I know I know, nobody is going to listen to me anyway. But Nokia's Shareholder Meeting is coming up, and some have been asking me how would I fix Nokia today. I wrote a long detailed blog last year telling what was broken and how to fix Nokia overall, not just the smartphones part. Its sad to see it took Elop a year to get around to trying some of the ideas that I insisted Nokia needed to do back then (he is now, for example the 808 PureView is exactly what I suggested). So I will try to keep this short and to the point and focus only now on the catastrophic situation with Nokia's smartphones unit and the Lumia line. And am trying to inject some humor into this rant. Lets see how the sane CEO would behave when faced with, lets say, a hypothetical situation...





( UPDATES TO THIS STORY on 28 March, 11 April & 12 April, see end of story )

LUMIA LAUNCH FAILURE

Your company launches a new platform called Windows Phone, on a new brand of smartphones called Lumia. This is sold in parallel with two other smartphone OS platforms you also support currently, Symbian and MeeGo. The new Lumia phones are introduced in a dozen leading countries in Europe and Asia. Now five months later, you discover that the first Lumia phones are not competitive in the market on their specifications and designs. They receive mediocre support in the press. They receive alarmingly often published opinions suggesting customers are better off buying smartphones by rival manufacturers or ones using your other platforms. Smartphones have traditionally been a key to the profits of the company but currently your smartphone unit is generating a loss.



The sane CEO moves strongly to embrace the hot smartphones on the two other platforms, in particular the highly rated N9 using MeeGo and 808 PureView using Symbian and takes every opportunity to be seen with these desirable phones, and to try to convince all in the media that if you don't like the first Lumia, don't worry, take these alternatives from Nokia instead. The sane CEO would fight Android and the iPhone (and Blackberry) with MeeGo and Symbian, if Lumia is not working (now). Smartphones on the two platforms would be broadly promoted in all major markets including launching the N9 to all Lumia launch countries and the 808 PureView especially in the USA. This could be done while working to improve the next Lumia smartphones to remove the obstacles to their market success.



The insane CEO refuses to be seen anywhere near an N9 or 808 PureView and only insists on talking about the undesirable Lumia. The insane CEO would refuse to even sell the N9 in the European and Asian Lumia markets and refuse to sell the 808 PureView in the USA.

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)



N9 KILLER SUPERPHONE ON MEEGO

Your N9 running MeeGo has received glowing reviews in all markets where it has been released. It alone outsold both Lumia smartphones by a ratio of 3 to 1 in Q4, the first quarter when both were sold, even as Lumia smartphones were cheaper; the N9 was sold in less affluent countries, and the Lumia were sold in Nokia's best markets. The comparison reviews consistently rate the N9 a far better smartphone. It is rated consistently a better value even while being more expensive than the Lumia, in consumer reviews from Australia to South Africa to your company's native Finland. Whereas Lumia phones are manufactured at Compal factories in Taiwan, your own Nokia factories are idling and the N9 could be manufactured at far lower costs in your own factories - the most efficient handset factories on the planet. Whereas the Lumia phones use components not usually used by Nokia, the N9 uses standard Nokia components so the manufacturing of the N9 gain from bulk discounts in its components. Whereas the Microsoft Windows Phone OS causes a royalty payment per handset that Nokia has to pay to Microsoft, the MeeGo OS on the N9 is (co-)owned by Nokia and no royalty payment is needed. The profitability of selling the N9 is far higher than the Lumia, even before marketing expenses are considered. Meanwhile because the N9 is a true flagship phone and significantly more expensive, it would not even threaten to cannibalize Lumia customers. But because of the outwardly similar appearance, the N9 could actually help sell the Lumia. The current attraction of the N9 is so intense, the biggest European handset market, Germany, had the extraordinary review by Germany's biggest newsweekly magazine, Der Stern, suggesting to its readers, they should drive to another country - like Switzerland or Austria - to purchase an N9 because it is truly that good, but inexplicably, the N9 is currently not sold in Germany (rather than to buy an Nokia Lumia which is sold in Germany).



