Nokia will release its first Windows Phone-powered handset before the end of the year but only to a handful of countries. The partnering of the world’s largest mobile phone maker and Microsoft, the world’s biggest software company, has been much anticipated, but the Finnish company decided to forego an up-scale global launch.
Nokia CEO Stephen Elop said in a statement that adopting Microsoft’s smartphone operating system represented a significant change of direction, which required all strategic decisions to be thoroughly planned.
Also playing in the marketing strategy is its existing Symbian operating system, which still has a strong presence in certain markets. While joining forces with Microsoft undoubtedly tolled the death knell for Nokia’s in-house OS, the company does not want to undermine itself by eating into existing market share.
"Very Deliberate" Release
"We're very thoughtful about how we first launch Windows Phone relative to where Symbian is strong so we get the right balance and right dynamics,” said Elop. “We're being very deliberate, starting in certain markets, expanding again, continuing to expand and really having it blossom through the course of 2012.”
Elop promised noticeable differentiation from what has become the smartphone norm with Android and iPhone domination, and even compared to other Windows Phone devices.
"We have strengths in design, in hardware and mechanics, and a variety of other things, and we're going to be quite proud to show our work in that area,” said Elop. "This is our first foray into the Windows Phone space. You'll see our first signs of differentiation and our ability to differentiate clearly increase with time as we can more directly impact the software release cycle and so forth with our partners at Microsoft.”
The first Nokia Windows Phone prototype was unveiled at a conference in Singapore last summer, but Elop gave away no details on specifications or features, save for the moniker Sea Ray.
The past year has been challenging for Nokia, which has seen its global mobile phone market share slip to around 24% from its 2008 highs of over 40%. The company has struggled to take the smartphone fight to rivals Apple and Samsung, posting a second-quarter net loss of $512 million, compared to $321 million profit in the same period last year.
Last month Nokia announced it would be cutting 3,500 jobs and closing a factory in Romania as part of a $1.4 billion restructuring plan that has already seen 7,000 jobs axed.
The Finnish contingent is not alone in hoping the new Nokia Windows Phone will spark a revival – Microsoft also needs to kick start its smartphone campaign. CEO Steve Ballmer said earlier in the month he was unsatisfied with Windows Phone sales, which were sitting around 1.4 million units year-to-date – far below Apple and Android figures.
Speaking at the Web 2 Summit in San Francisco earlier in the week, Ballmer said he was looking forward to a “bunch of new devices running Windows Phone” at the annual Nokia World event on October 26 in London.
Key Statistics – World Smartphone Sales (source: Gartner)
- Global mobile phone sales to end users reached 428.7 million units in Q2 of 2011, a 16.5% year-on-year increase.
- Second-quarter smartphone sales jumped 74% compared to Q2 2010, accounting for 25% of total mobile handset sales, or 17% higher than last year.
- Nokia sold the highest number of mobile handsets in Q2 with almost 98 million units, representing 23% of total sales; Samsung, LG and Apple were next in line.