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back to article Small pile of cash, dying platform: 2011 is bad news for Nokia

Nokia's results for 2011 show the company has shipped a million Lumia handsets and has cash in the bank, but other than that there's nothing good to report. The results (PDF, dull, dull, dull) show last year's operating profit of €2,070m turned into a loss of €1,073m, based on sales which were down almost 10 per cent compared to …

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FAIL

What can you expect after setting fire to your own platform? The new Nokia's windows phones aren't bad but they just don't have the strength and depth of handsets that they use to. The N8 and the E7 are starting to show their age a little and start starting to be difficult to find. Where are the placements for them? (I'd settle for an updated n900 though.)

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> (I'd settle for an updated n900 though.)

Like the N9? I've got one: very nice handset! You can't find it in the UK but you can order it on Expansys and they will ship you one from continental Europe (mine came from Germany).

Having said this, that's probably the last Nokia handset I will ever own.

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Anonymous Coward

Starting to show their age?

The N8 was behind the times when it was released, it's only saving grace was it was running sybian so there was nothing better in the range when it was booted out the door.

Still had/has a wicked camera tho.

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Anonymous Coward

The nokia lumia windows phone sold more than 1 million in 6 euro market in around 2.5 months. Why this is not mentioned in the article?

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Facepalm

In the 6 *biggest*, *richest* Euro markets and on the holiday season, with an undercut price and massive promotion, Nokia *only* sold 1 million Lumia 800.

Meanwhile, the N9, with a huge markup (to make up for the L800), on advanced markets like Khazakhstan and well-off countries like Portugal, with the CEO as good as ignoring it on all press junkets, having been declared dead even before it was launched, still seems to have sold 1.4 million.

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Coat

"running sybian"

Interesting. They must really have juiced up the vibrating mechanism.

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Anonymous Coward

1 million is peanuts compared with Apple and Android activations. Why do so few people point this put? Apple and Android activations do this every two days.

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Facepalm

Bearing in mind the volume for the last major product launch they had in a Q4 was 4 million phones for the very badly received n8, 1 million seems like a very small number. Especially when you consider that half of that one million were actually sold in Q1 2012, so that's actually comparing 4 million to 0.5 million. Not to mention the market is now ~65% bigger in Q4 2011...

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Facepalm

It's unsurprising that...

...Symbian isn't shifting - they've shitcanned all the development for it and basically signalled that if you buy one, yer on yer own, pal. That said, I just had a C7 returned to me from a user who's retiring, and it was a stark reminder that they can be damn good phones. Just picking it up it felt good - solid build, sleek, simple user interface, the users I have here who just want the effing thing to just work and pick up their email love 'em still.

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Unhappy

One important omission

Elop admitted that Symbian phones are being undercut by cheap android smart phones. In the short term that should be a bigger worry since it means they have less time to move to the new platform than they thought.

Not a great surprise when you publicly execute your main OS.

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Perhaps this is why Symbian Belle has been renamed to Nokia Belle

Because there won't be another one?

I just hope they leave it bugfixed enough to be usable so 3rd party support can carry on for a while. I've got an N8 which somehow doesn't have e-mail notifications no matter how much you fiddle with or reset the settings.

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Windows

@ Perhaps this is why Symbian Belle has been renamed to Nokia Belle

Nokia's Belle-end, I think.

Upgraded my N8 to the latest, greatest revision, and it's awful. Decides to 'chime' at me in the middle of the night for mo noticeable reason, and some apps no longer behave as they used to.

(In faireness, some apps now behave as they should've done).

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I wouldn't be surprised that you found it "awful". I've heard some of the iOS 5 QA builds were shit-in-a-can too...

There's no official release of Belle yet for existing handsets, so what you installed is a leak of a QA build of the firmware which has then been hacked, to a greater or lesser extent, by someone who cared more about turning on all the "cool stuff" than making a stable, usable phone. Also, the official upgrade installer is not part of these leaked firmwares, and it's this that does a lot of the work in making sure that your existing apps keep working (or that old versions of system components don't hang around and interfere with new apps).

The official release of Anna was pretty stable; I don't expect the official release of Belle to be any less so, and for the sake of a few weeks, I'll hang on.

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Windows

@ Kristian

No, kaveri, I downloaded it from 'apps - SW update' on the phone. Even that was a pain, 'cos I kept getting 'update failed' - I had to swtch the thing off (at risk of bricking it) and try again.

It WAS Anna, not 'Belle'.

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My apologies...

I did my Anna update originally with Nokia Software Update for MacOS X and had no problems. The Over-the-air updates were smaller, and made more assumptions about what was already on your phone, so that may be the cause of your problems...