The sane CEO immediately orders mass production of the N9 and releases it to every country and makes massive promotions in Germany, personally appearing in Der Stern inteviews holding the N9. Judging by the Q4 numbers of the few relatively poor and often small countries where the N9 was sold, if it was offered globally, Nokia would sell at least 4 or 5 million N9 units per quarter. This single action alone would return Nokia's loss-making smartphone unit to profitability.

The insane CEO steadfastly refuses to sell the N9 in most of Nokia's best markets, and puts his own ego ahead of the profitability of Nokia.



(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)





RETAIL CHANNEL REFUSES TO SELL LUMIA

You have already admitted in public that many retailers in many countries do not support the Lumia fully. You have mentioned the retailers in the UK as particularly problematic. Now comes news from Nokia's home market where Nokia traditionally had over 80% market share - even higher in smartphones - that the Finnish handset retailers are refusing to sell Lumia. This is the nail in the coffin, really. When your own dogs bite. When sales people in Finland refuse to show Lumia phones when asked for by name! Even as Nokia has massive marketing support and huge in-store displays. Similarly a separate survey by Talouselama of European handset retail stats, says Lumia sales are collapsing.



The sane CEO takes the two other platforms, Symbian and MeeGo, and rapidly pushes several highly regarded phones on those platforms, in particular the N9, the 808 Pureview and the N950 - and rushes those handsets to the retail channel. The sane CEO warmly embraces the Symbian and MeeGo based smartphones and issues a public statement about Nokia's acknowledgement that Lumia needs more work, to restore the retail channel's trust in Nokia. If he feels so inclined, the sane CEO may end the Lumia series or consider relaunching it with new handsets next year. In any case the sane CEO points out the strong synergy Nokia's Symbian has with MeeGo and Nokia's featurephones running S40, to Nokia's developer community, through Nokia's Qt developer tools and Nokia's Ovi store.

The insane CEO refuses to sell the hot new phones on the MeeGo and Symbian platforms, and keeps pushing more and more undesired Lumia handsets to the market.

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)



N950 KILLER SUPERPHONE ALSO ON MEEGO

Your company designed and started production of a second MeeGo based super-smartphone, the N950, as the sister phone for the highly loved N9, last year. This is the QWERTY-slider version, well suited for high text messaging users, Twitter and Facebook users, email and business users, similarly to how Blackberry, Nokia E-Series and Communicator smartphones are used. The N950 uses the highly praised MeeGo OS and is built in Nokia factories, running on Nokia components and could be priced above that of the N9 to be very profitable for Nokia. As none of the four first Lumia smartphone have a QWERTY keyboard, nor does the N9, nor does the 808 PureView, the N950 is the topmost and only modern QWERTY flagship smartphone for Nokia, since the E7 from more than a year ago - a smartphone that in many markets is still the bestselling Nokia smartphone today. The N950 would be in rare status, where for example Apple still refuses to sell a QWERTY version, so only the N950 would be isolated from iPhone rivalry for the approximately 30% of consumers who prefer QWERTY keyboards on their smartphones. The N950 is comprehensively loved by all who have used the device as an exceptionally solid premium smartphone from Nokia. And as there is no comparable QWERTY device on Lumia series, the sale of the N950 now would in no way 'hurt' Lumia sales. There is no downside to launching the N950 everywhere, only a huge, profitable upside.

The sane CEO rushes to launch the N950 to every market now, to capitalize on the good will of the N9 and MeeGo. The launch of the N950 to Nokia's major markets alone would be enough to turn Nokia's loss-making smartphone unit into profit-making.

The insane CEO takes the N950 that its factories already manufacture in trickle levels, and refuses to sell the N950 in any country, only handing out a few of the N950 smartphones to some developers.



