7 ms·

Nokia is a perfect example of corporate arrogance: “we didn’t do anything wrong, but somehow, we lost” said the CEO at the time. Yet they did everything wrong.

thepangolino 7y ago
I’ll never forget how they jumped from a burning platform to a sinking ship.
- ossworkerrights 7y ago
  If they had the culture of acquiring up and coming start-ups, such as the one making Android, there would have been an excellent result. I fell like most EU based companies lack such culture, and the result is that once great companies face great failures (unless the EU bails them out or taxes their competitors).
- lerpoel 7y ago
  That jump, however stupid it was at the time, is the key to Nokia existing at all in its current form. The Nokia management used the Microsoft money to buy Siemens part of NSN (Nokia Siemens Networks) and managed to turn it around somewhat, in a situation where it looked like Ericsson and Huawei were going to be the only survivors. I was working for a subcontractor to Nokia during 2010-2016 and we were dumbfounded in the beginning, but as the years went on that turned into a belief that Nokia scammed Microsoft in that sale.
  - ahje 7y ago
    > a belief that Nokia scammed Microsoft in that sale That's what I've heard too -- They knew they were going down and simply took the opportunity to dump the handset business on Microsoft while securing funding to allow the network business to grow.
    - dx034 7y ago
      No matter who got the better deal, I wouldn't call it a scam if two billion $ companies agree on a price for a business after due diligence. Sometimes both win (because one can use the asset better than the other), sometimes the price is too high or too low. Doesn't mean they got scammed.
      - ahje 7y ago
        I doubt we'll ever get the full story of what happened, and how much Nokia told Microsoft of the state of the business that changed hands. But you are, of course, right; it could just as well have been a really, really bad business deal for Microsoft.
        ThrowawayR2 7y ago
        > "...it could just as well have been a really, really bad business deal for Microsoft." I think that's the more likely explanation. Remember that Steve Ballmer was crazy enough to also try to buy Yahoo, which would have been an even bigger disaster for Microsoft.
- pjmlp 7y ago
  The latest iteration of that burning platform, Symbian Belle with QT and PIPS was already quite an improvement, Symbian was getting quite good, being open sourced, with everyone slowly moving away from Symbian C++ (uggh) into Qt/PIPs. Paralel to that N900 was shapping up quite well, also using Qt as part of its SDK. Being asked to throw away their Symbian Java and Qt for Windows 7 pure .NET SDK was what made the large majority abandon ship. Naturally Elop was just driving Nokia into the position he could benefit from his compensation clauses given to him by the Nokia board.
- undebuggable 7y ago
  To be more accurate they jumped from a burning platform (Symbian) to a sinking ship (Windows Phone) while throwing away the lifebuoy (MeeGo).
  - raverbashing 7y ago
    Because the "old timers" though this linux thing was a toy and a fad and stuck to Symbian
  - jacobush 7y ago
    Depends on what you mean by Nokia. Nokia which is still around, cut off an arm to give it to Microsoft. The arm itself didn't fare very well...
  - Maxion 7y ago
    While Maemo/MeeGo was cool (Former N900 user here), I doubt it would have succeeded in the long term. It would have been equally difficult to entice developers as it was for the windows phone platform, putting Nokia in the same position as they were with WP.
mxschumacher 7y ago
given the performance of Nokia's share price in recent years, I find the website of the chairman corroborates your statement: https://www.paranoid-optimist.com/ https://www.paranoid-optimist.com/
Nokinside 7y ago
Nokia did everything right for a very long time. But when everything is great success, people behind that success shadow the people who could make success in the future. Netflix is great example of how to do big transition right. Netflix was in renting DVDs by mail business. When the decision to move to streaming was made, Netflix CEO did not allow managers who responsible for DVD renting business into meetings where the future was planned. People responsible for Symbian should have been locked out from all future planning. They were allowed to participate and of course they sabotaged–both intentionally and unintentionally–all big changes. Moving from hardware and embedded software world to full software platform mindset required completely different people.
- denzil_correa 7y ago
  aka Principal-agent problem https://en.wikipedia.org/wiki/Principal–agent_problem https://en.wikipedia.org/wiki/Principal–agent_problem
- scaryclam 7y ago
  Wow, was that as brutal as it sounds? Not necessarily wrong, I've seen the result of the "old guard" slowing down and missing the point of radial changes, but what happened to the people involved in the DVD rentals? Were they laid off? Or transitioned back when the major decisions and direction had been set? Just curious really :)
- timcederman 7y ago
  They were doing things wrong long before the iPhone was released, e.g. https://en.wikipedia.org/wiki/Nokia_7600 https://en.wikipedia.org/wiki/Nokia_7600
  - Nokinside 7y ago
    Nokia 7xxx was fashion and experimental series and not a sign of failure. They were used to test features and target specific consumer segments. In that era it was common to launch large number of different models each year. 3-4 different series and different models in each series. It was how the old hardware-centric model worked. The phone fashion changed from year to year and Nokia was constantly increasing the market share. When you move to smartphones as software platforms you produce basically the same phone hardware with 2-3 small variations. It was this transition that Nokia missed.
jillesvangurp 7y ago
