Nokia’s W8 Phone Catches More Consumers’ Attention, Needs More Apps

REPORT

December 6, 2012 Companies: AAPL, GOOG, MSFT, NOK, RIMM

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Susan Jennings, sjk@blueshiftideas.com

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

Summary of Findings

Nokia Corp.‟s (NOK) Lumia 920 is the most praised

Windows phone to date, prompting some pro-Android

(Google Inc./GOOG) and iOS (Apple Inc./AAPL) customers

to switch allegiances and representing a change in

sentiment from six months ago. Microsoft Corp.‟s (MSFT)

Windows 8 OS is expected to yield long-term share gains.

The limited availability of Nokia‟s Lumia 920 on the Nov. 9

launch day created quick sellouts. Supplies since have

been more in line with demand. AT&T Inc. (T) store

sources reported initially receiving only a handful of

Nokia‟s Windows 8 devices.

An industry specialist, an AT&T store associate and a

customer said consumers are experiencing “iPhone

fatigue” because of Apple‟s recent lack of technological

improvement and a closing of the feature gap by

competitors.

App developers‟ views on Windows 8 were mixed, but four

reported increased sales of Windows 8 apps following

Lumia 920‟s release.

Microsoft is extremely supportive of and actively wooing

developers. The company is expected to catch up in

offering an app library comparable to Android‟s and

Apple‟s.

For now, Windows 8‟s lack of apps, specifically popular

ones like Pandora Media Inc. (P) and Facebook Inc.‟s (FB)

Instagram, is a negative. Lumia 920‟s weight of 185

grams also is an issue. Comparatively, the iPhone 5

weighs 112 grams.

Lumia 920’s

Popularity vs.

Previous

Windows

Phones

Current Apps

for Windows 8

Phones

App Developers

Industry Specialists

AT&T Stores

Research Question:

Will Nokia’s new Windows 8 Phones be this holiday season’s surprise winners in

smartphone sales?

Silo Summaries

1) APP DEVELOPERS Two of seven sources have seen downloads of their Windows

apps increase 30% to as much as 100% since Lumia 920‟s

launch while a third source expects the phone to gain in

popularity. Two others have experienced a slight increase in app

downloads; one of the two expects single-digit growth for the

Windows 8 platform year to year. The remaining two sources said

app developers have little interest in creating apps for Microsoft.

Still, five sources praised the company‟s support of app

developers. Lumia 920‟s hardware, particularly the PureView

camera, are positives, but the phone‟s weight is an issue.

2) INDUSTRY SPECIALISTS All five sources were more positive on the Lumia 920 than on any

other previous Windows phone. One source believes reported the

phone shortages have more to do with a lack of supply rather

than heavy demand. A second source said Nokia is the leading

Windows phone maker and believes Windows eventually will take

share from Android and iOS. Another believes the Lumia 920 will

allow Nokia to increase its share relative to Samsung and HTC.

Four sources who commented said the Windows 8 platform still

is missing a few key apps, including Instagram. Positive

comments centered on Microsoft‟s support of developers and

Lumia 920‟s attractive price point, camera and large screen size.

One source noted Android and iOS fatigue among consumers.

3) AT&T STORE VISITS Five of eight sources who commented on the Lumia 920‟s

launch-day sales reported selling through all their inventory but

added that initial stock was between only five to 15 phones.

(Three had no comment on launch-day sales.) Three sources

noted increased consumer interest compared with previous

Windows Phone launches, and one source said his store had a

line waiting outside on launch day—a first for Windows Phones.

4) VERIZON STORE VISITS Of the two sources, one reported no customer demand for

Windows phones, which may change over time as people become

aware of the devices and the OS. The second source believes

Windows phones will be as popular as Android and Apple phones

within two years.

5) CUSTOMERS Of these four sources, one was not a fan of Microsoft but now

owns and likes the Lumia 920, namely because of its gaming

capabilities. Two others are considering the Lumia 920 because

they said its features are on par with or exceed the iPhone‟s. One

of these two also said consumers are tiring of the iPhone‟s recent

lack of technological advancement. Our fourth source believes

Windows phones need to be better promoted and that the Lumia

920 is too large.

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

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Background

Blueshift Research‟s Aug. 31 report focused on long-term sales prospects for Nokia‟s Windows 8 Phones. Store sources

reported hearing no consumer buzz for the phones, but app developers were cautiously optimistic for Windows 8 and on

Nokia‟s ability to lead in offering devices for the OS.

Blueshift found strong initial sales for Nokia‟s Lumia 920 and shortages on and shortly after its November launch day, but

also lingering questions regarding Windows 8 Phones‟ holiday and long-term sales trends and the OS‟ ability to regain share

from Android and iOS.

CURRENT RESEARCH In this next study, Blueshift assessed whether Nokia‟s new Windows 8 Phones would exceed expectations following the

company‟s disappointing sales in previous Windows Phone launches. We also asked AT&T stores selling the Lumia 920 about

launch data sales and supply demand balances in the weeks following the phone‟s introduction. We employed our pattern

mining approach to establish and interview sources in six independent silos:

1) App developers (7)

2) Industry specialists (6)

3) AT&T stores (8)

4) Verizon stores (2)

5) Customers (4)

6) Secondary sources (3)

We interviewed 27 primary sources, including two repeat sources, and identified three relevant secondary sources focused on

launch-day sellout reports of the Lumia 920, the device‟s software and battery life issues, and its comparison against the

iPhone 5.

Next Steps

Blueshift will track Microsoft‟s progress in offering more high-profile apps such as Instagram. We also will question enterprise

IT department leaders on the integration of non-BlackBerry devices into the workplace and determine if Windows Phones are

gaining enterprise market share. Finally, we will follow up on sources‟ negative comments regarding RIM to determine the

company‟s future footing in the enterprise market.

Silos

1) APP DEVELOPERS Two of seven sources have seen downloads of their Windows apps increase 30% to as much as 100% since Lumia 920‟s

launch while a third source expects the phone to gain in popularity. Two others have experienced a slight increase in app

downloads; one of the two expects single-digit growth for the Windows 8 platform year to year. The remaining two sources

said app developers have little interest in creating apps for Microsoft. Still, five sources praised the company‟s support of app

developers. Lumia 920‟s hardware, particularly the PureView camera, are positives, but the phone‟s weight is an issue.

CEO for a European mobile app developer with more than 24 published Windows Phone apps

Downloads of the firm‟s Windows Phone apps have spiked 30% since the launch of the Lumia 920, prompting the source

to believe the phone will be a big success in the coming months, especially in Europe. The PureView camera and software

such as Nokia Drive will make the 920 very attractive, especially when combined with improvements in the OS. Microsoft

has done well to attract top developers to the platform, but the jury is still out on how successful the OS will be on PCs.

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

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“From my application downloads, I can see that after the Lumia 920 introduction the number of downloads grew

quickly. Downloads have increased by 30%.”

“Definitely it is possible for Windows Phone 8 to take significant market share. The Nokia phones especially will

take a huge portion of that share. Windows Phone is not a well-known brand, but Nokia‟s Lumia is getting more

and more traction. People are starting to speak on the streets about the Lumia and starting to ask about what

make my phone is (I have a Lumia 900). This phone looks astonishing.”

“The new camera [in the Lumia 920] with optical stabilization looks and works great. I think it‟s the best

available on the market. In terms of software, they are getting better and better, especially Nokia Drive, which is

a key feature. With Windows Phone 8, a lot of bug fixes were introduced, so it should be great.”

“Microsoft filled a lot of the gaps on Windows Phone 8—better music, better NFC. Nokia also filled some gaps—

the great Nokia Drive application, data transfer counters. A lot has changed since version one; now they have to

inform consumers about those changes and to train sellers.”

“[Microsoft] is doing very well [in marketing Windows 8]. Look at the

Windows 8 apps; they‟re getting all the top developers. Everyone is

interested in creating apps for Windows and Windows Phone 8.”

“Recently, I spoke with a Microsoft employee. They are planning big. A

lot of money will be invested in Windows 8‟s success. A lot of apps will

be created soon. They are working hard with companies to create new

apps and port the most successful apps from other platforms.”

“We are tweaking our best apps for Windows Phone 8. No big changes

are required to adjust apps [from Windows 7].”

“I was working for a while on Windows 8 on a PC because I had to build

some apps for Windows [Phone] 8. In my opinion, it will be great and a

big success on tablets. That is guaranteed. On PCs, we will see. It will

be much easier for young and new people to get used to the new Windows 8. For older ones and for pro users,

we have to wait for a few more apps in the Windows Marketplace. The number of apps is growing pretty fast,

and they are OK though not perfect. Developers still have some time to make them better. Windows 8 will be OK

for new PCs with touch screens and more sophisticated touchpads.”

“Most developers do games, and with Windows Phone 8 it will be possible to create native apps using

[Microsoft‟s] DirectX and [Unity Technologies‟] Unity Engine. In my opinion, a lot of developers will jump on that

opportunity. It will be easy to port apps from Xbox 360, Windows 8 and so on.”

Windows Phone 8 app developer based in Canada

This source has seen downloads of his most popular apps double since the release of the Lumia 920 and believes Nokia

will be the leading manufacturer of Windows 8 devices as long as it can keep up with demand. Nokia‟s new ad campaign

has attracted a large audience. The Lumia 920‟s built-in features, such as wireless charging, the PureView camera and

NFC, are important and differentiate it from the iPhone. Improvement to the Windows Phone 8 platform gives developers

the ability to build better game experiences in shorter periods, all within a well-supported development environment.

“I currently have 115 Windows phone apps in the marketplace; by the end of the year I hope to have 150.”

“I‟ve seen downloads for my top 10 apps double in the past week since the Nokia Lumia 920 came out. I‟m

excited. I‟m watching my revenues go up.”

“As long as Nokia can keep up with the demand, I think they will be the leading manufacturer.”

“The Windows Phone 8 platform opens up a lot of things for developers. It gives them a lot more options to build

experiences that they couldn‟t previously build on the Windows Phone 7 and 7.5 platform. Windows Phone 8

gives developers more access to the phone hardware itself to be able to make better games, to make a better

experience for games. Before, it was harder to do.”