(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)





CONSUMERS REJECT LUMIA

Your Windows Phone vision as communicated a year ago was to replace Nokia's Symbian based smartphones on a 1 to 1 basis, with Windows Phone. This assumed Microsoft could deliver a competitive and desirable OS out of Windows Phone version 7.5 and that Nokia's first Lumia smartphones would be well received. Now evidence comes from the early markets that even when supported by the biggest marketing campaign ever seen in mobile history, by the largest handset maker in the world; and then further augmented by a massive support campaign by Microsoft - including giving free Xbox 360 videogaming consoles to customers who buy Lumia 800 smartphones - the customer are not willing to take Lumia smarthpones. The crushing statistics from Britain report that Nokia is now losing a third of its last, most loyal, remaining customers, when pushing the transition from Symbian to Lumia. And British press, such as the Guardian, actually recommend consumers to return their Lumia smartphones. The second hand market and auction sites like Ebay are overflowing with Lumias being discarded.



The sane CEO acknowledges the first attempt at Lumia has failed in the best Nokia markets and reacts rapidly to offer strong substitutes to those markets - in particular the Nokia N9 which has consistently in all side-by-side reviews outperformed the best Lumia 800, and also rush other top Nokia smartphones such as the 808 PureView and N950. The sane CEO would be seen broadly embracing these smartphones and issuing clear statements that Nokia is not abandoning the Symbian and MeeGo platforms - while showcasing how advanced these platforms are.

The insane CEO refuses to sell Nokia's best phones but pushes ever worse and ever less desirable, and ever cheaper Lumia clones to these markets where the first Lumias have already failed.

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)



TABLET FOLLY

Apple is making a ton of profits out of the iPad. The tech press love stories of tablets. The reality is, that if you are a PC maker like Apple, Samsung or Lenovo, a tablet can be a great strategic move. There is a lot of synergy between the PC/laptop business and tablet business, from shared components to the same distribution channel to synergies in marketing, pricing, and branding. If you are a handset maker like Motorola or RIM, to try to compete in the tablet space is lunacy. There are few shared compoents, the distribution channel is totally different, the marketing is different, the pricing is totally different and so is the branding. Apple and Samsung have been very profitable doing tablets. RIM and Motorola found massive losses out of their forays into tablets.

The sane CEO would never contemplate any tablet project as long as Nokia corporation was producing massive losses. The sane CEO would concentrate on Nokia's core business in handsets, and put the biggest effort in restoring the profitability of the smartphone unit. With smartphones even against Apple, Nokia would have many natural strengths from its long history in mobile phones, such as the fantastic camera on the 808 PureView or the swipe touch technology on the N9, to the QWERTY on the N950 etc, to a home-field advantage of still today the biggest installed base of both smartphones globally, and dumbphones who will soon migrate to smartphones.

The insane CEO would squander scarce resources on a futile tablet project, resources desperately needed to fix the leaking ship of the smartphones unit. With tablets against Apple, Nokia would bring no assets and no competitive advantages while facing Apple at its home turf and massive market share domination in both tablets themselves, and compared to Nokia, Apple's considerable installed base of Macintos PCs and laptops.

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation. But Microsoft would ever so dearly love to see someone make tablets for Windows, and Microsoft couldn't care less if that manufacturer made any profit out of it, nor indeed whether it lived or died. Microsoft just wants a tablet to face off against Apple. But I'm not saying Elop is in Microsoft's pocket)





CHINA

The world's largest mobile telecoms market is China. The world's largest mobile phone handset market is China. The world's largest smartphone market is China. The world's largest carrier/operator is China Mobile, alone bigger than all US carriers combined - and twice that number still. Yes, take all US carriers, AT&T, Verizon, Sprint etc, add them together, and then double that number, and its still not as big as China Mobile the carrier is alone. Your Nokia brand is China's biggest handset brand and most desirable handset brand. Your Nokia smartphones have been the bestselling smartphones of China and the Nokia Ovi store is China's biggest app store and the Symbian OS has by a huge margin China's biggest smartphone installed base. Nokia had achieved the exceptional partnership arrangement with China Mobile, that they were a co-developer of the MeeGo OS. Windows Phone has not yet even been introduced a single smartphone model in China by any handset brand, not even HTC or Samsung, while the Nokia N9 has been selling there since Q4 of last year.

