Brick Phones to 5G
Nokia. The Finnish company that took the mobile markets by storm.
You may remember them as the mobile phone company that dominated the ’90s and early 2000s.
In 2000, Nokia released the Nokia 3310 — affectionately known as “the brick.”
It became the iconic phone to have, boasting form and function…
As well as being nearly indestructible.
The phone sold well, selling over 120 million units and becoming the iconic phone for Nokia.
By 2000, Nokia accounted for an insane 4% of Finnish GDP and held 70% of the Helsinki Stock Exchange market cap.
Eventually, though, Nokia’s brick phone style would become obsolete. And it would fail to keep up in the competitive smartphone market.
A 2015 paper detailed Nokia’s fall from grace and pinned it on three reasons: inferior technology to Apple phones, arrogance among top-level managers and a lack of vision.
In 2013, Nokia sold its smartphone business to Microsoft. After which point it could focus on its core business: hardware and licensing.
And with the announcement of 5G, Nokia seemed sure to turn their prospects around…
Nokia’s New Hope
2017 was year that 5G was first announced. And the global telecom equipment companies raced to be the first to capture market share.
And as of early 2018, they announced they were ahead of schedule to roll out 5G networks.
As of last year, Nokia still was a major player in the global telecom equipment front…
Capturing over 15% of the global market share, as shown in the graph below.
And yet even with Huawei being sidelined by the U.S. government, Nokia hasn’t been able to make any meaningful steps toward 5G deployment.
So what went wrong?
The same problems that plagued their smartphone business have plagued their 5G deployment: operational inefficiency, major competition and the inability to keep up with the technology around them.
Add onto that the enormous cost of deploying 5G products and you can deduce why Nokia’s underwater.
Earlier this week their CEO, Rajeev Suri, stepped down over the inability to get Nokia ahead of the 5G competition.
Whether or not this change in power will turn the ship around is anyone’s guess.
But I believe that the company suffers from more than just the inability to innovate.
They seemed primed to capture a huge swath of 5G deployment if they could just get their act together.
When you ask yourself the question who will be the first to roll out 5G, take the lessons from Nokia into account.
To a bright future,
Chief Technology Expert, Technology Profits Daily