“Nokia has more Windows 8 models out there than any of the other vendors. … They are covering a wider range

and can pick up a larger share of the buying public.”

“Nokia‟s marketing is now smart and humorous and is leading to better acceptance.”

“Nokia‟s lower price is also reaching the younger, student-type customer who doesn‟t have a lot of money now

but who will later graduate into the next phone and buy more apps.”

“Microsoft is also marketing Windows 8 properly, which I didn‟t see with Windows 7. They are getting it front of

people‟s eyes. I went to see the Twilight movie recently, and during the ads three were Windows 8-related.”

Microsoft filled a lot of the gaps

on Windows Phone 8. … A lot

has changed since version one;

now they have to inform

consumers about those

changes and to train sellers.

CEO, Mobile App Developer

European

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

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“I‟m just developing for Windows now. I‟ve dropped all the others because I haven‟t found them as profitable.

I‟ve got one project where I‟m doing both a Windows Phone 8 and an iOS version of an application. … The iOS

part of that build is taking almost three times as long, which gives you an idea of the costs involved, longer

coding time. That‟s one of the reasons I see a very heavy Windows 8 adoption coming for businesses.”

“Wireless charging is one of the cooler features of the Lumia 920 that is attracting consumers. … It‟s a positive

differentiation with the iPhone.”

“The camera on the Lumia 920 is one of the best cameras I‟ve ever

used, whether it‟s on a phone or not. Any kind of evening or night photo

is fantastic. My pictures are just stunning.”

“Another differentiation with the iPhone [is] there is access to NFC.

That‟s like being able to tap and transfer files back and forth to each

other. Have you ever seen the posters in airports or malls that say

„Touch your phone here and I‟ll give you song‟? It‟s NFC that sends the

URL to your phone and then your phone goes and gets it. Developers

are excited about NFC. They are thinking about what kind of cools app

they can build using NFC that will make them the next rich guy. It opens

up a whole new way of communicating and getting information back

and forth. It definitely creates excitement both in the development

communities and in the consumer communities as well.”

“People Hub is a new part of the Windows Phone 8 OS; you can attach

you Facebook, Twitter, LinkedIn, etc., and it will go out and find all your

contacts and bring them into one center, which they call „People.‟ You

can then put those people in different groups and instantly see what

they are doing along all the social networks. It‟s done quite

seamlessly.”

“People also want color and design. On the Windows 8 phones you can

set your screen‟s „Live Tile‟ colors to suit your mood. It‟s a fantastic

option … and is something that doesn‟t exist elsewhere.”

“Apple has been able to do something that no one else has been able

to do: They put a useful, complicated and intricate device into your

hands and within a couple of minutes you know how to work it. That‟s a

huge win. That is the model that everyone is following, and I think

Microsoft had done a great job making the Live Tiles adjustable on the

front screen, making it so that you can customize the phone the way

you want it. … Microsoft is properly integrating things into their

management system for companies that want to be able to have a

smartphone experience.”

“Microsoft is providing a unified ecosystem like Apple‟s App Store,

whereas with Android there are something like 13 different stores now. … Android‟s a problematic system that

ends up being a hard sell for the ecosystem. But the bigger problem is that it‟s a hard sell for businesses to

accept Android phones coming into their network, to have business emails going through their devices.”

“The consumers buying Windows 8 phones also tend to be buying apps. They are not just going and

downloading free apps or stolen apps. They are actually purchasing apps. It‟s generating revenue. With Android

phones, developers aren‟t making a lot of money. If you look at the Android model, you can buy Android phones

in parts of the world for $30 to $40. People who are buying cheap smartphones on last year‟s hardware are not

going to go out and spend the same amount on apps.”

“Both Nokia and Microsoft are putting a lot of effort into making sure the developer communities are properly

supported. The Windows 8 platform is the only one that does that. On the Apple platform, developers are just

about on their own. Basically, Apple is a cost center for development, whereas Microsoft makes sure the tools

are free. You can get all sorts of excellent help, videos, source code and sample code. They give you everything

they can to make sure the app developers have the most easily managed, connected and supported experience.

That really excites developers, and I‟ve seen a lot of them come from other platforms to develop for Windows

Phone 8 because of both the new hardware features, the new software features and the new access. The ability

I‟m just developing for Windows

now. I‟ve dropped all the others

because I haven‟t found them

as profitable. I‟ve got one

project where I‟m doing both a

Windows Phone 8 and an iOS

version of an application. … The

iOS part of that build is taking

almost three times as long. …

Both Nokia and Microsoft are

putting a lot of effort into

making sure the developer

communities are properly

supported. The Windows 8

platform is the only one that

does that. On the Apple

platform, developers are just

about on their own. Basically,

Apple is a cost center for

development, whereas

Microsoft makes sure the tools

are free.

Windows Phone 8 App Developer

Canada

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

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to use their existing code base from other languages, the support level, and the developer tools are the best in

the industry.”

“The development time is much quicker now with Windows Phone 8. Let me give you an example: I can write an

application on in Objective-C on Xcode for Apple in six weeks. I can write the exact same application using

Eclipse and Java and XML on Android in about two and a half weeks. I can write the same exact application for a

Windows 8 phone in two days.”

“On the Apple platform, I believe the developer program costs $99 a year. The Microsoft platform is also $99 a

year, but with Apple you have to buy the development tools. … Then you also have to buy a Mac. A Mac with

comparable hardware to a PC will be almost twice as much.”

Co-founder and user-experience designer for a Windows Phone app development team

The Lumia 920 will be extremely popular because it offers great hardware, a terrific camera, the best GPS software and a

palatable price. For developers, Windows Phone 8 is not yet a moneymaking opportunity, but the development tools are

easy to use and the platform represents a chance to get in on the ground floor.

“The 920 is the first Windows Phone device that I can genuinely recommend over Android and iOS phones. I just

ordered 920s for my parents, siblings and close friends.”

“The display is very clear, produces rich colors and outperforms all other displays in direct sunlight. The camera

takes great shots with a novelty factor of being able to take photos in the dark. It has the best GPS software on

the market. It‟s the most durable phone on the market; it‟s a tank and most definitely feels that way. It can be

used as a portable hard drive. You can drag and drop music and video files—no need for software like iTunes.”

“It has many attractive color options, very reasonable prices and is an intuitive and easy-to-use OS. I think the

920 has a good chance of being widely adopted.”

“Nokia handsets have exceptional build quality. … The latest Lumia

phones also have fantastic hardware—screen, camera, internals—and

come bundled with really useful exclusive apps such as Nokia Drive.”

“When it comes to shop windows and display stands, I think the Nokia

devices have a really good chance of standing out this year.

Consumers are going to be pleasantly surprised with what Nokia and

Windows Phone 8 have to offer.”

“There is no doubt in my mind that Nokia will lead [the Windows Phone

makers]. I don‟t see Samsung [Electronics Co. Ltd./KRX:005930]

competing with them at all on this front. If anything, HTC

[Corp./TPE:2498] is the one that could potentially take the top spot as

they‟ve come up with some great handsets, but I really don‟t see it

happening.”

“Many people still hold Nokia in high regard. Who doesn‟t have fond

memories of their products? I think people will be more than happy to

give them a second chance if they‟re presented with a device that is on par with or better than iOS and Android.”

“The only real way to make money [as a developer] on Windows Phone 8 right now is via contracting. I don‟t

believe the ecosystem is big enough to support successful consumer-based apps. The only reason we are

building consumer-based apps is to gain exposure for ourselves in preparation for the potential success of the

platform. If we had a killer app idea that hadn‟t been done before, the first OS we‟d support definitely wouldn‟t

be Windows Phone. The numbers just aren‟t there yet.”

“We [started developing for Windows Phone because we] were very impressed by the Metro Design Language.

We believed that its unique and refreshing take on the smartphone OS would really help Windows Phones stand

out from the crowd and provide a genuine alternative to iOS and Android.”

“iOS and Android are saturated markets. It‟s much easier to stand out and be noticed on a completely new

platform such as Windows Phone.”

“I have never developed for iOS or Android. However … Microsoft‟s development tools are second to none.

Microsoft makes it extremely easy for developers with a fantastic tool set, a wealth of learning resources and

plenty of development and design templates that make it very simple to get started. The developer community is

also huge, and because the technologies used to build apps on Windows Phone 8 have been around for a long

time, it‟s also very easy to get help or find issues that have been experienced by others online.”

Microsoft still has more work to

do when it comes to marketing

the phone to consumers. I

don‟t believe it‟s common

knowledge that Microsoft has a

smartphone OS on the market

that is just as good as Android

or iOS.

Co-founder & Designer

Windows Phone App Developer

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

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“Microsoft still has more work to do when it comes to marketing the phone to consumers. I don‟t believe it‟s

common knowledge that Microsoft has a smartphone OS on the market that is just as good as Android or iOS.”

“I think they are on the right track. We attended the Microsoft Build 2012 conference. … They were able to

generate a real buzz around the new platform and showcase the potential for why people need to start building

apps for it.”

“I don‟t see any major issues with the Windows Phone Marketplace. From a developer‟s point of view, it would

be nice to have clarity on how they rank apps and have access to better, more real-time analytics, but I don‟t

think there are any problems here from a consumer‟s point of view.”

Windows programmer with two apps in the Windows Phone store

Nokia‟s Lumia phones running Windows 8 are unlikely to greatly affect the smartphone market this holiday season; the

Windows platform remains a distant third in consumers‟ minds. Some phone buyers will be attracted to the Lumia 920‟s

great camera, but others are likely to be turned off by its size and weight. The winner among Windows 8 phone makers

will come down to marketing rather than technical specs. Microsoft is effectively marketing the Windows Phone platform

to developers.

“Unfortunately, Windows Phone is a niche operating system. Until

Windows Phone is widespread and plays an equal role to the other

mobile operating systems, Windows Phone devices will remain niche

phones.”

“I hope [Windows Phones will gain significant popularity], though I don‟t

see it happening in the next one to two years. Windows Phones … are

trying to play catch-up, but some consumers are going to want to stay

with their current platform for quite a while, just because it works for

them. I think Windows Phone has the full potential to become the No. 2

operating system, but it will not happen immediately and thus is not

relevant for the current wave of devices.”