The sane CEO issues public reassurances to China Mobile that Nokia will remain with MeeGo and use it as one of Nokia's platforms and to support China Mobile, and to help China Mobile's initiative and software partners to expand the Chinese-language services even beyond MeeGo to other Qt compatible platforms including Nokia's Symbian, S40 and Maemo, and also Android and Blackberry. The sane CEO will immediately commit to producing TD-SCDMA 3G versions of all MeeGo capable handsets today - the N9, the N950 and the older N900. TD-SCDMA is a China-specific 3G standard that for example Apple does not support with the iPhone. Nokia has traditionally provided Symbian based smartphones on TD-SCDMA. Before those Chinese variants are finalized, the sane CEO would rush the N950 to the Chinese market now to capitalize on China Mobile's interests in MeeGo.



I am sorry, I really have to stop here for a moment. Do you realize what this means? Nokia had in its pocket, the monopolistic exclusive rights to 12% of the planet's mobile phone total market! All it needed, was for Elop to go, hat in hand, to China Mobile and promise there will be glorious MeeGo and Symbian smartphones, running Ovi in Chinese, on that TD-SCDMA 3G standard which Nokia already supports fully, and China Mobile would forever block the iPhone and Blackberry and Android and Samsung and HTC and all others from its networks. This is as near to a monopoly as you can hope for. This was the greatest coup in mobile. This was a license to print money. Canalys reported that Nokia's smartphone market share was 77% in China in 2010 - and it was even higher on China Mobile's network obviously. This was Nokia's cherry on the top, just before Stephen Elop's suicidal Elop Effect. And with Nokia's massive factories in China, they could churn out those millions of smartphones at great profit. Any sane CEO sees, this is the most imporant customer relationship that has ever existed in the mobile industry, and you do not screw with it. The sane CEO will turn heaven and earth, to get China Mobile smiling and happy back, to a MeeGo and Symbian based partnership with Nokia. Ok, lets return to my rant...



The insane CEO spits in the eye of China Mobile's commitment to MeeGo, and forces China Mobile to contemplate Windows Phone based, clearly undesirable and globally market-failing Lumia smartphones instead, especially where MeeGo is fully compatible with the Nokia Ovi store and the Qt developer tools, while Windows Phone is not. Where the Ovi store has tons of Chinese apps and Windows Phone obviously has nothing to offer. And the Chinese market has very little utility and compatibility with Microsoft platforms where PC penetration is low, Zune is not popular and Xbox 360 is actually legally forbidden in the market.

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)

SUPERPHONES

Nokia's global brand, price premium and overall appeal has been driven over the years by genuine iconic superphones from the 9000 Communicator to the N93 to the E90 Communicator to the N95 to the N900 to the N8 to the E7 to the 808 PureView. Nokia's flagship phones are expected to showcase technology nobody else has, much like the automotive world looks at the Mercedes S-Class for the ultimate cutting edge tech that will come to normal cars only years later.



The Symbian OS is fully capable of delivering superphones (as is MeeGo for the most part) but Windows Phone is not. Windows Phone is severely crippled when contemplating superphones. Nokia has just admitted, that for example just the camera technology of the 808 PureView, which yes, runs Symbian happily today, won't be able to be put onto Windows Phone based Lumia phones until in 2013 at the earliest. Standard Nokia superphone features like NFC and multiple displays and TV out and HDDI output and enhanced Dolby sound and Augmented Reality etc are simply not supported on Windows Phone. There is no ability to use the Lumia as a WiFi hotspot. Some of the first Lumias have even more problems like not offering forward facing cameras so you can't do videocalls. Not to mention more mundane features we expect like folders and the ability to edit a text message and to display the clock in idle mode and genuine multitasking etc.