If you've got access to a PC, I suggest getting Nokia Suite (make sure you've got the latest version!), and doing a full backup, resetting the phone and then re-install (from the support tab). It takes a while, but should solve most of your problems.

It seems that the Belle update will *require* a Windows PC - no Over-the-Air option will be offered, the install will involve a full backup, wipe and restore of the phone, and the current Mac Software Update tool doesn't have that backup feature.

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"t seems that the Belle update will *require* a Windows PC"

That alone is a sad indication of a system that is so screwed they can't implement a proper update.

Really, how much do you need to back up, and why can't it do that over the air then initiate the full reset/update/restore.

A massive FAIL and sadly not Nokia's first. How the mighty (and good phone producers) have fallen...

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My N8 does that but I know it is my email downloading. I am still using "Anna" and I am very happy with the phone. Great call quality and reception.

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@Paul

Don't complain, compared to a few year's back Nokia's Mac support has come on in leaps and bounds. Having to use BootCamp to update to Belle is a 'feature'.

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iOS upgrades also do a full backup, wipe, update and re-install. It may be the least efficient way to update the device, but it does guarantee that the system files you've got post-install are exactly what QA signed off on.

Nokia's Mac support has always sucked, although it has started to improve a lot in the last year since the software has been rewritten in Qt. For me, though, once Mac OS X's Bluetooth support settled down, the lack of a "PC suite" became much less of an issue for me.

Actually, on Bluetooth, it's ironic that Apple's own phone can't integrate with Mac OS X as seamlessly as my N8 can: if I want to get a picture from my phone onto my Mac, I can do it without taking the phone out of my pocket, all while leaving iTunes to do what it's supposed to do: play my music.

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Windows

Thanks, Eric for the heads-up.

"My N8 does that but I know it is my email downloading"

Should've thought of that. Bit of a pain as it wakes the missus at 4 Ack Emma, when she has to be at work at 7. She wants a couple of hours more sleep.. Get woken by a LOT of bad Finnish swearwords some days....(It's also a standby alarm. We need 3 because she sleeps, farts and snores like a trooper in bed!)

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OSX, Bluetooth & iPhone

I really miss BluePhone integration like I got with my SE k750i. I loved being able to write text messages on my Mac, and search them on my Mac (ditto calls and call history, and then there was the handy remote control app I could run on the phone). Though of course, iPhone/iTunes backup and restore is handy.

There's no reason Apple can't come up with something better than BluePhone, especially when Android phones could potentially be better integrated with your mac than an iPhone.

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FAIL

Is ANYONE surprised?

Elop's entire smartphone strategy seems to have hinged upon all their high-end customers being dumb enough to blindly switch to WinPho just because it still has a Nokia badge on it. So, when it came to upgrading their N8/E7s they've either kept them or bought a Galaxy S instead. What a surprise!!

Epic. Fail.

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FAIL

Not surprised, Nokia's brandname is nearly gone now

Customers aren't very loyal these days. Nokia had disappeared in the US market for a year before coming back this month with basically what amounts to a low end Tmobile Winmobe. For the average consumer in the States (ala not us reading the Reg and keeping tabs) it looked like Nokia went bankrupt and disappeared for good. Then there is the issue Nokia for the most part was only low-end feature phones in the US anyway, so it releasing higher end Smartphones aimed at *average* consumers is like Hasbro doing it. They probably should've invented a new/crazy name for the US market to distance themselves from the low-end Nokia perception. Outside of my techie friends/coworkers, nobody knows Nokia ever produced anything other than the very popular little feature phones.

Meanwhile in the last year Samsung came out of nowhere and dominated the non-Apple US market filling some of the Nokia void as many feature phone folks upgraded to smartphones. The current defacto flagship Winmobes are from Samsung and HTC, so I still can't figure out what Nokia is doing. I still think MS is just hanging them out to dry while placing their real Winmobe hopes on Samsung and HTC.

Its almost like watching what happened with Apple/IBM when they started working together on a OS/2 and MacOS replacement (Taligent/Pink) that would run on everything. By the time Apple figured out it was about to get whacked by IBM's bureaucracy, it HAD been whacked by IBM's bureacracy. :) Kinda wonder how long it'll take Nokia to figure it out.

(need an "Epic FLAIL" icon for this one)

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strange words

What are these strange words "ala" and "defacto"? And how does one ork a cow?

-A.

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Anonymous Coward

New/crazy names don't work...

Interesting. I definitely agree that consumers are not loyal anymore (nor should they be).

But I don't think Nokia changing their name in the US would work - for one thing its been tried before by Philips (Magnavox in the US) and others with little success. The bottom line is that Brand quality is more heavily influenced by the substance of the products than the other way around.

Consumers aren't dumb - or they don't stay dumb forever;-) and they tend to pick based on their needs and sense of value. People (especially Product Developers) often think this sense of value is wrong because it ignores what they consider important, say features or technical specs.