“The Nokia Windows 8 phones are bigger than some of the alternatives and in some cases don‟t provide any

real benefit in terms of features. With that said, the Lumia 920‟s camera is really different, so some customers

could be attracted to the device by that feature.”

“One thing that will be taken into consideration by all customers is the size of the device in comparison to

alternatives. My wife tried my Lumia 920 and the HTC 8X in the store and decided that she much preferred the

[8X‟s] lighter/slimmer device over the camera feature.”

“[Nokia‟s] Lumia and [Samsung‟s] Ativ will compete. I‟m not sure who will win. I guess it depends more on the

marketing than on the technical side. It‟s hard to say who the leading Windows 8 phone manufacturer will be. It

might be Nokia, but it also very well might be HTC or Samsung.”

“Among the Windows Phone 8 devices, Lumia will be widespread. It will be one of the top three, not a true niche

device like the Lumia 610. With that said, I think that each company [Nokia, Samsung and HTC] will have

roughly the same market share.”

“I‟ve seen the TV ads for Windows Phone 8—very nice and appealing. But Microsoft is doing a much better job

promoting the platform to developers [than to consumers], with free tools, educational content and training for

Android and iOS developers.”

“I have been a professional developer with Microsoft technologies for more than 10 years, so Windows Phone

was low-hanging fruit when I evaluated the mobile platforms. I have apps published on all three platforms [and]

the Microsoft platform is by far the easiest to learn and develop with. In terms of profitability … the answer

clearly depends on how widespread Windows Phone becomes as a platform.”

“From the consumer‟s point of view, the [Windows Phone app store] is good. From a developer and publisher‟s

point of view, it could be better. Nothing too serious to be concerned about—just issues with a long certification

process and some reports, which could be changed.”

Executive for a multiplatform app development company in the United States

Windows 8 phones will see single-digit growth during the next 12 months, and the Lumia 920 will fare better in Europe

than in the United States. The source‟s company has developed apps for Windows 6 and 7 products but has had zero

demand from developers pursuing Windows 8 apps. The Lumia 920 has impressive features and functionality, but its

I have apps published on all

three platforms [and] the

Microsoft platform is by far the

easiest to learn and develop

with.

Windows Programmer

Windows Phone Apps

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

7

weight and the feel may discourage buyers. Among the Windows 8 offerings, the HTC 8X will outsell the Lumia 920

because it weighs less (130 grams vs. the Lumia‟s 185 grams).

“Nokia is in a very tough spot in the U.S. and having a hard time getting into North America. As consumer sales

and interest pick up in places like Africa and India, it may help. In the United States, the Nokia Lumia 920 is

being pushed by AT&T, and that‟s a positive. Android ultimately got accepted because Verizon [Communications

Inc./VZ] pushed it.”

“They will probably sell a lot of Lumia 920s this season but not as much as the Windows 8 competitors.

Windows Phone will do OK overall, but … the HTC 8X is already having a hard time even though it‟s lighter and

streams faster than the Lumia. [Microsoft] may be off to a good start, but adoption will be slow.”

“We develop apps for smartphones and the Web, across all platforms. … We worked on apps for Windows 6 and

6.5, which was an absolute nightmare. We partner with firms and individuals for app development, and we have

not seen one opportunity for Windows 8 app development. People are still leading with iPhone apps. The

proliferation of Android apps has gotten absolutely crazy.”

“The market for Windows 8 smartphones in general seems positive,

and they have a good operating system. But they are not suddenly

going to overtake the market. … The Windows 8 smartphone will

probably be in the single digits [of market share] by next year. The

phones might carve out a niche over the long haul, say the next five to

10 years, but they will have to keep at it.”

“The [Lumia 920] camera is killer [and] is excellent in both bright light

and dark settings. The picture is crisp and clean. It‟s probably the best

camera I‟ve seen on a smartphone. It‟s probably got higher quality than

the iPhone. The quality of the camera does not surprise me because in

2007 Nokia was a leader in smartphone cameras.”

“The Lumia 920 also has wireless charging. You just drop it into an

induction charger.”

“As for Windows Phone 8, I like the design. It‟s definitely a different

navigation system than Android or iOS. It uses tiles instead of icons. It‟s

a different paradigm, and consumers will either like it or not. … Nokia is

nowhere in North America, and it‟s been that way for them for about 10 to 12 years. They are trying to crawl

their way back in the U.S.”

“Samsung isn‟t out yet, but if the Samsung [Windows 8 phone] is thinner, lighter and is closer to the HTC,

Samsung will do better than the Lumia. The Lumia has distinct qualities, but as soon as you put it in your hand,

it loses some appeal. Based on what we‟ve seen in the Galaxy family of Samsungs, they will probably go for a

large screen but a device that is „softer‟ in the hand. The hardware will feel better. [Samsung] uses plastic

hardware whereas the Lumia series relies on metal. The Galaxy S III has a 4.[8]-inch screen and weighs 4.[7]

ounces. The Lumia screen is the same size, but it weighs 6.5 ounces.”

“The Lumia 920 has more competitive features than the HTC [8X], but as soon as you pick it up, it‟s too heavy.

The colors and designs are appealing, but the sound qualities for the HTCs are pretty good. [HTC] does lose out

with the induction charging and the camera.”

“Samsung sold 66 million phones last year, and I would bet Windows will have a hard time doing a million. …

The iPhone sold 25 to 30 million last year. After that, there is not a lot left.”

App developer based in Silicon Valley

This app developer has worked for nearly 10 years on building mobile apps for Nokia‟s Symbian and Microsoft Windows

systems and currently is employed by a company developing apps for iOS. He has not seen any voluntary move by the

community‟s developers to build apps for Windows 8, and believes any development for the OS will be business-driven by

those in upper management. After testing the Nokia Lumia 920 specifically for this interview, he said he immediately was

struck by the phone‟s excessive weight and was disappointed with certain aspects of the phone‟s user flow (UX). Also, he

noted the lack of some major apps. Only the Twitter app was built by Twitter; the Facebook and YouTube apps both were

built by Microsoft, which he said signals the lack of interest in developing in the Windows Phone 8 space.

“It‟s too early to talk about building our company‟s application for Windows 8 yet.”

“Voluntarily, I‟m not seeing the mobile development community moving into Windows 8.”

We partner with firms and

individuals for app

development, and we have not

seen one opportunity for

Windows 8 app development.

People are still leading with

iPhone apps. The proliferation

of Android apps has gotten

absolutely crazy.

Executive, Multiplatform App Developer

United States

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

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“Development for Windows 8 could be somewhat business-driven. I‟ve

heard some OEMs ask management at our company if we are planning

to build our mobile product for Windows 8, but currently we are not.”

“One of the first observations I have of Lumia is that it seems four times

heavier than the latest Android or iPhone.”

“I am a bit disappointed with some of the basic UX aspects of the

phone. For example, configuring or prompting for Wi-Fi is a core part of

a mobile phone, but when I returned home from the office, I had to

search in the settings and then go change the Wi-Fi access point.”

“There are some continuing UX engineering issues that I associate with

the old Nokia Symbian and Windows operating systems. It‟s just a gut

feeling that I have.”

“I didn‟t see any major apps in the Windows app store. Only Twitter is

developed by Twitter. All the latest social apps like Pinterest and

Instagram are not yet available directly from those companies. The

Facebook app is not by Facebook; it‟s developed by Microsoft. The

YouTube app is also developed by Microsoft. This shows there‟s not

much interest yet from the major companies to develop apps in this

space.”

“I‟m not surprised that the Lumia is selling well in Europe; there is some loyalty to the brand there.”

“With Nokia, I expect the camera and music to be great.”

“The phone is good. I like the UX more on the Windows 8 desktop than on the mobile Windows 8. I felt

connected on the desktop but not very excited on the mobile. This is all feedback as a user.”

India-based mobile developer with six apps in the Windows Phone store

The Lumia 920 might just be the best smartphone on the market and should excel in India if priced right. Microsoft has

not done much consumer marketing of Windows Phones in India but has been reaching out to developers, which is

important given the holes in its app store.

“I find the Lumia 920 much better than any Android phone or iPhone 4S/5. The only drawback I see is the

weight. However, I believe that given the right pricing strategy, it could sweep the market.”

“[Nokia‟s Windows 8 phones] are top-notch handsets in terms of quality and beauty. I don‟t see a reason they

will fail.”

“The Lumia line of phones is very rich at the moment compared to Samsung‟s Windows Phone 8 lineup, so I

believe Nokia will fare really well. Nokia is also addressing all price points with different handsets, so my take is

that Nokia will win this battle [among Windows Phone 8 manufacturers].”

“I haven‟t see much [marketing of Windows Phones] in India in the consumer space. Developers are a different

story. I see a lot of events happening for them, but device unavailability is a big factor. I am waiting for Lumia

Windows 8 phones to launch in India to really get started with development.”

“The Windows Phone store still doesn‟t have the app parity to iPhone or Android at the moment. I think there is a

big opportunity there to bring top app and game developers to the Windows Phone ecosystem. I think some sort

of direct engagement with them would help in a great way.”

“I became fascinated by Windows Phone when it launched in 2010. I just loved the platform and the idea that

every .Net developer was now a Windows Phone developer as well. With Windows Phone 8, I just feel that native

code support just exponentially expands the potential of the platform and opportunities.”

2) INDUSTRY SPECIALISTS All five sources were more positive on the Lumia 920 than on any other previous Windows phone. One source believes

reported the phone shortages have more to do with a lack of supply rather than heavy demand. A second source said Nokia is

the leading Windows phone maker and believes Windows eventually will take share from Android and iOS. Another believes

the Lumia 920 will allow Nokia to increase its share relative to Samsung and HTC. Four sources who commented said the

Windows 8 platform still is missing a few key apps, including Instagram. Positive comments centered on Microsoft‟s support

All the latest social apps like

Pinterest and Instagram are not

yet available directly from those

companies. The Facebook app

is not by Facebook; it‟s

developed by Microsoft. The

YouTube app is also developed

by Microsoft. This shows

there‟s not much interest yet

from the major companies to

develop apps in this space.