A sane CEO will observe from what Microsoft has now delivered on its promised Windows Phone to Nokia's Lumia, and conclude, Windows Phone is not ready for prime time, and certainly not suited for top end premium phones, superphones that can compete head on with the iPhone 4S and Samsung Galaxy Beam etc. The sane CEO will start to issue clear statements that of course Nokia will continue with MeeGo into the future as its OS for the top line superphones - because MeeGo was designed from the ground to be an OS for superphones - and that also Symbian will live on, as it is actually quite well suited as well for many top phone uses from cameraphones to business-oriented QWERTY phones.

The insane CEO abandons the top of the market that Nokia used to rule, to the iPhone and Samsung Galaxy, and only competes in the middle of the smartphone market where every rival is competing and prices are squeezed and profit margins are thin. The insane CEO would continue to suggest that there is no future for Symbian nor for MeeGo.





(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)

ECOSYSTEMS



Yes, the consensus is - and has been for quite a while - that the big race in smartphones is for the ecosystem. The key to the ecosystem is whose OS has the biggest installed base, not the number of apps on an app store for example or some billion-level download number. Your memo told the world what are the main elements of a mobile phone ecosystem as you wrote that after counting the hardware and software, an ecosystem will also include: "developers, applications, ecommerce, advertising, search, social applications, location-based services, unified communications and many other things."



Nokia has recruited the world's largest army of developers to its ecosystem (over 400,000 copies of Nokia's developer kits have been issued, this totally dwarfs all other smartphone developer communities). By the app store, Nokia's Ovi was ranked second best by number of downloads when you took over and is still third best, far ahead of for example Windows Phone. In ecommerce Nokia not only had the world's most widely used mobile content store in Ovi - the bestselling content store in every language except English, Japanese and Korean - ie covering 93% of the planet's population. And Nokia had a huge lead in its mobile money solution, Nokia Money, ahead of rivals like Google. Nokia's in-house mobile advertising agency was one of the first, and one of the world's biggest. And so forth and so forth.



The sane CEO believes what he wrote, that the future is won on the ecosystems and he would safeguard Nokia's ecosystem lead and build upon it. Like how mobile money is a key to customer loyalty and Nokia handset branding in Emerging World countries.



The insane CEO would spit on Nokia developers by announcing that the promised migration path from Symbian via Qt to MeeGo is ended. The insane CEO would sell Nokia's advertising unit and simply discontinue Nokia's mobile money project when it had already won 12% of the mobile money market share in India, the world's second largest mobile telecoms market. The insane CEO would open the door for a rival company's ads to be shown on Nokia screens without Nokia control to potentially threaten Nokia's brand loyalty.

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation. I cannot but be bewildered, what in the world could possess Mr Ecosystem Elop to actually destroy Nokia ecosystem components? I mean, about the only conceivable reason would be if Elop somehow wanted to help Microsoft's ecosystem defeat Nokia's ecosystem? No, that cannot be, Elop is a Nokia CEO)

AFRICA

The largest part of your current customer base and new phone sales are in the 'Emerging World' markets, in particular Africa, India, the Middle East, Indonesia, Brazil, Russia, etc. You talk of the 'next billion' users there. Windows Phone is utterly unsuited for this market. Microsoft itself says Windows Phone OS is not currently suited for low-cost smartphones. Nokia itself said last year that Windows Phone was not suited for the Emerging World markets. Windows Phone is the most closed and restricted environment which in Emerging World markets is far more damaging, where due to problems with cellular coverage, electrical supply, poverty, illiteracy etc - the need to be able to transfer files via Bluetooth, and with microSD cards and using interactive USSD etc is vital. PC penetration is minimal, Microsoft's PC Windows markets share even among PC owners is low and most of Microsoft's platforms are not used such as Zune and Xbox. The ability to use cloud-based file sharing and storage is both prohibitively expensive and incredibly unreliable in these markets.



