Broken: "There is no alternative to Windows" says Nokia's Elop as investors mull his defenestration
May 9, 2013
Elop gave the "full steam ahead and damn the torpedos" spiel at Tuesday's Nokia AGM in Helsinki and a joyous occasion it was with investors baying for his blood - or at least, resignation.
Shareholder after shareholder lined up to tell Stephen Elop to change their company's strategy but were stonewalled by a CEO who seems mesmerised by an evangelical vision of Windows that is invisible to almost anyone else apart from Steve Ballmer. But then Elop did used to work for Microsoft and the Redmond brainwashing seems to have taken permanent root.
It was back in 2011 that Elop decided that Windows was the way to go. He unceremoniously dumped Nokia's very own Symbian OS and promised a smooth and easy two-year transition to Windows Phone. In the event the road has been bumpy, lumpy and grumpy. (No doubt the remaining four of the Seven Finnish Dwarves will turn up in due time).
Now, my admittedly basic skill in arithmetic tells me that those two years are over but Nokia is still playing third-fiddle to Apple and Samsung, two companies that continue to eat Nokia's lunch on a depressingly regular basis despite all the hoo-hah about the "success" of Nokia's Lumia handset suite.
Sales of other Nokia phones continue to decline along with the company's share price. In 2000 Nokia shares were worth €65 now they are trading at below €3. The market knows the score and tells it like it is, which is more than Stephen Elop is doing.
This is what the CEO told investors with reference to his insistence to cling on to Windows Phone software at any cost - or at least the shareholder's cost. "We make adjustments as we go. But it's very clear to us that in today's war of ecosystems, we've made a very clear decision to focus on Windows Phone with our Lumia product line and it is with that that we will compete with competitors like Samsung and Android."
In other words, all Nokia's eggs will stay in one basket. Heaven help the company if Elop eventually falls as he totters and teeters on his merry way to corporate oblivion.
He's also betting the company shirt on Lumia handsets. Sure, they have been comparatively successful in comparison to some of the dogs Nokia set running over the past few years only to see them keel over and die at the first bend in the road.
Nokia claims to have sold 5.6 million Lumia handsets in Q1 of 2013. During Q4, 2012 it sold 4.4 millon. Good figures you might think but the pale into insignificance alonside the likes of Apple and Samsung. The latter two have well over half the global market between them. Nokia has just under five per cent. How on earth can it claw its way back from there under the leadership of a CEO with tunnel vision? The Lumia sales simply are not strong enough for Nokia to do it.
Look at the reality. According to estimates from Reuters, Apple sold 36.9 million iPhones in Q1 this year whilst Samsung, thanks manly to its Android-based handsets 61.6 million smartphones in the twelve weeks from the start of january and the end of March this year. And let us remember that Samsung is but one of many maker of Android powered handsets.
Add to that the fact that Nokia fled the US market with its tail between its legs long ago and has never since succeeded in re-establishing a meaningful presence Stateside and the scale of its problems become even more apparent.
There's a management vacancy at Manchester United due to be filled in the next few weeks. Perhaps Steve can go there and have a go at ruining that. Mind you, consumer feedback would be instant and in basic Anglo-Saxon. Don't think he'd care for it. It's quieter in Espoo - at the moment.
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