App Developer, Silicon Valley

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

9

of developers and Lumia 920‟s attractive price point, camera and large screen size. One source noted Android and iOS

fatigue among consumers.

Trade journalist covering mobile devices for a popular online publication; repeat source

The Lumia 920 smartphone is a far improvement over the Lumia 900 and appears to be selling well in international

markets. However, its popularity is muted in the United States because of its weight, its control by a single carrier (AT&T)

and its lack of popular apps. Reported shortages of the Lumia 920 may have more to do with marketing or supply

shortages than demand.

“The Lumia 920 is a good improvement over the Lumia 900. I‟ve heard the new Nokia/Win8 model is doing well

overseas. Here in the U.S. it‟s not as popular. Some people think it‟s a little bulky.”

“Any news of improved sales is good news for Nokia and any improvement over the previous Lumia model will

be a bonus. But I do not see it becoming the next iPhone.”

“I‟ve heard they have sold out at various AT&T stores, but I don‟t know what that means. It could be lack of

inventory, which could be more about a production problem than demand. A lot of companies play with the

[supply] numbers and a new product‟s market progress to create a

buzz.”

“It‟s a tough market here, and [Nokia is] trying to build a reputation

from scratch. Plus, there is a huge number of devices out this season,

with half a dozen top-level flagship phones competing. Samsung is a

huge competitor with the Galaxy S III. There‟s the iPhone 5; despite its

recent problems, it is popular because it has so many apps. We are not

wanting for good phones this year. The Lumia 920 has an advantage

on price, but you can only get it on one carrier [AT&T]. Nokia can have a

good holiday season and still not make a dent in the market.”

“If [Nokia] becomes the dominant Windows phone here, it will help, but

I don‟t think [Windows 8] will be as competitive as other platforms. I

don‟t see [Nokia] becoming the No. 1 smartphone maker, but I do think

if they keep at it, they will see growth and become a more significant

player.”

“Windows 8 itself has not done as well as Microsoft had hoped. But it

would be difficult to fail completely because every improvement for Windows is an advance. I don‟t think they

are making huge headway. I still think it‟s going to be a single-digit growth for market share.”

“Windows Phone 8 is doing better than the Windows 7, up to four times better, but part of it may be that

Microsoft has spent about a billion dollars to advertise Windows 8.”

“Windows is still lagging behind in apps although the quality is improving. Most of the app developers are on

Android and iOS, and Windows is still in third. I don‟t think app developers will give up other platforms. Even if

Windows takes off, I don‟t see developers committing to Microsoft exclusively. Most want to develop for the

whole spectrum of platforms. … iOS is still the No. 1 choice for app developers, even though the iPhone has only

20% to 25% of the market. Android is only now beginning to get interest from app developers.”

“Samsung keeps delaying its release first it was going to be November, then December. Now they are looking at

next year. As far as I know, Verizon is the only carrier, and I‟ve not heard anything mind-blowing. I don‟t know

why there‟s a delay but my guess is that it‟s an issue related to Verizon.”

Senior tech analyst/writer for an online technology site

This source was surprised by his readers‟ excitement around a Windows phone after he posted a 10-day video series on

the Lumia 920. Even his peers, who are iOS and Android users, are showing more interest. He attributes interest to user

fatigue with iOS and Android, but he is not sure if consumers will make the switch because of Windows 8‟s lack of apps.

Microsoft and Nokia are courting developers, and Microsoft provides the best development support; in time, the app

situation should improve. It is easier now for developers to build mobile game versions on Windows Phone 8.

“I cast the idea out on Twitter to ask what people would think about watching a video series about me trying out

the Lumia 920 phone, as someone who is very ingrained in the iPhone, for 10 days and giving my opinion about

the experience. The response, especially from Apple users, shocked me. People were really interested in seeing

what it was like.”

We are not wanting for good

phones this year. The Lumia

920 has an advantage on

price, but you can only get it on

one carrier [AT&T]. Nokia can

have a good holiday season

and still not make a dent in the

market.

Trade Journalist

Covering Mobile Devices

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

10

“I‟ve had a couple of coworkers say, „I could really see myself using

this,‟ or „I really want this,‟ which I didn‟t hear a year or six months ago.”

“I haven‟t seen this sort of excitement around any Windows phone,

period, in the last few years. There‟s definitely now an interest in giving

the Nokia Lumia 920 a look, which we didn‟t have a year ago or even

nine months ago when they released the Lumia 900.”

“There‟s built-up smartphone user fatigue. People are feeling bored

with what they have on iOS and feel that Android might be a little bit too

fragmented and complicated. They are willing to look at an alternative.”

“Whether or not consumers are going to shift to the Lumia 920, I don‟t

know, but there is definitely an interest level there. I think people are

actually going to visit the stores and give it a closer look and play with

it.”

“I‟m the only one in the office who has a Lumia 920; it‟s mostly a mix of

iPhone and Android.”

“The phone itself is big, but it takes really great pictures, even in low

light.”

“I like the People Hub; I love the way they have put the contact ecosystem together in a seamless way.”

“There‟s still an issue of apps not being there in the same way that they are with iOS and Android, but it‟s gotten

a lot better.”

“Something like 96 out of the top 100 most popular apps are there and represented on the Windows platform.

That‟s getting closer, but more important is that consumers are now interested in looking at it.”

“Finally, Microsoft has checked some of the required boxes. They‟ve got support for multitasking, and certain

apps are supported.”

“Not having Instagram really hurts the platform.”

“We haven‟t seen the developer adoption with the Windows that we‟ve seen with iOS and Android—not just in

terms of number of apps but also in quality.”

“There are some really good apps, but there are apps that just feel less mature and less realized than you see

on iOS and Android.”

“Windows 8 makes it easier for game developers and application developers to build mobile versions of their

apps or games.”

“Microsoft has the best developer relations on the planet. They go out and give their developers more support,

more information and more resources than any other company.”

“I also think the branding that‟s been going around Xbox has finally

started to work and that people who are invested in that system, or

those looking at the Surface tablets, are getting excited about Windows

8.”

“It‟s harder now for developers, especially for independent developers,

as well as some of the more name-brand developers, to adopt another

platform unless they know the payoff is going to be there with users.”

“Microsoft is going to have to focus on not just getting developers to

bring apps in but to make sure they are quality apps.”

“Apple is not going to pay anyone to make an app for their platform;

that‟s just not how they work. Microsoft is actively courting developers

and corporations to get them to make things. … Nokia has some

exclusive apps that you can you can only get for a period of time. They

are actively trying to get that stuff there.”

“Apple was very fortunate that they had a strong Mac software community, so with the iPhone they were able to

launch some very cool apps at the starting gate.”

“The other thing with iPhone is that early on, the best apps were from independent developers and they helped

define the ecosystem going forward. But those independent developers were really talented, and I have to say

that I haven‟t seen that kind of talent on a Windows phone.”

I haven‟t seen this sort of

excitement around any

Windows phone, period, in the

last few years. There‟s

definitely now an interest in

giving the Nokia Lumia 920 a

look, which we didn‟t have a

year ago or even nine months

ago when they released the

Lumia 900.

Senior Tech Analyst/Writer

Online Technology Site

There‟s built-up smartphone

user fatigue. People are feeling

bored with what they have on

iOS and feel that Android might

be a little bit too fragmented

and complicated. They are

willing to look at an alternative.

Senior Tech Analyst/Writer

Online Technology Site

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

11

Owner and editor-in-chief of an independent Nokia blog; repeat source

The Lumia 920 will be the breadwinner among Windows smartphones this year, surpassing HTC and Samsung in sales

thanks to features like PureView, the high-end screen and the navigation system. Nokia already is a leading manufacturer

in Europe, and the Lumia 920 should advance Nokia‟s position in North America. The Lumia 920 and Windows Phone 8

likely will not surpass Android, iOS and the leading device brands, but persistent marketing and a stronger stable of app

developers could narrow the lead.

“My view of the Nokia Windows device is more positive than it was three months ago. … They … listened to

consumer concerns. Are they there yet? No. They are still the third choice behind Android and Apple. … It‟s more

a matter of marketing and helping the consumer get out of their skin to make them more comfortable with the

Windows platform.”

“The Lumia 920 has gotten the attention of consumers. Now it‟s up to the marketing teams to carry it.”

“Windows 8 adoption seems to be going well. Anecdotally, I‟ve noticed more people outside of my normal peer

group [of Nokia users] with the Lumia 920. Outside of my circle, I can count four people that suddenly have

purchased the Lumia 920 or 820. Part of the interest is driven by price, and part is driven by advertising and TV

commercials. The commercials are attracting attention.”

“The Nokia Windows phone will stand apart from competitors because

Nokia owns so many patents and they‟ve been around a long time. I

think Nokia will destroy the [Windows Phone] competition in sales. HTC

is missing some important apps, and Samsung hasn‟t even been

released yet.”

“The cost is a no-brainer. If you are with AT&T and want a new phone,

do you go with the 32-GB Lumia 920 for $99 or the new iPhone for

$299? It‟s true there are some people who just go in to a store and ask

for the iPhone by name outright.”

“I have heard about shortages and backorders. I‟m not sure Nokia

realized how well it would sell. … There‟s a two-week backlog on

Amazon[.com Inc./AMZN], and in some AT&T stores I‟ve heard about

shortages of certain colors and white.”

“It‟s hard to decipher shortages. Apple regularly reports shortages, and

iPhones sell out after a new release. … I don‟t know if it‟s an industry

market scheme … or it‟s out of stock and on backorder. … I have not

heard of any production or manufacturing problems. There are no

major bugs affecting the supply chain.”

“I‟m using the Lumia 920 as we speak, and I absolutely love it. It offers so many new and improved features.

The thing that is huge for me is the extra-sensitive screen. … It is a decent size and has some heft, which I like.

It‟s not flimsy. The view is excellent in sunlight. … It also takes low-light photos.”

“The Lumia 920 has good handling and good integration. Windows 8 has enhanced … storage. … The new tile

screen is improved with three different sizes. … The Lumia 920 is the only Windows phone with PureView and

special technology for the camera. It has optical image stabilization for video.”