Nokia's Symbian is perfectly suited for this market, as Symbian is fully functional with modest specification handsets and is fully open in various connectivity from Bluetooth to NFC to microSD to TV-out to HDMI etc. Nokia's Ovi Store is the run-away dominant market leader in this market. Symbian today can power smartphones that cost less than 100 dollars (unsubsidised price). Windows Phone lowest price Lumia costs 250 dollars (unsubsidised price). In the Emerging World markets this price differential is decisive. Morgan Stanley Deloitte told us that 300 million smartphones at a price of under 100 dollars (unsubsidised) will be sold this year. Nokia cannot compete there with Lumia, only with Symbian.

The sane CEO continues to expand Symbian to lower cost smartphones in rough parallel as Samsung and Android, and uses Nokia's scale as a competitive advantage to capture the Emerging World markets to Nokia's Symbian based ecosystem, including Ovi Store and Qt.

The insane CEO tries to push 'lower cost' Lumia handsets like the Lumia 610 - which still costs 250 US dollars (unsubsidised price) and issues statements that Nokia is accelerating the end of Symbian while Lumia is not ready to take over this low end and Nokia has no alternative.

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)





CLOUD COMPUTING

The emerging view is that the future of the whole internet, telecoms and computing industry is headed to the clouds. Nokia believed in cloud computing and mentioned Elop's background in Microsoft's Cloud Computing project as a desirable skill when Elop was hired. One would think he would understand and value the leadership position that Nokia had gained in Cloud based solutions.

The sane CEO would fully support and expand and capitalize on Nokia's leadership in cloud based solutions.



The insane CEO shuts down Nokia's Ovi Share and Ovi Contacts and forces Nokia users to migrate to cloud-based solutions run by rivals.. like Microsoft's Skyshare, Windows Live and Outlook.





(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation. The conspiracy theorist might suggest that Mr Cloud Computing would deliberately sabotage Nokia's cloud solutions just so Microsoft would have less competition. You might think that; I could not possibly suggest such a thing.)





808 PUREVIEW

Your stunning 808 PureView cameraphone with gobsmackingly awesome camera technology won the phone of the show award at the world's biggest mobile telecoms trade show in Barcelona last month, ahead of stiff competition such as Samsung's Galaxy Beam with its tantalizing built-in pico projector. The 808 PureView runs on Symbian, an OS you have previously suggested was obsolete and equivalent to a burning platform. Yet on this magnificent superphone, Symbian does tricks Windows Phone cannot even hope to do this year, from normal Symbian abilities such as true multitasking to abilities more relevant to the camera excellence such as HDMI output. The 808 PureView is receiving the best early reviews of any Symbian based phone ever, even in usually hostile US tech press. The 808 PureView starts shipping in weeks, for example to the UK market.

The sane CEO celebrates the excellence of the PureView, rides the hot press, is seen everywhere with that phone, and uses it to celebrate the competitive advantages of Symbian, its open system, its Qt developer tools, Nokia's Ovi store etc and of course, the sane CEO launches the 808 PureView to the US market immediately.

The insane CEO refuses to be seen near the 808 PureView and even facing strong US media love of the astonishing cameraphone, refuses to launch it in the USA

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation. This could not have possibly anything to do with the embarrassing fact, that even after Elop's Burning Platforms memo, the 'failing' Symbian continued to outsell Microsoft's Windows Phone - in Microsoft's home market of the USA last spring. No, there can't be any such grudge between Redmond and Espoo, could there? And besides, the CEO of Nokia would look after Nokia's best interest, right, not Microsofts in any case)

LOYAL CUSTOMERS

The Lumia smartphones are now obviously a dud. They were not designed by Nokia's A-Team out of Finland, in fact the Lumia designers come from California, from what at best could be called the junior squad, the farm team, the total novices. And now we have seen the evidence is overwhelming. They messed it up rather comprehensively for Nokia's new line of smartphones. The Lumia is just barely suitable to make a good impression in the store, but by the time you bring it home, it will disappoint you day in and day out. Not unlike the complaints about Detroit cars of the past, made to look good in the showroom but a disaster to live with over time (I trust this has long since been fixed with the new Detroit). But its a common accusation of US designs, focusing on the shallow first impression rather than the durable value.



