1605 new nokia smartphone deck
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Transcript of 1605 new nokia smartphone deck
The New NokiaFebruary 9, 2011 – Stephen Elop’s burning platform memo goes public. Nokia’s smartphone steps off a cliff. Carrier relationships are burned as they were committed to Maemo operating system to replace Symbian. Windows is used instead, built-in Skype alienates carrier relationships. A brief flirtation with Android showed up the poor sales performance of its Windows handsets. Rounds of cuts and market share losses forced Nokia to sell its handset business to Microsoft. May 19, 2016 – Nokia feature phones and smartphone business is sold to a combined Chinese / Finnish business consortium. The market is now very different. What chance do they have?
Why Microsoft got rid of ‘Nokia’
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2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Microsoft OS % of smartphone market
Microsoft OS % of smartphone market
Data: TomiAhonen Consulting (May 2016)
Nokia brandUsing Google as a proxy • Decline in brand interest over
past 12 months within mobile phone category 37%• Nokia still has comparable
brand equity to the likes of Motorola and BlackBerry• It’s level of brand equity looks
competitive with value-oriented Chinese brands
• It would be difficult to move Nokia into the premium Android sector without significant brand investment• Which would negate the primary
reason for purchase
Google searches as a proxy for residual brand equity
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23Au
g 30
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6Se
p 13
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20Se
p 27
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4O
ct 1
1O
ct 1
8O
ct 2
5No
v 1
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8No
v 15
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22No
v 29
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6De
c 13
Dec
20De
c 27
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3Ja
n 10
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17Ja
n 23
Jan
30Ja
n 31
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7Fe
b 14
Feb
21Fe
b 28
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6M
ar 1
3M
ar 2
0M
ar 2
7Ap
r 3Ap
r 10
Apr 1
7Ap
r 24
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Relative interest over past 12 months (mobile phone category, Google Trends)
Nokia Huawei Honor Lenovo OnePlus Oppo Motorola BlackBerry HTC
Nokia still has similar brand equity to other legacy brands
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7Ju
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26Au
g 2
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9Au
g 16
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g 30
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6Se
p 13
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20Se
p 27
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4O
ct 1
1O
ct 1
8O
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5No
v 1
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8No
v 15
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22No
v 29
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6De
c 13
Dec
20De
c 27
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3Ja
n 10
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17Ja
n 23
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30Ja
n 31
Feb
7Fe
b 14
Feb
21Fe
b 28
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6M
ar 1
3M
ar 2
0M
ar 2
7Ap
r 3Ap
r 10
Apr 1
7Ap
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ay 8
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Relative interest over past 12 months (mobile phone category, Google Trends)
Nokia Motorola BlackBerry
Brand equity is comparable to ‘value’ smartphone brands
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May
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May
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June
7Ju
ne 1
4Ju
ne 2
1Ju
ne 2
8Ju
ly 5
July
12Ju
ly 19
July
26Au
g 2
Aug
9Au
g 16
Aug
23Au
g 30
Sep
6Se
p 13
Sep
20Se
p 27
Oct
4O
ct 1
1O
ct 1
8O
ct 2
5No
v 1
Nov
8No
v 15
Nov
22No
v 29
Dec
6De
c 13
Dec
20De
c 27
Jan
3Ja
n 10
Jan
17Ja
n 23
Jan
30Ja
n 31
Feb
7Fe
b 14
Feb
21Fe
b 28
Mar
6M
ar 1
3M
ar 2
0M
ar 2
7Ap
r 3Ap
r 10
Apr 1
7Ap
r 24
May
1M
ay 8
May
15
Relative interest over past 12 months (mobile phone category, Google Trends)
Nokia Honor OnePlus
Doesn’t stack up so well against Greater China premium smartphone brands
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120
May
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May
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June
7Ju
ne 1
4Ju
ne 2
1Ju
ne 2
8Ju
ly 5
July
12Ju
ly 19
July
26Au
g 2
Aug
9Au
g 16
Aug
23Au
g 30
Sep
6Se
p 13
Sep
20Se
p 27
Oct
4O
ct 1
1O
ct 1
8O
ct 2
5No
v 1
Nov
8No
v 15
Nov
22No
v 29
Dec
6De
c 13
Dec
20De
c 27
Jan
3Ja
n 10
Jan
17Ja
n 23
Jan
30Ja
n 31
Feb
7Fe
b 14
Feb
21Fe
b 28
Mar
6M
ar 1
3M
ar 2
0M
ar 2
7Ap
r 3Ap
r 10
Apr 1
7Ap
r 24
May
1M
ay 8
May
15
Relative interest over past 12 months (mobile phone category, Google Trends)
Nokia Huawei Lenovo Oppo HTC
The new Nokia will be forged a brutal crucible• Saturation and lengthening
replacement times in developed markets• Steep decline in growth of
smartphones• Move towards customers who
can require lower price points• On top of hyper-competition
driving razor thin margins and little chance of differentiation in the Android eco-system
• At first glance, the New Nokia has little different to offer
Global smartphone ownership
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Data from Pew Research Spring 2015 Global Attitudes survey Q71 & Q72
% of survey respondents who claim to own a smartphone
Global mobile device units – moving from growth to mature market status
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Sales units (millions)
units (millions) tablets units (millions) smartphones
Data: GfK/CTA Digital World via Consumer Technology Association ‘Technology World Tour’ by Steve Koenig January 2016
Global mobile device units – declining growth
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2011 2012 2013 2014 2015 2016
Sales units (YoY % change)
units (YoY % change) tablets units (YoY % change) smartphones
Data: GfK/CTA Digital World via Consumer Technology Association ‘Technology World Tour’ by Steve Koenig January 2016
Global smartphone units by geography – lower margins available in emerging markets
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2010 2011 2012 2013 2014 2015 2016
Sales units (YoY % change)
Developed market (% units) Emerging markets (% units)
Data: GfK/CTA Digital World via Consumer Technology Association ‘Technology World Tour’ by Steve Koenig January 2016
Global mobile device ASP (USD) – steady decline in progress
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2010 2011 2012 2013 2014 2015 2016
Average selling price
Tablet USD Smartphone USD
Data: GfK/CTA Digital World via Consumer Technology Association ‘Technology World Tour’ by Steve Koenig January 2016
Global technology sales (revenue) geographic split – markets where the Nokia name still has brand equity
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2012 2013 2014 2015 2016
Revenue USD (% split)
Developed markets Developing markets
Data: GfK/CTA Digital World via Consumer Technology Association ‘Technology World Tour’ by Steve Koenig January 2016
The best days of smartphone growth are over
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Smartphone and tablet % growth
Smartphones Tablets
Smartphone market opportunityThe smartphone eco-system is showing declines in handset price, profit margins and hyper-competition from Chinese brands. Market pressures have already driven some component manufacturers to the wall. Looking at the PC industry as an analogue, the next stage of innovation will be around process innovation – increasing profits by making phones more cost effective to manufacture. In the case of the PC it was globalisation, moving manufacturing to the Far East. For smartphones there are three opportunities: • Automate more of the manufacturing – slim phones are hand-assembled• Cut the channel out to deliver more of the profits to the manufacturer• Change the business model to the ‘Gillette model’ – sell ancillary services for
margin to the user, or sell audiences to companies through advertising
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