But actually consumer markets are pretty good at spotting the product that offers them what's important to them. The trouble is, the balance of their priorities, between features, specs, style, affinity etc, change often, making it tough for companies to keep up.

Bottom line: Nokia phones have been behind the times in the things consumers consider important. We might love feature X of Symbian but consumers don't give a toss. Changing a name won't do.

And similarly don't expect the current leaders to stay in the lead if they fail to keep up with consumer priorities. Apple spent a long time as a tiny nice supplier of nice products and Samsung was considered a low end phone maker for almost as long because they were failing to match consumer desires. Nokia could rebound on the back of Windows Phone or fail utterly, but it will depend on a combination of what they do and what MS does.

I seriously doubt MS is placing their hopes on HTC and Samsung though. These two are THE champions of Android and MS did just pay $250m to Nokia...

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Pint

@dcaxax

Well said. Totally agreed on most points, except the last. :)

I'll explain about the last bit on MS with relation to HTC and Samsung. With MS paying 250 million to Nokia, no, it doesn't make sense, and with HTC and Samsung doing well with Android it doesn't make sense. However Nokia pinning all its hopes on a single supplier doesn't make sense either. MS doesn't have all its eggs in Nokia, and Nokia can disappear entirely and its a rounding error on MS's balance sheet and sales of Winphone would continue anyway. All the while MS doing Elop a personal favor by giving him the gift of CEO on his resume. However, getting ahold of those patents is worth substantially more than MS has shelled out so far, so in that regard it makes perfect sense for MS to tank Nokia, grab the patents, and leave Winphone with HTC and Samsung. Both of which are keeping multisupplier should something go wrong with the Android strategy. In Samsung's case, they're keeping triple sourced as they've got Bada as well. 1st rule in biz is always have a fallback supplier plan. The only mfg effectively without one right now is Nokia.

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Anonymous Coward

Very interesting

@admiraljkb

Thanks, that was a very insightful comments - if in 2 years Nokia is going down the drain and MS steps in to buy the patents, we'll know you're right.

I believe there may even be grounds for legal action by shareholders, though its very unlikely...

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Pint

@dcaxax

Yep, only time will tell whether that is "crop circle crazy" for theory or not. :) Personally I'm finding the whole situation very very strange (and suspicious) though from a corporate and engineering sense.

*If* I'm right, the stockholders probably won't have anything left to sue when its over though.

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Anonymous Coward

WID SOS

You know how the TV show DIY SOS occasionally features some clown of a Currys.digital salesman who's bought a 4lb hammer and a small bag of pre-mixed cement from B&Q and decided to affect widespread structural changes to their house, including knocking out several structural walls, leaving the whole family living in a hovel that could well completely collapse on top of them any second now. Then Nick Knowles & Co go in to save the day for the sake of the children?

Well, basically, that's Nokia, innit.

Except there ain't no Nick Knowles.

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Windows-Phone-based Lumia isn't selling as fast as hoped

Wow - when you consider they're giving it away at Walmart that must be a worry.

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I saw my first one yesterday, in a phone shop in Berlin. Well, a plastic empty one under a poster. "What about this" a girl was saying. "You don't want that" the man in the shop said, and pointed her to the Galaxy display.

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Anonymous Coward

It's about to get a whole lot worse for Windows Phone 7.

My insider contacts tell me that HTC are dumping Windows Phone 7 and concentrating on Android, with an announcement to that effect very soon. In addition Samsung will be too (but also supporting Bada).

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Trollface

really?

Oh god, an anonymous source quotes an anonymous source in anonymous internet posting quoting unsubstantiated information... the world quakes...

My arse.

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"HTC are dumping Windows"

While was an easily predicted outcome if Microsoft really did give Nokia an insider advantage, I still suspect it rather depends on the terms of their patent licence with Microsoft. It wouldn't be the 1st time Microsoft made an offer that couldn't be refused (the PC 'tax' for example) and they're happy to do the damage today and argue the legalities years later in court.

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MrF
Facepalm

None of which is news, really...

For more than a year, it's been an open secret that both Samsung & HTC are pretty well fed-up with wasting time and resources on Windows Phone. That's why they keep giving it short shrift in several areas, not leastways in hardware. The only reason they are still in the WP game is to share in the buckets of 'promotional agreement' cash doled out by MS, annually.

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Windows

It's the Curse of Microsoft

see above

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Anonymous Coward

Not sure which is worse...

Having to give them away, or having to use Walmart, as that's where the braindead shop...

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I've shopped in Wallmart ...

