIES RANKED BY THEIR MOBILE REVENUESbr /br /Rank (2010) . Company, Country #0160;. . . . . . . . . Revenues (2010) #0160;. . Main Focus #0160;. . Fortune G500 Rankbr /br /1 (3) . . . . . . China Mobile, China . . . . . . . . . $ 77 B ( $ 65 B) . . . Operator . . . . . #0160; 87 **br /2 (4) . . . . . . Verizon Wireless, USA * #0160;. . . . . $ 72 B ( $ 62 B) . . . Operator . . . . . #0160; 92br /3 (1) . . . . . . Vodafone Mobile, UK * . . . . . . . $ 66 B ( $ 67 B) . . . Operator . . . . . 110br /4 (7) . . . . . . ATamp;T Wireless, USA * . . . . . . . $ 58 B ( $ 49 B) . . . Operator . . . . . 137br /5 (5) . . . . . . Telefonica Movil, Spain * . . . . . . $ 55 B ( $ 55 B) . . . Operator . . . . . 147br /br /6 (6) . . . . . . T-Mobile, Germany * #0160;. . . . . . . . $ 49 B ( $ 50 B) #0160;. . . Operator . . . . . 166br /7 (8) . . . . . . Orange Mobile, France * . . . . . . $ 48 B ( $ 47 B) . . . Operator #0160;. . . . . 173br /8 (2) . . . . . . Nokia Mobile, Finland * . . . . . . . $ 45 B ( $ 66 B) . . . Handsets . . . . . 188br /9 (21) . . . . . Apple iPhone, USA * #0160;. . . . . . . . #0160;$ 42 B ( $ 13 B) . . . Smartphones . . 205br /10 (10) . . . . Samsung Mobile, S Korea * #0160;. . . #0160;$ 40 B ( $ 38 B) . . . Handsets . . . . . 215br /br /11 (11) . . . . NTT DoCoMo, Japan * #0160;. . . . . . . $ 38 B ( $ 37 B) . . . . Operator . . . . . 226br /12 (9) . . . . . Telecom Italia Mobile, Italy * . . . $ 36 B ( $ 40 B) . . . . Operator . . . . . 245br /13 (13) . . . . America Movil, Mexico * . . . . . . $ 34 B ( $ 30 B) . . . . Operator . . . . .272br /14 (12) . . . . Sprint Nextel, USA . . . . . . . . . . $ 33 B ( $ 36 B) . . . . Operator . . . . . 289 **br /15 (15) . . . . Ericsson Mobil, Sweden * #0160;. . . . . $ 27 B ( $ 24 B) . . . . Networks . . . . 359br /br /16 (16) . . . . China Unicom, China #0160;. . . . . . . . $ 26 B ( $ 22 B) . . . . Operator . . . . . 370 **br /17 (18) . . . . Huwaei Mobile, China * . . . . . . . $ 25 B ( $ 19 B) . . . . Networks #0160;. . . . 390br /18 (14) . . . . KDDI Keitai, Japan * . . . . . . . . . $ 24 B ( $ 25 B) . . . . Operator . . . . . 405br /19 (23) . . . . RIM, Canada . . . . . . . . . . . . . . $ 20 B ( $ 11 B) #0160;. . . . Smartphones #0160;. 489 **br /20 (19) . . . . Softbank Keitai, Japan * . . . . . . $ 19 B ( $ 18 B) #0160;. . . . Operator . . . . . n/abr /br /21 ( n/a ) #0160;. . Google Mobile (+ Motorola) * . . . $ 17 B ( n/a ) .. . . . . . Handsets . . . . . n/abr /22 (20) . . . . Alcatel Lucent Mobile, France * . $ 16 B ( $ 16 B) #0160;. . . . Networks . . . . . n/abr /23 ( n/a ) #0160;. . Bharti Airtel, India . . . . . . . . . . . $ 14 B ( $ 9 B ) . . . . . Operator #0160;. . . . . n/abr /24 (22) . . . . SK Telecom, S Korea . . . . . . . . $ 13 B ( $ 12 B ) . . . . Operator . . . . . . n/abr /25 (24) . . . . Telenor Mobil, Norway * #0160;. . . . . . $ 12 B ( $ 11 B ) #0160;. . . . Operator #0160;. . . . . n/abr /br /Source: TomiAhonen Almanac 2012, the above table and data may be freely quotedbr /#0160;br /Notes:br /* indicates imaginary company, based only on mobile revenues, with imaginary name for the companybr /** indicates actual real ranking in Fortune Global 500 listing as it is a real company purely in mobilebr /Note also that the Google company incorporates Motorola Mobility unit revenues, but not other Motorola mobile revenues of its networking etc business.br /br /The top 7 companies in mobile are carriers/operators. The top 3 are not just from different countries, but based on different continents. And for Apple-watchers, not only has #39;Apple iPhone#39; jumped up massively on the list, Apple only making smartphones is almost as big as Nokia with smartphones, dumbphones and the mobile side of Nokia#39;s networking business, combined.br /br /The above chart is indicative and approximate, rounded off to the nearest one billion dollars. The currency fluctuations will impact quite heavily. But if you think about the real power and influence, real revenues, employees, etc, the above gives a good listing of who are the 25 biggest companies in mobile. And while some companies are often in the news, like say Microsoft, a big giant in the IT industry, by its mobile revenues, Microsoft isn#39;t even close to entering the chart. Similarly HP, which bought Palm (but has since discontinued that business) didn#39;t make it to the top 25. The pure smarpthone maker