I worked there at the time. Senior management is the reason this company went down. They did everything wrong at every strategic moment from the second early rumors about the iphone and android started swirling. And arguably a lot earlier when they chose Symbian over mobile Linux for the first time in the late nineties. This was when the early trend that Linux was heading for the embedded and mobile space were already bleedingly obvious to industry insiders. It killed Symbian touch screen OS after Apple iphone rumors got quite serious (2005) and then relaunched it in a hurry when it became clear that they were actually launching it. If you trace back Android's roots, you arrive more or less at a period where Symbian was still in the R&D stage and several companies were attempting a mobile linux. Android was one of them and was picked up by Google eventually. Around the time the iphone rumors got serious (2004-2005) was in the same time frame that Nokia's internal linux mobile OS showed promise. The n770 tablet launched in 2006 and featured Debian linux (complete with apt-get update and oss repos full of oss tools and software), x-windows, and a mozilla based browser. Yet this platform was never allowed anywhere near anything resembling a premium smartphone until 2012. Attempts to create a platform with mobile phone capability were consistently shelved for years. The reasons for this were entirely political. Maemo and later Meego were perpetually targeted at developer devices because it was considered a threat to Symbian. Projects to target premium phones with Maemo/Meego died over and over again. The N8 (cool metal design with a 13mp camera in 2010) actually started out life as a Meego phone but then turned into a Symbian phone (arguably one of the better ones) because management chickened out. If there ever was a chance for Nokia to make a move against Apple and Google; that would have been it. Never happened because senior management chickened out. The only proper phone that actually made it to market, the n9, was only launched after they decided to kill the whole platform and go for Lumia & MS. For that reason once more never got the benefit of Nokia's marketing and distribution reach. I can't stress enough the utter stupidity of repeatedly killing (multiple) smart phone platforms with full OSS browsers, awesome developer tooling, and all the multi media stuff you could ever want throughout the development cycles of Android and IOS. When the iphone finally launched they had nothing whatsoever worth shipping. The N97 mentioned in the article was gobbled together in a hurry and so bad that it allowed Apple and Google to rapidly claim marketshare. Attempts to fix Symbian amounted to too little too late and futile posturing. Throughout this, Meego was considered a threat rather than a solution and attempts to get it to market were frustrated with decisions to continue focus on Symbian over and over again. Meanwhile, Nokia continued to 'differentiate' with under powered devices with cheap CPUs and not enough RAM to shave a few dollars of a device that people did not want. A misguided deal to partner with Intel did not help either. Apple meanwhile correctly identified that margins on smart phones ought to be measured in hundreds of dollars and did not save pennies on materials, hardware, or bother crippling their own software to please the operators. Nokia did all of that. When Nokia got rid of their chip developers, Apple was planning to move CPU development in house. When Apple and Google chose capacitive touch screens, Nokia continued to ship crappy resistive touch screens, because they were cheaper. Technical ineptitude and penny saving is what killed Nokia. Bot Android and IOS were very limited platforms in their first years. IOS had no SDK in the first version at all and Android devices were a combination of slow and buggy and poorly designed. However, Nokia was a no show and gave them over half a decade to fix this before it eventually folded. Fun fact: a lot of the early Android development was actually done on N800's (Nokia's maego tablet launched in 2007; several years before the ipad): reason Android and Maego shared much of the kernel internals and Nokia was a big kernel contributor and because it was open source, booting another OS was easy and common on these devices. So, Nokia enabled Google massively with their awesome developer oriented devices, tooling, and kernel contributions that they just could not be bothered to target at consumers. Ultimately Google said thank you very much and launched Android and never looked back. This serial stragic blundering is what killed Nokia.
deleted 7y ago
[deleted]
Hamuko 7y ago
Anssi Vanjoki's 2007 commentary on Taloussanomat is pretty reflective of that. Here's a quick translation of that. Nokia's Multimedia director Anssi Vanjoki welcomes Apple into the mobile phone race. – Apple entering the market is a fantastic thing. It will bring forth more growth for the business, Vanjoki tells Taloussanomat. He thinks that Apple's phone is a sign that Nokia's multimedia direction has been correct since the beginning. Nokia was among the first to add multimedia features on phones. – This is evidence of us having the right direction since the start. Vanjoki is not expecting a significant blow to Nokia from Apple's phone. If Apple can hit its sales target of 10 million iPhones in 2008, it will have less than one percent of the mobile phone market. – Apple's target is not very high. Vanjoki thinks Apple is competing with the products of his directed Multimedia business. – Apple's iPhone is competing with our N series products. We just have a much wider array of prices, going from just under 200 euros to a thousand euros, Vanjoki says. – An interesting product, but it's missing several critical features such as 3G to enable fast data transmission. https://www.is.fi/taloussanomat/art-2000001490727.html https://www.is.fi/taloussanomat/art-2000001490727.html (in Finnish)
- distances 7y ago
  To be fair, it wasn't Apple directly that doomed Nokia's phone business, it was Android. Of course Apple set the gears moving with iPhone though.
shusson 7y ago
It's worth pointing out every other major phone company besides maybe Samsung also lost [1]. [1] https://bebusinessed.com/history/history-cell-phones/ https://bebusinessed.com/history/history-cell-phones/
hyperpallium 7y ago
It's curious, smartphones seem the greatest "disruption" of our time, but they don't fit Christensen's theory... and in fact he classified them as non-disruptive at the time.