“Integration is coming along, given the amount of time Windows has been out. If you look at the early releases of

Android, during the same initial time period they have more apps onboard than Android did and they are on par

with the number of apps Apple offered during the early phases and during the same time period.”

“Windows 8 is doing pretty well with apps, but it‟s hard to compare it with Apple or Android. They are well behind

them although they have many of the mainstream apps. People do want some of the big apps like Instagram.”

“They have done a fine job with exclusivity. There are a lot of exclusive apps for the Lumia 920, including Nokia

partnerships with ESPN and Zynga.”

“Windows is a decent platform to work on. There not much coding, and it doesn‟t take very long to do. The more

people who use the Windows Phone, the more the app developers will build. If Windows 8 really takes off this

season, they will jump onboard. And Microsoft‟s status is huge because of its integration with the Xbox.”

“I can‟t see why any app developer would give up developing for iOS or Android and work exclusively with

Windows platform. App developers want to build for as many platforms as possible and profitable.”

The Nokia Windows phone will

stand apart from competitors

because Nokia owns so many

patents and they‟ve been

around a long time. I think

Nokia will destroy the [Windows

Phone] competition in sales.

HTC is missing some important

apps, and Samsung hasn‟t

even been released yet.

Owner & Editor-in-chief

Independent Nokia Blog

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

12

Owner of an online rental company for new electronic devices and gadgets

The Lumia 920 currently is the source‟s second most popular handset after the iPhone 5. He believes the 920 will

become the leading Windows 8 phone, primarily because of pricing. Customers have given positive feedback on the

Lumia‟s PureView camera, colorful look and large screen size. Negative feedback has centered on the lack of apps, which

the source said has pushed some customers to seek out the iPhone instead.

“Our No. 1 phone rental has been the iPhone 5, No. 2 has been specifically for the Lumia 920, and then the

Androids, which have all been less popular than the Lumia.”

“The problem with Androids is that there are just so many.”

“In terms of platforms, I think Lumia has become synonymous with the

whole Windows situation.”

“We do have HTC 8X and the Lumia 920, and we‟ve had much more

interest with the Lumia than the HTC.”

“The Lumia 920 will do very well because they are priced well. From a

pricing standpoint, if you are going to buy a Windows 8 Phone, you

have a $200 HTC 8X or a $100 Lumia 920.”

“Unless the other Windows 8 Phone manufacturers jump in with much

more marketing effort and muscle, I think Nokia will remain ahead of

the line.”

“Nokia has done a very good job with their camera technology. The PureView technology is very revolutionary.

It‟s something that no one else has. This differentiation will make a difference down the road because the

hardware is very important. The night photography on the Lumia 920 is unbeatable. The downside of that is that

the 920 is thicker than most phones on the market today. … The field has gone toward thinner and thinner.”

“There‟s been very positive feedback from the Lumias in general. … The app base is limited. I think that‟s the

reason why people use the Apples, but people do like the larger screen real estate.”

“The lack of applications is a setback for the Lumia, no doubt about it. … It‟s just the sense we‟ve gotten from

customers when we ask them for feedback.”

“Really, it‟s all about marketing, price and apps. Nokia finally has a device that is competitive on all subjects but

the apps. I don‟t care about the apps because I‟ve never found them particularly useful, but a lot of people

apparently care about them.”

“There are shortages [of the Lumia 920], and that has led to a number of customers on our side because we

provide the device right away.”

Device reviewer for a website dedicated to Windows Phones

The Lumia 920 will be the best Windows 8 device on the market this holiday season, and will help Nokia to increase its

share of the Windows Phone market over HTC and Samsung. How the Lumia 920 and Windows 8 will fare against

Android and iOS is too early to guess. That battle will take several years to play out and will be closely tied to Microsoft‟s

success in getting Windows 8 accepted by home PC and enterprise users.

“For the short term, I would not be surprised if the 920 sold really well. I think the $100 price range … will get

people interested. It‟s not going to do iPhone numbers. … But … it will sell well.”

“I don‟t think the Windows Phone market share will go up much [this holiday season], but the Nokia share within

the Windows 8 market will increase.”

“I was actually surprised at the $100 price. … The 920 has more in terms of hardware [than HTC‟s Windows 8

phones].”

“HTC has an interesting relationship with Microsoft right now because the 8X has been branded „the Windows 8

phone,‟ but people still think of Nokia, because of their partnership with Microsoft, as having the flagship

Windows phone. That will help Nokia, as well as the fact they were first on the market with the Lumia 920.”

“They do a really good job with the camera, and there‟s a large subset of people who don‟t want to have another

camera. They just use their phone.”

“If you look at it from a technical spec level, I think the 920 matches up with the iPhone 5 in many respects.

Where iPhone has an advantage is in the apps and the ecosystem. … People just get used to the look and feel of

it, and moving to something unfamiliar will hold them back.”

“The Windows phones, specifically the 920, matches most of [the Android phones]. The biggest thing will be

people getting used to the ecosystem. That‟s the biggest hurdle. Windows Phone came out late, very late. People

get used to what they have.”

Really, it‟s all about marketing,

price and apps. Nokia finally

has a device that is competitive

on all subjects but the apps.

Owner, Online Rental Company

Electronic Devices & Gadgets

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

13

“It comes down to getting people ingrained in an ecosystem. … It may take five to 10 years, but it‟ll eventually

happen. Consumers will get used to the product. It‟s possible they could cut that down to three to five years if

they marketed it properly and taught the public well, and I don‟t think they‟ve done that.”

“You can‟t discount Samsung‟s reach. … While Nokia may sell a good number of Windows 8 phones in the U.S.

comparatively, Samsung is going to be hard to match globally.”

“I really like my HTC Titan II, but I‟m thinking of switching to a 920 just because of everything it offers.”

“Nokia‟s biggest strength will be the support of their in-phone apps. Nokia offers applications that are only

available on the Nokia phone. … The 900 and 920 have in-phone apps that are really well done and the

interface works really well. I think that‟s going to be a selling point.”

“The issue I see [with the Windows Phone app store] is not as much quality control. Android is too open and iOS

may be too closed, but at least the Apple store has a lockdown on the quality. While Microsoft is trying to get the

numbers up, they may be letting too many low-quality apps in, and that may tarnish the marketplace.”

Founder and host of a popular website featuring mobile phone news and weekly podcasts

Despite the strong design and features of the Nokia Lumia 920, Windows 8 will be a niche player in the North American

smartphone market. The source predicts slow adoption and limited market share. The biggest opportunity for Nokia and

Microsoft may reside in the enterprise sector given the demise of the BlackBerry, the trend toward corporate support for

employee-owned devices and the ubiquity of Windows in the workplace. However, Apple‟s iPhones, iPads and the iOS

platform appear to be filling the immediate gap.

“Windows smartphones are unimpressive. I‟m not a fan. I don‟t believe Windows 8 will find much more success

this year than Windows 7 did last year. At best, I think it can secure no more than 10% of the U.S. market.”

“In the near term Windows Phone 8 is a niche product. They will need more going for them than just Nokia and

HTC in a couple of models to make the platform take off. I know Microsoft put a billion into marketing. But even

with the marketing push they will be lucky to see their market share hit 10% in the United states by this time

next year.”

“All of the initial reports and reviews state Windows 8 is an improvement over earlier releases, but I‟m still not

super interested in it. Nothing about the Windows platform grabs my attention.”

“I have no numbers on [Windows 8] adoption. But I work in the corporate setting and have not seen one person

with a Windows phone of any brand. Occasionally when I go out … I see a person with an older model but very

rarely if ever have I seen a new model.”

“There is a big opportunity on the enterprise side with the move to „bring your own device‟ [BYOD] to work as

RIM [Research In Motion Ltd./RIMM] falls out of favor and even out of functionality. My company now provides

some very slick tools for iOS to support the personal devices. RIM is done, and iPhone about two to three years

ago was not being brought into the office. Now iPhones and iPads are the favored BYOD. But Microsoft is

embedded everywhere in the enterprise setting. They do have active sync exchange in the network, but that will

not be enough to incorporate the Windows 8 phone. It‟s hard to see the corporate community suddenly

embracing a Windows phone over an iPhone, which already has one foot in, until they bring in more tools for

enterprise. And until that‟s a reality it‟s hard to see app developers rushing in.”

“The Lumia 800 and 900 series and the Lumia 920 specifically are nice pieces of hardware. The 920 has some

unique features, and it looks nice.”

“If I were going to buy a Windows phone—and I would never buy one—I would buy the Lumia 920 over the HTC

8X.”

“App development seems to be going well, and they are doing a good job of getting development people

onboard. It seems as if everything you really would need is already on the Windows phone. All of the big name

apps are there. That said, I hope the app developers stick with the platform for their sake. Right now Windows is

way behind iOS and Android. The quality right now is better than the quantity.”

“[Microsoft has] to seed the developers to get them onboard for the new platform. Meanwhile, they are sending

out the Windows 8 devices for review, and I still don‟t see that translating into widespread adoption or

excitement yet.”

“If Windows phones was a more lucrative platform it would possibly draw some developer loyalty. Developers are

frustrated with the existing platforms on many levels: iOS is too closed and Android is like working in the Wild

West.”

“The development of the apps need to have widespread or important utility. … I am someone who does not buy

a lot of apps, but when I do buy an app, I use the heck out of it. It‟s been close to a year since I‟ve bought an

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

14

app, but I made the switch to iOS because it is easier. I don‟t like using the iPad and the iPhone exclusively but

when it comes to integration, nothing else is there yet.”

3) AT&T STORES Five of eight sources who commented on the Lumia 920‟s launch-day sales reported selling through all their inventory but

added that initial stock was between only five to 15 phones. (Three had no comment on launch-day sales.) Three sources

noted increased consumer interest compared with previous Windows Phone launches, and one source said his store had a

line waiting outside on launch day—a first for Windows Phones. However, demand has waned since the launch, and two

sources said even launch-day sales failed to meet expectations. Three stores are awaiting further shipments while five

sources said current inventory is adequate to meet demand. Positive comments for the Lumia 920 included its price point,

video game capabilities, rich features and ease of use. Negative comments focused on the lack of apps. One source said

customers are beginning to tire of iPhones.

