My concluding remarks would be...unfortuatnely I don't see much bright side for suppliers...but I think if and when Nokia decides to move its business beyond conventional phones, that would be very interesting to watch...remember a lot of consumer devices we see on the market will inevitably be connected to Internet...
Okay, as we get to the end of this Live Chat, I would like to see if Junko has some concluding remarks related to the central question of this session: What impact will further deterioration in Nokia's market position mean for its suppliers and contractors?
@WB: both companies need to increase business and are not in overlap of the market, currently they have quite complementary products, so a marge could automatically increase biz and new frontiers for suppliers too. They are only my thoughts....
but truth to be told, a lot of those good looking android phones'quality is less than optimal. some even said, if they had to buy the third phone (because the first two smart phones didn't work well) they should have bought iPhone in the first place
Unfortunately, I see it the only way Nokia can take the share of the cake. By lowering down prices otherwise Iphone and other android products are just too attractive to users and they wont like experimenting with Nokia at similar prices
Increasingly, companies like Apple are differentiating themselves not just on the look and feel of the products but also in the hardware inside. Apple has its own inhouse chip design teams and even in displays it makes sure it can differentiate itself. If a supplier cannot be assured of sales specific to Nokia, for instance, it would not vote capex for that program.
Bolaji: As long as there are legacy systems, suppliers should hang tight. Plus, there are few companies that can afford to abandon even their struggling OEMs. I think it depends on whether they will havet o invest in new capabilities to support Nokia
The one thing Nokia has going for it is that it is still considered a leading mobile player (outside the US) and may still have siginificant brand loyalty. If the company can hang on to that and rollout innovative Win-Nok devices, it may be able to regain its foothold...but it will be tough to compete in the high-end smartphone market
@Bolaji @Wale: Because Nokia and RIM are two different issues, two different companies. Saying they are in the same sinking boat is like saying two kids who are not doing well at some point at school will both be failures for the rest of their lives. Things can always change, in humans, or in companies.
Junko, If I look at the landscape and wonder what Nokia should do next, I would say it is time for it to do one of two things as a short-term measure: First, embrace Android. Second, consider being acquired by Microsoft (bad idea.) The third possibility is for the company to not follow the leader and break out like Apple into some other areas.
@Junko: I mostly agree with your viewpoints. I also like your thinking. I share the view that Nokia might reinvent itself, as so many times before. My idea of the fall of Nokia points at the actual leadership, most precisely at Elop. I truly believe if Elop would be the one leaving Nokia, the company would revive like a Phoenix. What do you think of this?
@Junko - Can you please tell us, would nokia continue with
It can reinvent itself as you pointed out but I also think that the market is too dynamic for the kind of cost-cutting reorganization it is doing. That won't be enough to help it regain market share. It didn't work for Motorola Mobility.
The bottom line of the current situation it seems is that suppliers to Nokia are going to get hammered for the next few years. As Nokia's sales have been falling so have the fortunes of these companies. That's going to remain the case for the companies that stick with Nokia through all these.
I would go back to something Junko said earlier about how Nokia has reinvented itself several times in the past. We should note that Apple did the same. The company is not merely a PC vendor anymore. It has changed dramatically into a consumer electronics company. If Apple can do it, perhaps so can Nokia. The question, though, is which market should it be looking at.
@Junko, where is marekt strenght for Double sim-card phone presently?
Junko, My questions are
1. Can you say that Nokia and RIM are in the same sinking boat today?
2. Can the suppliers adopt the same policy of "Share of business" as the buyers to spread thin their business risk when one of their buyers suddenly goes bust?
3. Is Nokia's survival as a company is solely dependent on its continued sucess in Mobile business or there are some other supporting businesses?
First, what does the current situation at Nokia mean for its suppliers and contractors
I think many suppliers would be scared to keep long term agreements with Nokia as its future isnt bright. Distributors wont like to buy too much stock and would prefer something sort of just in time
Junko, I have to open this up to our readers in a few minutes but I want to ask two key questions in the meantime. First, what does the current situation at Nokia mean for its suppliers and contractors and second, what does/can Nokia do to get back on track?
@WaqasAltaf: you are right, as consequence people have decided to buy products from FarEast, for example and cheaper smartphone, despite the quality; I am wondering if this is an additional cause for putting Nokia in trouble.
Wouldn't you contribute the lack of a well defined App Store use and developer experience as part of Nokia's issue...Apple had the iTunes platform to leverage and provided a revenue stream for developers and a easy, simple, but powerful App platform??
It's really important for this discussion for participants to hold questions and all comments unless absolutely necessary until we've opened the floor. I would like to do this in about 10 minutes but Junko has to set the stage with her introductory remarks. Please hold all questions and comments for now. Thank you.
I have a question for Junko/Bolaji (and everyone of course...): aparte Apple, it seems market leadership is currently for vendors which are focusing on products instead of products+OS; is it a possible key for explaining good position achieved by Samsung in front of Nokia difficulties a much effort from them spent in products and OS?
@JUnko: Before being a paper business, Nokia manufactured rubber boots, that was the very start of Nokia. As you said very well, Nokia has reinvented itself many, many, many times; and it might do it again. (Sorry, Bolaji, I had to reply to her Q)
I would like to see the Microsoft-Nokia partnership succeed and provide more options in the mobile space. The Lumina devices look nice...but Microsoft is releasing it's new Phone 8 platform in the Fall of this year. The upgrade is so dramatic that the new Lumina devices that are out now will not be able to utlize the Microsoft OS.
Junko Yoshida has been covering the electronics industry for more than 20 years and spent a major part of that period reporting on the consumer electronics industry. She has been reporting on the companies that manufacture the products as well as their components suppliers. She was until recently editor in chief for print and online at EE Times and has recently assumed the position of chief of international correspondents for the publication. Junko is well positioned to comment on the industry.
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