thepangolino 7y ago

I’ll never forget how they jumped from a burning platform to a sinking ship.

ossworkerrights 7y ago
If they had the culture of acquiring up and coming start-ups, such as the one making Android, there would have been an excellent result. I fell like most EU based companies lack such culture, and the result is that once great companies face great failures (unless the EU bails them out or taxes their competitors).
lerpoel 7y ago
That jump, however stupid it was at the time, is the key to Nokia existing at all in its current form. The Nokia management used the Microsoft money to buy Siemens part of NSN (Nokia Siemens Networks) and managed to turn it around somewhat, in a situation where it looked like Ericsson and Huawei were going to be the only survivors. I was working for a subcontractor to Nokia during 2010-2016 and we were dumbfounded in the beginning, but as the years went on that turned into a belief that Nokia scammed Microsoft in that sale.
- ahje 7y ago
  > a belief that Nokia scammed Microsoft in that sale That's what I've heard too -- They knew they were going down and simply took the opportunity to dump the handset business on Microsoft while securing funding to allow the network business to grow.
  - dx034 7y ago
    No matter who got the better deal, I wouldn't call it a scam if two billion $ companies agree on a price for a business after due diligence. Sometimes both win (because one can use the asset better than the other), sometimes the price is too high or too low. Doesn't mean they got scammed.
    - ahje 7y ago
      I doubt we'll ever get the full story of what happened, and how much Nokia told Microsoft of the state of the business that changed hands. But you are, of course, right; it could just as well have been a really, really bad business deal for Microsoft.
      - ThrowawayR2 7y ago
        > "...it could just as well have been a really, really bad business deal for Microsoft." I think that's the more likely explanation. Remember that Steve Ballmer was crazy enough to also try to buy Yahoo, which would have been an even bigger disaster for Microsoft.
pjmlp 7y ago
The latest iteration of that burning platform, Symbian Belle with QT and PIPS was already quite an improvement, Symbian was getting quite good, being open sourced, with everyone slowly moving away from Symbian C++ (uggh) into Qt/PIPs. Paralel to that N900 was shapping up quite well, also using Qt as part of its SDK. Being asked to throw away their Symbian Java and Qt for Windows 7 pure .NET SDK was what made the large majority abandon ship. Naturally Elop was just driving Nokia into the position he could benefit from his compensation clauses given to him by the Nokia board.
undebuggable 7y ago
To be more accurate they jumped from a burning platform (Symbian) to a sinking ship (Windows Phone) while throwing away the lifebuoy (MeeGo).
- raverbashing 7y ago
  Because the "old timers" though this linux thing was a toy and a fad and stuck to Symbian
- jacobush 7y ago
  Depends on what you mean by Nokia. Nokia which is still around, cut off an arm to give it to Microsoft. The arm itself didn't fare very well...
- Maxion 7y ago
  While Maemo/MeeGo was cool (Former N900 user here), I doubt it would have succeeded in the long term. It would have been equally difficult to entice developers as it was for the windows phone platform, putting Nokia in the same position as they were with WP.