HTC sits just out of the chart and is likely to enter it next year. And the one company that was replaced from the 2010 list - Russia#39;s biggest mobile operator by revenues, MTS, was replaced by another BRIC company biggest operator - Bharti Airtel of India. We can expect in the future more and more of the newcomers on the list to come from Emerging World markets.br /br /Regionally, the biggest companies of our industry are now split so that 9 come from Europe, 9 also from Asia, 6 from North America and 1 from Latin America (but if you want to count Mexico as part of the North American continent as separate from the cultural division then 7 are from the North American continent).br /br /By nations of the Top 25, 5 of the biggest companies come from the USA, 3 from China, 3 from Japan, 2 from South Korea, and 2 from France. And to see how widely dispersed this industry is, those top 25 companies are spread across 15 different countries.br /br /About Apple - remember that this is #39;mobile#39; not #39;wireless#39; or #39;portable#39; so the iPhone is mobile, but other iOS devices, while they are portable like iPad and iPod Touch, they are not mobile devices, their services are not mobile, they do not #39;ring in your pocket#39; haha. Similarly for example notebook and netbook PCs are not counted for Lenovo or Samsung etc. This is strict definition mobile and for Apple that means iPhone and related revenues only (but does include iPhone App Store related revenues too)br /br /You may freely quote and repeat the above chart. And one note on profits. NO ! This chart took enough time from me. I am not going to try to calculate the proportional profits fairly by the about 50 or so companies that are the contenders for this top 25 list, and do that also for the profits. If you want to, go ahead. I have more important things to do, this blog is NOT a financial analysis blog. But as this blog is a mobile industry blog, it does make sense to put the big companies in context, especially across the operators, handset makers and infrastructure providers. Enjoy.br /br /PS a plug. The above chart is of course one of the over 90 tables and charts that are among the topics covered in the TomiAhonen Almanac 2011. The new Almanac 2012 will be released in late January or early February. If you buy the 2011 edition now, you will receive both Almanacs for the price of one. At only 9.99 Euros, the unrestricted pdf based ebook is formated for the smartphone screen so you can have the stats in your pocket every day. The TomiAhonen Almanac is the indispensible industry statistics volume for anyone working in this industry. a href=http://www.tomiahonen.com/ebook/almanac.html target=_selfTake a look at TomiAhonen Almanac 2011 edition/a./p

pspan style=background-color: #ffffbf; font-size: 8pt;On January 3, 2012, emstrongForbes/strong/em ran a story featuring the a href=http://www.forbes.com/sites/haydnshaughnessy/2012/01/03/who-are-the-top-10-power-influencers-in-mobile/ target=_selfTop 10 Power Influencers in Mobile/a around the world. Forbes measured the most influential mobile experts globally by Reach, Resonance and Relevance and rated me number 1, based on this Communities Dominate blog and my Twitter feed, my videos on YouTube etc. Thank you toemstrong Forbes/strong/em for the measurement, and thank you for my readers and followers and all who reference this blog and stories in it, for bringing me this incredible honor. I am humbled and I will endeavour to try to be worthy of that title to bring you, my readers more relevant and useful stories about mobile in the coming years. #0160;/span/p

pTo my regular readers..br /br /I had stopped adding the category info about the blogs as the word cloud was increasingly obsolete. I have now updated the world cloud topics. I am sorry, I deleted many topics that did relate to some early blog articles but are no longer really relevant. So some old topics are now gone. I have added many new topics (see on the left) and have gone back to January 2010 to start to use the new categories and am attempting to get all articles published since then updated to the new categorization. It will take me some time and obviously it will be imperfect as I will not attempt to read every article for that purpose. But I hope the new categories are more relevant to you in using this blog and the archived articles.#0160;/p