AT&T sales associate, Chicago

Although the store was prepared for the Nokia 920 to outshine the 900 in sales, staff was surprised by the phone‟s sales

strength. The store often sells out of the 920 and currently has only a few phones. Customers like the ease of use and

features; the only downside is the number of apps.

“We knew the Nokia 920 would be more popular than the Lumia 900,

but we did not anticipate how popular it is.”

“The Windows 8 phones are extremely popular. We can hardly keep

them in stock.”

“We are stocking more of the Lumia 920s, so that is what they are

usually getting.”

“We only have a few Lumia 920s in stock now—all white. We are sold

out of the red and black.”

“We should get more Lumias in today. We really don‟t know for sure,

but we get in a shipment every day.”

“The Nokia Lumia 920 is selling better than the HTC Windows phone.

Nokia is more of a well-known brand.”

“The only downside to the Windows phones is they don‟t have all the apps that iPhones and Androids have. But

they have the most popular apps ready to go, and more are being developed all the time.”

“We only got in a few of the HTC Windows phones. We only have a few now too.”

“iPhone is the top selling phone in the store, but it is limiting. You cannot download anything with Adobe Flash,

and that is not going to ever change.”

Reporter Observations: On a Monday morning the store was somewhat busy and had two checkout lines. Only two staff

members were working, and Blueshift waited 20 minutes to speak to someone. The iPhone was the first phone

displayed, followed by the Windows phones. Tablets were on the opposite wall. The AT&T Holiday Gift Guide had a picture

of the Lumia 920 on the front cover, and the first page was devoted entirely to Windows 8 phones. We did not see any

customers look at the Windows phones.

AT&T store manager, California

The store sold all five Nokia Lumia 920s received before Black Friday to former Android and iPhones users. The store did

not get a second shipment of four Lumia 920s until a week later. The phone is priced right, easy to use, feature-rich, and

versatile—perfect for business users needing Microsoft products, gamers using their Xbox, and people who have never

owned a cell phone. The negative is the lack of apps. Microsoft is excelling at marketing right now and can begin to

regain share as long as it overcomes the app hurdle.

“We were initially sent five phones, and they sold out the same day. Three were iPhone users and two were

Android. We just got another shipment of four today.”

“Our shipments usually come on a weekly basis. If I sell five Nokias, I can‟t snap my fingers and get more. We

can only carry so much stock in-store, so we can‟t sell as many as we possibly could right now.”

“The Nokia Lumia 920 is a great phone. Very simple.”

We knew the Nokia 920 would

be more popular than the

Lumia 900, but we did not

anticipate how popular it is. …

We get in a shipment every day.

Sales Associate, AT&T

Chicago

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

15

“It‟s a 32-GB, which is very good, especially at the $99 price point.”

“Showing the phone is also important. The tiles are easy.”

“Nokia should send demo devices.”

“We set up people‟s tiles when they buy a Window phone. Otherwise, they‟ll walk out confused.”

“This is a great phone for business users—those who already know and use Microsoft products. You don‟t have

to mess with third-party apps.”

“The phone is very nice to connect with computers and tablets, and the

charger is a wireless pad. You don‟t have to plug it in.”

“The maps are good and improving. The talking [Nokia Drive, the

equivalent to iPhone‟s Siri] is on point.”

“I haven‟t even mentioned how great the Xbox part of this is. It‟s so

fast.”

“There are no viruses like you get with the Android.”

“You can‟t scratch the Nokia. … I show customers that I can‟t scratch it

with a key.”

“The negatives are the apps. Instagram is huge, and that‟s what people

want. That‟s the biggest problem with Windows at the moment.”

“If Windows doesn‟t fix the apps, it will lose its push. They definitely

have to get on that.”

“The Nokia music is similar to Pandora, but, meh, it‟s not Pandora. A lot of people won‟t settle for anything else.”

“The typical Nokia and Windows 8 customer is hard to pin down. The people who are buying them range from 16

to 65 [years old]. And they are switching from iPhones 5s and Samsung Galaxy S III, the two most popular

phones in our store.”

“Nokia‟s biggest problem at the moment is the popularity of the iPhone and Android systems.”

“We sell a lot of iPhones every week. We are fully stocked, so 15 to 20 in-store.”

“Why would a customer buy a Nokia when all the salespeople have iPhones?”

“There weren‟t enough ads for Windows 8. There are now though! They are all over the commercials.”

“The problem with the HTC 8X is they overpriced them. You can‟t compete at that price when the Nokia Lumia

920 is $99, and the smaller 820 is $49.99.”

“People love the Samsung Galaxy Tab. It‟s a big seller.”

AT&T store manager, California

This AT&T store sold all six initial Nokia Lumia 920 phones received during Black Friday and expects three to five

additional phones to be sent the week after Thanksgiving. Interest in Windows 8 phones—especially the HTC—is strong,

but does not begin touch the 30 iPhone 5 phones sold during Black Friday sales. The Nokia 900 was a colossal failure

with an 80% return rate, but the 920 is greatly improved with no complaints or returns one week in. Microsoft is copying

Apple‟s approach to a “system” that encourages consumers to sync all of their technology, and the source gave high

marks for Microsoft‟s marketing and Xbox capability. However, it has to

overcome the limited number of apps and the failures of previous Windows

Phone versions.

“Our initial shipment was six phones, and we sold all of them. We

should be getting another shipment of four or five phones in three or

four days. So, yes, the phone is popular, but compare that to the 30

iPhones we sold, there‟s still a long way to go.”

“The iPhone 5 is by far the best seller. The iPhone 4 is free, but we

haven‟t had it in stock for a month.”

“More people have been asking about the HTC 8X. The Nokia has a few

different colors, but HTC is supposed to come out with all these crazy

colors.”

“A lot of what Microsoft is doing is copying Apple. They want customers

to buy into the system—computer, tablet, phone, everything syncing.

They are pushing it as being more convenient.”

“The Nokia 920 is $99 and went to $50 for Black Friday. We got it a

week and a half ago. Lots of people come in asking about it.”

We were initially sent five

phones, and they sold out the

same day. Three were iPhone

users and two were Android.

We just got another shipment

of four today.

Sales Manager, AT&T

California

Our initial shipment was six

phones, and we sold all of

them. We should be getting

another shipment of four or five

phones in three or four days.

So, yes, the phone is popular,

but compare that to the 30

iPhones we sold, there‟s still a

long way to go.

Sales Manager, AT&T

California

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

16

“Windows is a „system‟ like Apple. People get used to it and see it on all their technology, and they become

comfortable with it.”

“The downside to Windows 8 is apps. There are more and more, but it‟s an area they need to work on a lot. Like

in the case of Pandora: People want it and can‟t get it on Windows, so they won‟t get that phone.”

“Because of the tiles, the 920 and Windows 8 phones are definitely social media phones. In that aspect, it‟s

awesome. That‟s the phone to have if you are a social media junky.”

“The software is definitely an advantage, especially on the Xbox. You can transfer music from your Xbox music to

your phone. You can text other Xbox players while playing.”

“The 920 camera is pretty awesome.”

“Microsoft is doing the right thing and spending a lot of money on marketing. They also did that with the 900,

saying it was the future in phones. All of our in-store signage touted it as the best phone ever. And that failed so

we‟ll see in a month.”

“We‟ve had no returns on the [Lumia 920] phone, which says a lot. But you have to give it a month to see. We

had so many returns with the 900. We sold 10; eight were returned.”

Reporter Observations: On a Thursday at midday, three customers and three staff members were in the store. Two

customers looked at and selected the iPhone 5 despite discussing other phone options. A FedEx shipment of five iPhone

5s arrived during our visit. None of the employees had the Nokia Lumia 920. Window signs promoted the HTC 8X; the

Nokia Lumia 920 signs were twice the size but were set back behind the counter. All three associates were helpful and

knowledgeable, and pitched in ideas about the various products.

AT&T store manager, Chicago area

Prerelease inquiries and outside launch-day lines demonstrate a growing interest in Windows Phone 8 and its ability to

compete with Android and Apple. The store sold approximately 15 Lumia 920s on launch day and has sold at least one

daily since then. Inventory is adequate. The Lumia 920 is selling better than the HTC X8 because of the better promotion

and pricing.

“When the Lumia 920 came out a few weeks back, we actually had 10

to 15 people waiting at our door that morning to get it. We also had a

bunch of people calling and asking when it would be in. That alone tells

me there is a growing interest in Windows phones.”

“We have a lot of new phones all the time. With the exception of the

iPhone, we don‟t get lines of people when the phone is released. That

why it was a bit of a surprise when people were lined up waiting for the

Lumia 920. They could give Android and Apple some competition.”

“We are selling more than one Lumia 920 per day.”

“We have plenty of inventory on the Windows phones. I don‟t see us

running out, even if we sell a bunch this weekend.”

“Phones are all so competitive that customers really end up choosing

based on who has the best promotion.”

“As for Windows phones, we have the HTC and the Lumia 920. The

Lumia 920 is selling better just by the fact that it has a better

promotion now. For the Lumia 920, with a two-year contract, the price

is $99.99; plus, you get the wireless charger free and $100 in accessories for $50.”

“The HTC Windows phone is about the same at the Nokia Lumia 920. The price for a two-year contract is

$99.99, like the Lumia, but without the extra promotional items.”

“Ease of use and the accessibility to millions of programs are why customers really like the Windows system.”

“iPhone is still the top-selling phone in the store, followed by the Samsung Galaxy S III, which is the best-selling

Android phone we carry.”

“Nokia is pricing the Lumia to be more competitive in price than the Galaxy or iPhone so that it gets out there.

When people compare the Lumia 920 to the Galaxy S III, their features are nearly the same.”

“When you get a Windows Phone, you can get $100 off a Windows tablet. Some customers have opted for it.”

Reporter Observations: The store was slow during Blueshift‟s Friday afternoon visit. In addition to the manager, four

salespeople were standing around the sales floor. One associate directed a woman in her 50s toward the iPhone 5 and

When the Lumia 920 came out

a few weeks back, we actually

had 10 to 15 people waiting at

our door that morning to get it.

We also had a bunch of people

calling and asking when it

would be in. That alone tells me

there is a growing interest in

Windows phones.