mxschumacher 7y ago

given the performance of Nokia's share price in recent years, I find the website of the chairman corroborates your statement: https://www.paranoid-optimist.com/ https://www.paranoid-optimist.com/

Nokinside 7y ago

Nokia did everything right for a very long time. But when everything is great success, people behind that success shadow the people who could make success in the future. Netflix is great example of how to do big transition right. Netflix was in renting DVDs by mail business. When the decision to move to streaming was made, Netflix CEO did not allow managers who responsible for DVD renting business into meetings where the future was planned. People responsible for Symbian should have been locked out from all future planning. They were allowed to participate and of course they sabotaged–both intentionally and unintentionally–all big changes. Moving from hardware and embedded software world to full software platform mindset required completely different people.

denzil_correa 7y ago
aka Principal-agent problem https://en.wikipedia.org/wiki/Principal–agent_problem https://en.wikipedia.org/wiki/Principal–agent_problem
scaryclam 7y ago
Wow, was that as brutal as it sounds? Not necessarily wrong, I've seen the result of the "old guard" slowing down and missing the point of radial changes, but what happened to the people involved in the DVD rentals? Were they laid off? Or transitioned back when the major decisions and direction had been set? Just curious really :)
timcederman 7y ago
They were doing things wrong long before the iPhone was released, e.g. https://en.wikipedia.org/wiki/Nokia_7600 https://en.wikipedia.org/wiki/Nokia_7600
- Nokinside 7y ago
  Nokia 7xxx was fashion and experimental series and not a sign of failure. They were used to test features and target specific consumer segments. In that era it was common to launch large number of different models each year. 3-4 different series and different models in each series. It was how the old hardware-centric model worked. The phone fashion changed from year to year and Nokia was constantly increasing the market share. When you move to smartphones as software platforms you produce basically the same phone hardware with 2-3 small variations. It was this transition that Nokia missed.

