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Nokia was well on its way down before Elop. It's not fair to pin that on him. But, it did seem pretty clear (even then) that his turnaround strategy involved a

by mbreese 13y ago

Nokia was well on its way down before Elop. It's not fair to pin that on him. But, it did seem pretty clear (even then) that his turnaround strategy involved a Microsoft purchase.

AnthonyMouse 13y ago
I don't think you can call something a "turnaround strategy" when the result is to cause the company's value to nosedive so far that the most viable means to salvage any of their investors' money is to divest them of their stock at a significant loss. From the Nokia stockholder's perspective, even if by some miracle the company were to subsequently prosper under Microsoft, by that point they no longer own it, so how does that help them?
- mbreese 13y ago
  I'm looking at it from a "stop the bleeding" point of view. When he took over, Nokia's stock was a little less around $9... down from it's high of almost $40 3 year earlier. Things had somewhat stabilized, but it was clear that Nokia was no longer going to be the top tier phone maker they had been for a decade. The strategy at that time was to ditch their Symbian and Linux platforms and jump 100% into the Windows Phone world. When they starting making only Windows smartphones (not including feature or dumb phones here), if things didn't improve, the obvious exit for Elop and the Nokia board was a Microsoft buyout (plan B). Now that they are trading at less than $4, it's pretty clear that something isn't working, so they need to just skip all the presences and just join Microsoft. I'm not sure how Microsoft's own transition is going to play in this, but I bet that hurried up the deal a bit. So, the benefit for the shareholders is that they won't loose any more money than they already have. Microsoft has provided a decent backstop to stop the loss in value. Plus, I haven't seen what Microsoft is actually buying... they may end up leaving the backend infrastructure products as a separate company, which would probably leave shareholders with some value.
  - bad_user 13y ago
    When he took over, Nokia still had the in-house expertise and the resources for a turnaround. In fact Nokia N9 would have been a raging success, if Eliop wouldn't have killed it. And another thing: the feature phone business is huge and underserved by Android. Nokia was in the best position to come up with a reasonable alternative.
    - mbreese 13y ago
      When Elop was brought in, the board was clearly signaling that a turnaround from within was not going to happen. The Microsoft smartphone strategy was already in place and was going to happen. I have a lot of respect for Nokia, but they had the technology for the iPhone and iPad long before Apple (roughly), and they were never able to capitalize on it. Hell, I had an N770 in 2006 and it was great. But it wasn't even close to being finished enough for the masses. My fear with MeeGo was that it wasn't in the same league as the iPhone design-wise. Hardware-wise, Nokia has always been top notch. It's the mix of software and design where they seemed to be lacking. It might be that they may have put too much emphasis on open-source and Linux graphics at the time.
      - bad_user 13y ago
        Wouldn't it be absolutely embarrassing if Firefox OS ends up capturing 5-10% of the market? And personally I think it will, just like I knew Nokia is dead after announcing their new Windows Phone strategy. Nokia is a textbook example of things not to do. All the talk about them not being able to deliver the iOS polish / experience is simply not true. That's not what killed them. What killed them is that they focused on price and quantity instead of quality, coupled with schizophrenic business decisions. Example: Nokia closed their factory in Bochum, Germany to move to Cluj, Romania for cutting costs. Then they closed their factory in Romania, with the rumours being that they'll move to Moldova. They didn't of course, moving the production to China. The reason for these moves? Simple - in both cases Nokia took advantage of subsidies granted by governments / the EU, which are given as an initial incentive. At the time, the public opinion was like "oh, but Nokia is a big capitalist and they have a duty to their shareholders" and "China makes more sense for Nokia". Well, I find a sort of poetic justice in how things turned out for them.

by mbreese 13y ago

Nokia was well on its way down before Elop. It's not fair to pin that on him. But, it did seem pretty clear (even then) that his turnaround strategy involved a Microsoft purchase.

AnthonyMouse 13y ago

I don't think you can call something a "turnaround strategy" when the result is to cause the company's value to nosedive so far that the most viable means to salvage any of their investors' money is to divest them of their stock at a significant loss. From the Nokia stockholder's perspective, even if by some miracle the company were to subsequently prosper under Microsoft, by that point they no longer own it, so how does that help them?

mbreese 13y ago
I'm looking at it from a "stop the bleeding" point of view. When he took over, Nokia's stock was a little less around $9... down from it's high of almost $40 3 year earlier. Things had somewhat stabilized, but it was clear that Nokia was no longer going to be the top tier phone maker they had been for a decade. The strategy at that time was to ditch their Symbian and Linux platforms and jump 100% into the Windows Phone world. When they starting making only Windows smartphones (not including feature or dumb phones here), if things didn't improve, the obvious exit for Elop and the Nokia board was a Microsoft buyout (plan B). Now that they are trading at less than $4, it's pretty clear that something isn't working, so they need to just skip all the presences and just join Microsoft. I'm not sure how Microsoft's own transition is going to play in this, but I bet that hurried up the deal a bit. So, the benefit for the shareholders is that they won't loose any more money than they already have. Microsoft has provided a decent backstop to stop the loss in value. Plus, I haven't seen what Microsoft is actually buying... they may end up leaving the backend infrastructure products as a separate company, which would probably leave shareholders with some value.
- bad_user 13y ago
  When he took over, Nokia still had the in-house expertise and the resources for a turnaround. In fact Nokia N9 would have been a raging success, if Eliop wouldn't have killed it. And another thing: the feature phone business is huge and underserved by Android. Nokia was in the best position to come up with a reasonable alternative.
  - mbreese 13y ago
    When Elop was brought in, the board was clearly signaling that a turnaround from within was not going to happen. The Microsoft smartphone strategy was already in place and was going to happen. I have a lot of respect for Nokia, but they had the technology for the iPhone and iPad long before Apple (roughly), and they were never able to capitalize on it. Hell, I had an N770 in 2006 and it was great. But it wasn't even close to being finished enough for the masses. My fear with MeeGo was that it wasn't in the same league as the iPhone design-wise. Hardware-wise, Nokia has always been top notch. It's the mix of software and design where they seemed to be lacking. It might be that they may have put too much emphasis on open-source and Linux graphics at the time.
    - bad_user 13y ago
      Wouldn't it be absolutely embarrassing if Firefox OS ends up capturing 5-10% of the market? And personally I think it will, just like I knew Nokia is dead after announcing their new Windows Phone strategy. Nokia is a textbook example of things not to do. All the talk about them not being able to deliver the iOS polish / experience is simply not true. That's not what killed them. What killed them is that they focused on price and quantity instead of quality, coupled with schizophrenic business decisions. Example: Nokia closed their factory in Bochum, Germany to move to Cluj, Romania for cutting costs. Then they closed their factory in Romania, with the rumours being that they'll move to Moldova. They didn't of course, moving the production to China. The reason for these moves? Simple - in both cases Nokia took advantage of subsidies granted by governments / the EU, which are given as an initial incentive. At the time, the public opinion was like "oh, but Nokia is a big capitalist and they have a duty to their shareholders" and "China makes more sense for Nokia". Well, I find a sort of poetic justice in how things turned out for them.