Sales Manager, AT&T

Chicago

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

17

Android phones. The iPhone 5 display was nearest the store entrance, followed by the Windows phones and then the

Samsung Galaxy S III.

AT&T sales associate, New Jersey

The number of customers leaving the iPhone has been greater for the Lumia

920 than for the Lumia 900. Customers are becoming increasingly aware of

their options, and some are ready to try something new. That said, the iPhone 5

still will be the top-selling smartphone this holiday season. The biggest complaint

about the Lumia 920 is the number of apps.

“The Lumia 920 is doing very well. We had a bit of a problem keeping

up with demand the first week or so after it was released, but that‟s

evened out.”

“I notice more people switching over from the iPhones to the Lumia

920 than when the Lumia 900 was released. I think people are starting

to tire of the iPhones and are getting more aware of the fact that there

are other options out there. I would say maybe one in five Lumia 920

purchases are switching over from iPhones.”

“The iPhone 5 will be the top selling smartphone for the holiday

season.”

“The iPhones have a tremendous advantage. People see them as the

phone to have … particularly [those] who don‟t know much about

phones. They do have an advantage when it comes to the number of

apps available, but it is largely due to marketing and brand awareness.”

“The biggest complaint about the Lumia 920 is that they don‟t have as many apps. They are aware of this and

are working to improve. I like the Lumia 920, but what is key for me is a TD Bank app. … Once they have it

available, I‟ll probably switch over to the Lumia.”

AT&T store manager, Georgia

Anticipation for Windows 8 phones was high before the launch, but demand during Thanksgiving was low and has been

less than expected. This store sells one Windows phone per day. The store has a full inventory, which includes three

Nokia models. Still, the source expects the Lumia 920 to sell well through early 2013.

“The response for Windows 8 phones is lower than before they launched. Until then, people were excited about

what the phones would do. Now people aren‟t really looking for them.”

“Nokia has the most popular Windows 8 phone.”

“We sell at least one Windows phone a day. That‟s lower than our expectations.”

“The Windows 8 phones account for 10% of our total phone sales.”

“We have three Nokia models in the store right now, and we have a complete inventory. We don‟t run out

because we get a couple of shipments of phones per week.”

“Sales over Thanksgiving were low for Windows. [Samsung] Galaxy and Motorola [Mobility Holdings Inc.‟s/MMI]

Atrix sold the best. I expect Lumia to sell well through the end of the year.”

“Teenagers are not really big purchasers of the Windows phones—college students, either.”

AT&T sales associate, New Jersey

The Lumia 920 is selling well and has not experienced any stock shortages. Although Nokia is a leader globally, the

iPhone 5 and Samsung Galaxy S III are the top sellers in the United States.

“The Lumia 920 is doing well.”

“I don‟t know how many we have sold, but there have been no issues with stock. The only problem is that some

colors like yellow are order-only and people want to see them in person.”

“There isn‟t just one type buying the Lumia. Some are upgrading from older Nokias. Others are switching from

iPhones or Android. It‟s all over the board.”

“The iPhone 5 will be the winner this season. The [Samsung] Galaxy S III is also a big hit.”

“Nokia is the leader globally.”

I notice more people switching

over from the iPhones to the

Lumia 920 than when the

Lumia 900 was released. I

think people are starting to tire

of the iPhones and are getting

more aware of the fact that

there are other options out

there. I would say maybe one in

five Lumia 920 purchases are

switching over from iPhones.

Sales Associate, AT&T

New Jersey

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

18

Reporter Observations: During Blueshift‟s Tuesday afternoon visit, no customers looked at the Lumia 920. The store

offered a free charging plate with the purchase of the Nokia phone.

AT&T sales associate, Georgia

Demand for Windows 8 phones was nonexistent until recently, and sales of Nokia phones have failed to meet

expectations. The store has only one Nokia Lumia 920 phone in stock. The source does not expect to receive any other

Nokia inventory in the near future.

“No one came in asking for the Windows phone before the launch. I

don‟t think they even knew there was a new phone coming out.”

“I do have a few people come in and ask about the Windows 8 phones.

They like the fact that the phone would be compatible with their home

computer, but the problem is most of them don‟t have Windows 8 on

their computer.”

“The only person I‟ve actually seen with one of those phones was a 10-

year-old kid, and I think he mainly had it to connect to Xbox. They have

cool features, but the phone doesn‟t really do anything for people.”

“We have one Nokia on the shelves, and it‟s been there for months. We

haven‟t sold one Nokia phone.”

“I don‟t think we‟ll sell any Nokia phones over the holidays. They

definitely aren‟t meeting our expectations for sales.”

“We won‟t get any shipments of Nokia phones until we sell the one we

have.”

“Nokia isn‟t offering us any incentive to sell their phones, but the phones are about $99 so maybe that‟s the

incentive for customers.”

“Our [overall phone] sales were good over Thanksgiving. We sold mostly iPhone 4S, iPhone 5 and the Galaxy S

III.”

4) VERIZON STORES Of the two sources, one reported no customer demand for Windows phones, which may change over time as people become

aware of the devices and the OS. The second source believes Windows phones will be as popular as Android and Apple

phones within two years.

Verizon store manager, California

The source reported zero demand for and zero awareness of Windows phones. Windows‟ customer base is limited to tech

people. The store was out of the HTC 8X, which did not concern the manager because of the lack of interest, and Black

Friday sales of Nokia Lumia 822s were weak. The iPhone 5, Samsung Galaxy and Motorola Droid Razr are the top sellers.

RIM‟s BlackBerry product launch in January will do little to help the company.

“There is zero demand for Windows 8, zero awareness.”

“In order to change that, people will have to see it working. Their mom, brother, sister and cousin will have to

have it and make a recommendation.”

“It will take more than one, two or three devices [regardless of brand] to see Windows 8‟s success and for it to

gain awareness. It took Android awhile to gain that kind of awareness too.”

“The only people who want Windows are tech people—people tied to Office and Microsoft products.”

“You will see few to no people who have Apple products buying a Windows phone. The compatibility is not there

with their other products.”

“The Windows 8 ecosystem has a long way to go.”

“Spec-wise, they are comparable to the iPhone and Android products.”

“Windows phones are missing apps like Pandora. Users are lacking the full experience available.”

Reporter Observations: The store was busy during our Thursday afternoon visit. The Windows phones were on a back

corner, and were limited to the HTC 8X and the Nokia Lumia 822 in black and white. The Apple and Android products

were displayed near the front.

I do have a few people come in

and ask about the Windows 8

phones. They like the fact that

the phone would be compatible

with their home computer, but

the problem is most of them

don‟t have Windows 8 on their

computer.

Sales Associate, AT&T

Georgia

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

19

Verizon sales associate, Chicago suburb

Windows will be as popular as both Apple and Android phones within two years. The store has had Windows phones in for

two weeks and sold through the initial shipment of 10 phones within a few days. The store currently has a few each of the

Lumia 822 and HTC 8X. The source also reported selling out of 10 HTC Droid

DNA phones on Black Friday. Apple remains the top seller.

“Windows phones are definitely going to give Android and iPhones a

run for their money. They can already do more than an iPhone. In a

year to year and a half, Windows should catch up to Android in terms of

their capabilities.”

“We got in the HTC Windows phone and the Lumia 822 on Nov. 15, so

we have only had them in a few weeks. We initially got three of the HTC

phones and seven of the Lumias. Both were sold through a few days

from the launch, and then we got some more in.”

“We have Windows phones in stock now. We have two of the HTC and

four of the Lumia 822.”

“The Windows phones did OK on Black Friday. We sold a few. What did

very well was the Droid DNA by HTC. We got 10 of them in the night

before Thanksgiving. Nobody knew we had them. All 10 sold on Black

Friday.”

“The Windows phones are selling. Will they sell as much as Android and iPhones? Probably not yet.”

“The people that get the Windows phones really like them. They are easy to use, and pretty soon they are going

to be able to interface with other Windows products. … That is what they got going for them, and it is huge.”

“iPhones are the easiest to use; that is why they are so popular. And everybody knows the name. They remain

our best seller.”

Reporter Observations: This store did not have most phones grouped by brand except for Apple and Windows phones.

Four customers were present, and most were looking at iPhones and Androids.

5) CUSTOMERS Of these four sources, one was not a fan of Microsoft but now owns and likes the Lumia 920, namely because of its gaming

capabilities. Two others are considering the Lumia 920 because they said its features are on par with or exceed the iPhone‟s.

One of these two also said consumers are tiring of the iPhone‟s recent lack of technological advancement. Our fourth source

believes Windows phones need to be better promoted and that the Lumia 920 is too large.

Man, Nokia Lumia 920 owner, California

The Nokia Lumia 920 is a simple, easy-to-use phone with enough wow factor to convince this source to buy a Microsoft

product. The Windows OS will excel if the apps can be improved. The Xbox capability surpasses Apple TV and is perfect

for gamers. Nokia and Microsoft need to offer in-store demos, free cases and deals to gain popularity.

“It‟s a nice, simple phone. It‟s easy to use for people who have never had a cell phone before and easy for

people who are switching from other phones.”

“I never liked Microsoft, but I‟m impressed with this. … They are going

to totally change the industry if they can pick up Instagram and

Pandora and the other popular apps.”

“My friends were trying to make fun of me for getting the Nokia, but

now that I have it and I‟m showing the features, they love it.”

“I throw it around in my car and don‟t worry about it.”

“For future success, Windows phones need to step up their app game.

They are killing it on everything else. The camera is very, very nice. The

video camera has a stabilizer feature.”

“Gamers are going to love it. They can talk online, find out who is

playing, etc. It‟s a big wow. With the Xbox 360, they should target

The people that get the

Windows phones really like

them. They are easy to use,

and pretty soon they are going

to be able to interface with

other Windows products. …

That is what they got going for

them, and it is huge.

Sales Associate, Verizon

Chicago suburb

My friends were trying to make

fun of me for getting the Nokia,

but now that I have it and I‟m

showing the features, they love

it.

Nokia Lumia 920 Owner, California

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

20

gamers.”

“Apple TV? I have it. But it doesn‟t always work perfectly. It lags sometimes. This is going to kill Apple TV.”

