Nokia at Barcelona’s Mobile World Congress: First Windows-based Nokia phone may be introduced already in 2011
Before the Mobile World Congress, the GSM Association’s annual main event, even got under way properly in Barcelona, the field’s new hot direction already became clear on Sunday.
Samsung and Sony Ericsson announced that they would introduce a total of five new mobile phones based on Google’s Android platform.
The world’s largest mobile phone manufacture, Finland’s Nokia, in turn is not launching any new handsets in this year’s event.
Having said that, Jo Harlow, Nokia's executive vice president in charge of Smart Devices, hinted that the company might introduce its first handset utilising the Windows operating system already this year.
“I would be pleased if the first Nokia Windows phone was ready already this year. There is a lot of pressure for that”, said Harlow, who will join the Nokia Executive Board in April.
Nokia CEO Stephen Elop, in turn, emphasised that the exact launch dates of new devices will be only published once the company can be absolutely certain of the accuracy of such announcements. In the last couple of years Nokia has been forced to postpone the introduction of several new products because of software problems.
According to Harlow, the semi-retired Symbian platform will still receive further software updates that will improve the user interface experience.
According to Harlow, Nokia will still be relying on Symbian on certain products for years to come.
At the start of his press conference, Elop emphasised that Nokia and Microsoft will both benefit from the teaming up.
According to Elop, Nokia will receive a “massive” compensation to the tune of billions of dollars from the American software house from the joining of forces by the two companies that was announced on Friday.
The paying of the compensation is justified by the fact that Nokia has a lot of software knowhow that it has accumulated during the years of research and development spent on Nokia’s own Symbian platform.
This compensation was not mentioned clearly enough earlier, Elop said on Sunday.
Nokia’s Friday announcement of cooperation with Microsoft was initially received with scepticism, causing the Finnish company’s share price to plummet by 14 per cent on the Helsinki Stock Exchange.
According to Elop, one reason why Nokia decided against joining the Android clan was the fact that Nokia’s massive sales figures would have made Android a completely superior operating platform compared to anything else. This would have had a detrimental effect on free competition.
In Elop’s view, cooperation with Microsoft will also provide Nokia with some sales and marketing support, which will reduce Nokia’s own expenses.
Through the tie-up with the American software manufacturer Nokia will also be able to cut down its research and development costs.
Furthermore, joining forces with Microsoft will also provide the Finnish company with revenue from the services cooperation side, Elop added.
According to Elop, the scale of such benefits may be in the billions of dollars, once Microsoft begins to use Nokia’s digital maps and location services.
The comments of a possible early release and revenue prospects initially boosted the Nokia stock in Helsinki, but investors remained jittery, even in the face of positive statements by the Microsoft CEO Steve Ballmer in Barcelona, and by lunchtime Nokia was down around 3% in choppy trading.
The share eventually closed at EUR 6.63, down just over 5% from its opening price of EUR 6.88.
The stock is now just a few cents above its low point during the past decade.
Nokia's slide carried with it the shares of some Finnish subcontractors, whose valuations took an even greater hit.
Software companies Ixonos and Digia lost 18% and 12% respectively, amidst fears that the agreement with Microsoft will turn Nokia into a low-margin hardware manufacturer without any significant software development component.
The worry is that the anticipated phase-out of the Symbian and MeeGo platforms in favour of Windows Phone 7 will hurt subcontractors and cause a major structural change in the technology sector in Finland.
One estimate made in the course of Monday was that as many as 5,000 jobs in product development could be at risk.
More on this subject:
Nokia President and CEO Stephen Elop holds 500,000 Nokia stock options
Previously in HS International Edition:
Announcement of strategic partnership with Microsoft leads to sharp falls in Nokia stock in Helsinki (11.2.2011)
Mobile World Congress
An article in the online magazine Engadget shows images of what are claimed to be concept prototypes of a new Nokia phone using the Windows Phone 7 OS
Nokia Press Releases