Is This Former Giant Heading to Its Doom’s Day?
aromita is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Nokia (NYSE: NOK) once dominated the cell phone market with a mammoth 50% market share, yet it has fallen some 90% since the launch of iPhone in 2007. Lumia 920 could be the last major shot at reclaiming their market share which they lost to Apple Inc. (NASDAQ: AAPL), Samsung & Google Inc. (NASDAQ: GOOG). The hopes from Lumia for Microsoft (NASDAQ: MSFT) and Nokia took a beating as the share price of Nokia fell by around 15 percent after the phone was made public. The phone has very few distinguishing features and it also lacks the X-factor to make it a hot seller in the market.
Lumia 920 & smaller Lumia 820 run on the latest Windows 8 operating software, which Microsoft hopes would challenge Apple’s iOS and Google’s Android to become the third mobile platform. Honestly if these phones do not entice the buyers soon it could be the last nail in the money-losing Nokia coffin and would also hamper Microsoft who is trying to get a foothold in the market. Nokia's discretion about prices, dates or carrier partners also backfired.
What Makes it Stand Out From the Rest?
The Lumia 920’s “Pureview” camera technology which reduces blurring from hand motion, has wireless charging capability and a Snap Dragon processor comes with amplified reality technology that lets users see particulars of their background through the camera. It’s got a non-reflective display, looks sleek, insightful and appealing and has a very receptive OS. Nokia really believes that this technology would give them an edge over the rest. It also uses a “floating lens” system to deliver the most favorable image stabilization.
Nokia has not yet revealed its partnerships with any of the wireless service providers (AT&T doing the rounds) which might incite a sign of weak carrier support. If Lumia sales are a massive hit it would help Microsoft convince other handset makers and carriers to support Windows Phone 8 which promises faster performance and a start screen which can be customized.
In the past 18 months it has lost more than $3.8 billion and has made about 10,000 people jobless.
Apparently Microsoft has made it obligatory for a consumer to buy a new phone to upgrade to Windows 8. Even if a customer does so, the chances are very less that they won’t repeat it again after six months? This kind of strategy from Microsoft could be bad for Nokia as well.
Competitors such as Google’s Motorola Mobility, and Amazon.com’s Kindle Fire are going to launch their tablets soon. Windows phones has 3.7%, Android phones have massive 68% while Apple has 17% of the global smartphone market.
Where have the Nokia-Microsoft features & applications gone wrong?
- It gives substandard camera performance in low light conditions
- It has Bluetooth connectivity issues
- It supports only 100,000 or so applications with respect to more than 500,000 or more for Android or iPhones.
- The Lumia 920’s Full HD video recording only stores mono sound i.e. it won’t record stereo sound, although it has an advanced microphone assortment.
What Should Nokia do to Make Things Better?
Nokia and Microsoft would have to promote their product in the right way to catch the public’s attention and tell them what exactly their strengths are, what these products can do for them, how much would it cost, where and when they can buy them? They should flood the TV, Radio, newspapers, magazines and the web with advertisements. They should collaborate with the Verizon network to augment its sales in the United States along with the other carriers similar to how its counterparts have done, which would advertently mean more sales.
The new Lumia could benefit from the diminishing sales of blackberry and also from the recent obstacles for the Android operating system. Windows phone 8 is akin to the Windows 8 desktop and tablet software (Due for a release on 26th October 2012), which would make it convenient for developers to inscribe apps for both. Microsoft believes this would make the platform well-liked. All said and done it lacks that dazzle or spark to simply win the market hands down, or is it that its not out yet which would knock out all its competitors? Only time would tell!
tanukar has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Amazon.com, Google, and Microsoft. Motley Fool newsletter services recommend Amazon.com, Apple, Google, and Nokia. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.