Man in his mid-30s, iPhone 4 user considering the Lumia 920, San Diego

The Nokia/Windows 8 combination is more exciting than the iPhone 5, but the partnership is essential to gaining share.

iPhone 5 sales are being driven more by Apple‟s marketing than its technological advancements. Other manufacturers

like Nokia are making larger technology leaps. Consumers will see the increasing value of syncing all their tech devices.

“If I were presented with the iPhone 5 or the Nokia, I think I would go for the Windows phone. A lot of it is just

wanting something different.”

“I‟m a bit tired of Apple. The iPhone is a good phone, but there was no

leap in technology from the 4 or 4S to the 5. Plus, the 5 navigation

system is rubbish.”

“Apple did a great job marketing the iPhone as the phone to have to be

cool. But since Steve Jobs died, there haven‟t been the technological

leaps. Of course, they are still putting out good products, but other

manufacturers are catching up and passing them. … There are phones

out there that are just as good—and now better—they just don‟t have

the must-have factor yet. That‟s due to Apple‟s great marketing. But the

Nokia with Windows 8 might do it.”

“I am more excited about the Nokia with Windows 8 than HTC with it.”

“I like that the Nokia with Windows 8 integrates with my laptop. … The

way things are going with smartphones, down the line, being on the

same OS will be advantageous.”

“I‟m not worried about the apps. There are going to be lots of apps.”

“I‟ve heard about the Nokia wireless charger being an incentive. That‟s a cool bit of kit, and you don‟t have to

buy a case for it and it‟s still a slim phone.”

“The Nokia Maps are a selling point for me. They are clever and not data-heavy. You don‟t need the 3G or 4G

signal to carry on with the directions. It‟s built into the phone.”

“I have gotten a new handset every year since 1995 and bounced around between several manufacturers, and

Nokia‟s were by far the most reliable handsets.”

Middle-aged man at an AT&T store, Chicago suburb

This source is hopeful Windows phones will take off because of their simplicity, decent memory and camera. He has been

an Android user and is considering a Lumia 920.

“I am hopeful the Windows phones will take off. People are attracted to simple, and the Lumia 920 is simpler to

use than any Android or iPhone.”

“The Lumia 920 is up there with the Samsung Galaxy S III. … It is comparable to anything on the market now.”

”I liked the weight of the Lumia 920. I liked how it fit in my hand. It seems like a really solid phone.”

“I liked the home screen, how it is divided up into all the different tasks you can do. It is really simple.”

“I am interested in a Windows phone. I have always been an Android user, so I could potentially go that route.”

“I like that a Windows phone can be easily integrated with my computer—easier than an Android.”

“I don‟t like Apple. I consider it a cult. I won‟t get an iPhone.”

Middle-aged man shopping for a new phone, Chicago

Because of their newness, Windows phones may need a few years to catch up to their competitors. Although a Windows

phone‟s potential to interact with a computer is enticing, this source most likely will purchase an Android. He likes the

Lumia‟s large screen and ease of use but said the device is too big for his pocket. His top choice is the Samsung Galaxy S

III, but cost is an issue.

“I use Windows on my computer. … That could be an incentive to getting their operating system.”

“Windows might catch up to Android and Apple, but it is going to take a few years. … Companies are not

advertising and promoting them enough. Not enough people know about them.”

“I did a comparison of five phones, and the Windows phone did not come out on top.”

“The Lumia was too big. Even though I do like the big screen, it is just too big for my pocket.”

“I overlooked the Lumia in the store. … It was not advertised or pushed enough.”

Apple did a great job marketing

the iPhone as the phone to

have to be cool. But there

haven‟t been the technological

leaps. … Other manufacturers

are catching up and passing

them.

iPhone 4 User Considering Lumia 920

San Diego, CA

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

21

“They were not giving enough of a discount that day on the phone with a two-year contract to entice me to

purchase any phone, including the HTC Windows model, last week.”

“I would for sure buy the Windows 8 phone if it were offered at a fair price or, better yet, free with a two-year

contract.”

Secondary Sources

Blueshift‟s review of secondary sources found discussion of early sellout reports of the Lumia 920 and of performance issues

for Windows 8 devices, including software freezing and battery life issues. Another source compared the Lumia 920 to the

iPhone 5: The Lumia 920 offers superior voice navigation, touch screen and shake-free video recording, but the iPhone 5 has

a smaller profile and more available apps.

Nov. 27 Los Angeles Times article

This article discussed the early sellout reports by Amazon.com and AT&T for the Lumia 920.

“The Nokia Lumia 920 is starting to make some rumbles in the smartphone market, selling out on Amazon.com

and seeing some wait times on AT&T for some versions.”

“On Amazon, the wait time for Nokia‟s flagship phone is one to two weeks. It sells the black version of the Lumia

920, which launched this month. The Seattle online retailer lists the 4.5-inch screen phone as back-ordered.”

“The black Lumia 920 is also sold out on AT&T‟s website and is listed as completely out of stock. The yellow and

cyan versions of the phone have one- to two-week wait times while white and red versions appear to still be

available.”

“The phone is also sold out in Germany and Australia, according to the Zacks Equity Research analysis firm.”

Nov. 18 article from The Verge

Microsoft‟s and Nokia‟s own support forums have been discussing Windows 8

phone issues, including “frozen” devices and short battery life.

“Windows Phone 8 devices have been available since the beginning of

the month and users are starting to report early issues across HTC and

Nokia handsets.”

“Nokia Lumia 920 users are also reporting random reboots and

freezes, with some complaining of poor battery life too. In a thread on

Nokia‟s support forums, a number of users appear to be complaining

of lock ups and resets with the Lumia 920.”

“Battery life issues have led to some users wiping their devices in hope

of a quick fix, unfortunately that seems to have resulted in some

devices left stuck on a Nokia splash screen.”

“Update: In separate statements to The Verge, both Nokia and HTC

confirms they‟re currently aware of the rebooting issues. „We are

working with Microsoft to investigate these reports. We will provide an

update as soon as more information is available,‟ said a Nokia

spokesperson, with HTC revealing it‟s currently researching the problem at call centers and within its labs.”

Dec. 3 Phonearena.com review

This comparison of Nokia‟s Lumia 920 to the iPhone 5 highlighted the 920‟s unique features such as shake-free video

recording, ability to use the screen with gloves and free voice-guided navigation. Meanwhile, the iPhone offers more apps

and a lighter smaller device.

“There‟s no arguing that the iPhone 5 is one of the most compact and premium material smartphones out there,

built out of glass and aluminum alloys. Nokia, on the other hand, threw every top features it was capable of in

the Lumia 920, including an OIS camera, resulting in a both thick and heavy chassis, made of polycarbonate in

various color choices, and zirconium for the well-situated side keys and the camera plate.”

“This burly impression from the Lumia 920 holds true in comparison with larger screen phones like the top

Androids, too, not only with the iPhone 5. Actually Nokia‟s phone is just a 1.5 ounce heavier than the previous

In separate statements to The

Verge, both Nokia and HTC

confirms they‟re currently

aware of the rebooting issues.

„We are working with Microsoft

to investigate these reports. We

will provide an update as soon

as more information is

available.

The Verge Article

Nokia Corp.’s Windows 8 Phones

1 Ferry Building, Suite 255, San Francisco, CA 94111 | www.blueshiftideas.com

22

iPhone, for instance, yet it‟s the combination of heft and girth that will catch you by surprise given today‟s

smartphone design standards.”

“We are looking at perhaps the two best mobile LCD displays with the iPhone 5 and the Lumia 920.”

“Nokia has employed Synaptics-based touchscreen tech to allow operating the display with gloves, pens and

other objects, which comes very handy in harsher weather conditions.”

“Windows Phone … [has a] somewhat steeper learning curve.”

“The app situation is in favor of iOS, whereas you often find that some services you are used to that don‟t yet

have dedicated apps for Windows Phone.”

“Nokia tries to compensate with exclusive apps like its free offline voice-guided navigation, which is superior to

what you‟d find on the iPhone, or the Mix Radio option, which streams Nokia Music tunes for free to your

handset.”

“The iPhone strikes back with its Siri natural language assistant, whereas the TellMe-based voice recognition of

Windows Phone 8 is more limited in nature.”

“Lumia‟s camera interface offers more adjustments for the images and videos before shooting, whereas the

iPhone 5 mostly decides automatically what to do.”

“In low light conditions the Lumia 920 can soak in quite a lot more light, as the optically stabilized camera

enables it to keep the shutter open longer.

“On one hand, you‟d have to sacrifice quite a bit of comfort picking the Lumia 920 before the iPhone 5. It is

chunky and hefty, and you might find quite a bit of apps still missing from the WP Store, especially compared to

the iOS ecosystem.”

“On the other, the Lumia 920 offers some pretty unique features you can‟t find not only in the iPhone 5, but in

any other handset, for that matter. Things like shake-free video recording with outstanding sound, the ability to

use the screen with gloves, and the free offline voice-guided navigation are not found on the iPhone, so if any of

those is important to you, they might tip the scales in Nokia‟s favor.”

Additional research by Seth Agulnick, Carolyn Marshall, Liana Mortazavi, Maggie Purcell, Tina Strasser, Cindy Elsberry and Lindsay

Gadsby

The Author(s) of this research report certify that all of the views expressed in the report accurately reflect their personal views about any and all of the subject securities

and that no part of the Author(s) compensation was, is or will be, directly or indirectly, related to the specific recommendations or views in this report. The Author does not

own securities in any of the aforementioned companies.

OTA Financial Group LP has a membership interest in Blueshift Research LLC. OTA LLC, an SEC registered broker dealer subsidiary of OTA Financial Group LP, has both

market making and proprietary trading operations on several exchanges and alternative trading systems. The affiliated companies of the OTA Financial Group LP, including

OTA LLC, its principals, employees or clients may have an interest in the securities discussed herein, in securities of other issuers in other industries, may provide bids and

offers of the subject companies and may act as principal in connection with such transactions. Craig Gordon, the founder of Blueshift, has an investment in OTA Financial

Group LP.

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company or industry discussed. Blueshift Research is a trademark owned by Blueshift Research LLC.