Ok it was only the once, and I was on holiday in the US at the time, so I was looking for the American Experience :-)

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@John G Imrie

I'm so sorry that you had to experience that on holiday. Walmart is NOT the normal American Experience. (or at least I hope not, eeeeeeeeeeeewwwwwwwww)

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Facepalm

I'm surprised

I thought Nokia would be sunk by now.

The new phones and the OS are decent, but Elop has done massive and un-nesessary damage to the company, why is he still employed there?

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Why?

Microsoft did chip in $250m in "platform support payments"...

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Holmes

Nokia:

"In certain markets, there has been an acceleration of the anticipated trend towards lower-priced smartphones with specifications that are different from Symbian’s traditional strengths."

English:

"People are buying other phones, that are cheaper and better."

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MrF
Facepalm

...all of which Elop (and everyone else) acknowledged 12 months ago.

So, the question remains: what are Nokia planning to do about it?

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Anonymous Coward

Whats Nokia going to do about it?

Have yet another reorg!!! Which is why there are mass redundancies. I've worked there for almost four years and am glad to be getting out next week. I just hope they have enough reserve cash for the redundancies as people choose to go somewhere with prospects.

Nokia has to be one of the most paralysed cultures I've ever seen. They sold of the Symbian Devs to accenture and even now aren't listening to thier concerns or their ideas. I can't see Nokia surviving for much longer.

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Pint

re: Whats Nokia going to do about it?

Same thing every corporate entity does in that situation (ordering may not be right, feel free to rearrange for own purposes):

10) Call extra meetings to discuss strategy (only to have similar meetings at a higher level overide your meeting)

9) Executive leadership team goes to Caribbean for a week for a top level "retreat"

8) Find successful group of employees, lay them off first.

7) On campus Teambuilding exercises

6) Dismiss CEO/Chairman with golden parachutes

5) Declare Bankruptcy and restructure

4) Early Retirement packages

3) Additional performance management metrics and reporting tools (really intrusive for bonus points)

2) Hire more Managers while laying off worker bees.

and the top number 1 answer:

1) The Beatings Will Continue until Morale Improves!

(beer icon because this should be a drinking game!)

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Thumb Up

Sounds familiar...

...but you forgot:

Hire Senior Execs from other companies with a vague strategic objective to transform the company in area "X" and then do everything possible to undermine them, thus preparing the ground for their ignominious exit. After, they declare victory in area "X" and appoint a run of the mill insider to manage it.

Any poor suckers who join Nokia today for a strategic position have just flushed their career down the toilet...

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Windows

You couldn't be more correct!

In my case flown over from England to Oulu for a week, just to corret a trivial software error (which I'd already done in UK - and proved it) "We want to make sure" Cost? about £2,000.

Flying the UK design team to Finland, so we could travel to Sweden and back on the ferry (Love boat, as it's known) so we could basically get laid (sole function of the boat, I suspect).

To justify, we had a 30-minute meeting.

Simply bleeding money!

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Silver badge

combined with the Facebook results

We don't know if they can't make them fast enough or if the channel is full and not buying, which has a major effect on guesstimates... though maybe it's both and shipments are falling of a cliff right now!

Anyway... the most optimistic projection is Nokia have 1m of that 1.3m Facebook count and Nokia have jumped straight to 1st place against HTC&Samsung. In reality a guesstimate that half the handsets are still in a warehouse and only half the Lumia users were counted @FB would still look good for a 3month vs >12month share, with Nokia still grabbing the biggest share of the small WP7 pie monthly sales. Maybe the Nokia brand is actually still working for them?

I actually think a lot more than 50% are still in the warehouse, that most Nokia fans have either bought one already or never will, inflating the 1st quarter sell through. I suspect Nokia are at rough parity with the others, just keeping up with handsets the others don't seem to promote or even want to sell.

The USA is going to be so much worse, with no brand recognition and a history of failure. Trying to break America is both a sign of desperation and a clear indicator of who's really in charge - Microsoft can't be seen failing in their home market and will send Nokia to their death trying to break in.

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Numbers

As I understand it, there were 1 million WP7 users on Facebook before November (before there were Nokia WP7 phones out), and there are 1.3 million now. And some of the added 300000 WP7 users are using WP7 phones from vendors other than Nokia. So there are quite a few Nokia WP7 phones that have been shipped, and not sold.

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Terminator

No-one's commented on this yet...

"...and Nokia is making lots of noise about its "Location & Commerce Business" which is behind the spread of Nokia Maps. Those will be replacing Bing Maps across Microsoft's portfolio, pushing the Nokia brand onto the screens of competitors' handsets which could prove controversial."

So the gutting has already begun. Rip out the best cuts and throw the offal to the dogs.

MS is waiting till Nokia is fully beaten and unconscious, so it can rifle through it's pockets and retrieve all that IP for dirt cheap.

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