jillesvangurp 7y ago

I worked there at the time. Senior management is the reason this company went down. They did everything wrong at every strategic moment from the second early rumors about the iphone and android started swirling. And arguably a lot earlier when they chose Symbian over mobile Linux for the first time in the late nineties. This was when the early trend that Linux was heading for the embedded and mobile space were already bleedingly obvious to industry insiders. It killed Symbian touch screen OS after Apple iphone rumors got quite serious (2005) and then relaunched it in a hurry when it became clear that they were actually launching it. If you trace back Android's roots, you arrive more or less at a period where Symbian was still in the R&D stage and several companies were attempting a mobile linux. Android was one of them and was picked up by Google eventually. Around the time the iphone rumors got serious (2004-2005) was in the same time frame that Nokia's internal linux mobile OS showed promise. The n770 tablet launched in 2006 and featured Debian linux (complete with apt-get update and oss repos full of oss tools and software), x-windows, and a mozilla based browser. Yet this platform was never allowed anywhere near anything resembling a premium smartphone until 2012. Attempts to create a platform with mobile phone capability were consistently shelved for years. The reasons for this were entirely political. Maemo and later Meego were perpetually targeted at developer devices because it was considered a threat to Symbian. Projects to target premium phones with Maemo/Meego died over and over again. The N8 (cool metal design with a 13mp camera in 2010) actually started out life as a Meego phone but then turned into a Symbian phone (arguably one of the better ones) because management chickened out. If there ever was a chance for Nokia to make a move against Apple and Google; that would have been it. Never happened because senior management chickened out. The only proper phone that actually made it to market, the n9, was only launched after they decided to kill the whole platform and go for Lumia & MS. For that reason once more never got the benefit of Nokia's marketing and distribution reach. I can't stress enough the utter stupidity of repeatedly killing (multiple) smart phone platforms with full OSS browsers, awesome developer tooling, and all the multi media stuff you could ever want throughout the development cycles of Android and IOS. When the iphone finally launched they had nothing whatsoever worth shipping. The N97 mentioned in the article was gobbled together in a hurry and so bad that it allowed Apple and Google to rapidly claim marketshare. Attempts to fix Symbian amounted to too little too late and futile posturing. Throughout this, Meego was considered a threat rather than a solution and attempts to get it to market were frustrated with decisions to continue focus on Symbian over and over again. Meanwhile, Nokia continued to 'differentiate' with under powered devices with cheap CPUs and not enough RAM to shave a few dollars of a device that people did not want. A misguided deal to partner with Intel did not help either. Apple meanwhile correctly identified that margins on smart phones ought to be measured in hundreds of dollars and did not save pennies on materials, hardware, or bother crippling their own software to please the operators. Nokia did all of that. When Nokia got rid of their chip developers, Apple was planning to move CPU development in house. When Apple and Google chose capacitive touch screens, Nokia continued to ship crappy resistive touch screens, because they were cheaper. Technical ineptitude and penny saving is what killed Nokia. Bot Android and IOS were very limited platforms in their first years. IOS had no SDK in the first version at all and Android devices were a combination of slow and buggy and poorly designed. However, Nokia was a no show and gave them over half a decade to fix this before it eventually folded. Fun fact: a lot of the early Android development was actually done on N800's (Nokia's maego tablet launched in 2007; several years before the ipad): reason Android and Maego shared much of the kernel internals and Nokia was a big kernel contributor and because it was open source, booting another OS was easy and common on these devices. So, Nokia enabled Google massively with their awesome developer oriented devices, tooling, and kernel contributions that they just could not be bothered to target at consumers. Ultimately Google said thank you very much and launched Android and never looked back. This serial stragic blundering is what killed Nokia.

deleted 7y ago

[deleted]

Hamuko 7y ago

Anssi Vanjoki's 2007 commentary on Taloussanomat is pretty reflective of that. Here's a quick translation of that. Nokia's Multimedia director Anssi Vanjoki welcomes Apple into the mobile phone race. – Apple entering the market is a fantastic thing. It will bring forth more growth for the business, Vanjoki tells Taloussanomat. He thinks that Apple's phone is a sign that Nokia's multimedia direction has been correct since the beginning. Nokia was among the first to add multimedia features on phones. – This is evidence of us having the right direction since the start. Vanjoki is not expecting a significant blow to Nokia from Apple's phone. If Apple can hit its sales target of 10 million iPhones in 2008, it will have less than one percent of the mobile phone market. – Apple's target is not very high. Vanjoki thinks Apple is competing with the products of his directed Multimedia business. – Apple's iPhone is competing with our N series products. We just have a much wider array of prices, going from just under 200 euros to a thousand euros, Vanjoki says. – An interesting product, but it's missing several critical features such as 3G to enable fast data transmission. https://www.is.fi/taloussanomat/art-2000001490727.html https://www.is.fi/taloussanomat/art-2000001490727.html (in Finnish)

distances 7y ago
To be fair, it wasn't Apple directly that doomed Nokia's phone business, it was Android. Of course Apple set the gears moving with iPhone though.

shusson 7y ago

It's worth pointing out every other major phone company besides maybe Samsung also lost [1]. [1] https://bebusinessed.com/history/history-cell-phones/ https://bebusinessed.com/history/history-cell-phones/

hyperpallium 7y ago

It's curious, smartphones seem the greatest "disruption" of our time, but they don't fit Christensen's theory... and in fact he classified them as non-disruptive at the time.