So lets look at Nokia's loyal user base. They have used Nokia branded phones for years, many for over a decade. They have always expected certain levels of utility and convenience and logic and rational behavior on their Nokia phones, whether smartphones or featurephones. How is Lumia today? The user may be impressed in the store. But takes the Lumia home, and tries to move old pictures from the old phone to this new phone or vice versa. There is Bluetooth yes on the Lumia but it won't do file transfer. What of the microSD slot? There isn't one. Shot some video in the camera? Try sending it via MMS? Yes, the Lumia will do MMS and let you send pictures, but not videos. What of messaging? Nokia practically invented mobile messaging (Matti Makkonen, my mentor at Nokia, actually did invent SMS, but he did it at his previous employer, Telecom Finland ie Sonera). So many users, especially the youth and business users, heavily into messaging will tend to favor Nokia phones. Try to draft an SMS text message and save it? You can't. Lumia won't let you save message drafts! What of the FM transmitter you have had for years with Nokia phones so you can connect to your car without cables. There isn't one. What of the TV out you want to show friends your pictures or videos that you shot on the Lumia? Nokia has supported TV out for six year already. The Lumia doesn't do that either. The alarm clock won't wake up on the phone like it used to on all previous Nokia's - a really nasty problem to discover the first time. And so forth.

The sane CEO looks at these serious usability problems, which are all traced to the deficiencies of the Windows Phone OS and the design of the Lumia. The sane CEO decides this Lumia series is now more of a threat to Nokia's reputation - and long term damage to Nokia loyalty - than a way to succeed in the market and will at least limit its production and market launches. The sane CEO will explore less mature markets where the Lumia might succeed even with these deficiencies, like the USA, where far less advanced phones and often phones with crippled features are commonplace. The sane CEO will either end the development of Lumia phones or suspend their marketing in Nokia's main markets like Western Europe and advanced Asia-Pacific, until newer, better Lumia devices of far more modern design can be brought to the market.

The insane CEO pushes even more, even cheaper, even worse Lumia devices to the market to ruin what is left of Nokia's loyal customer base.



(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)

CUTE

Your company has built an application developer tools environment, called Qt. Qt is effectively an ecosystem. Developers can make apps via Qt that work on Nokia's Symbian, Maemo and MeeGo smartphones, today. These have an combined installed base of 300 million smartphones currently in use worldwide. That is the biggest installed base of any smartphone platform. Qt is far more powerful than that. Qt will enable development of apps to Nokia's proprietary 'featurephone' OS, called S40. That means that just on Nokia platforms, Qt reaches a potential of 1 Billion with a B-Billion pockets. Yes. On Nokia's own platforms, Qt is four times as big as Android, five times as big as all iOS devices ever shipped including iPhones, iPod Touch's and iPads, ten times bigger than the Blackberry ecosystem - and 100 times bigger than the Windows Phone 'third ecosystem'.



Qt is a true key for Nokia's global dominance. And I haven't even gotten to the good part yet. Qt also allows development to Android and Blackberry smartphones. Qt is tested to be faster by a whole order of magnitude in development time and development cost. It is by far the best way to develop apps to smartphones. Qt is also compatible (or will be) with other less common platforms such as Limo, bada and Tizen. Of all smartphones in use today, using Qt you have the ability to reach .. 83% !!!!!

And wait. Nokia's new upcoming low-cost smartphone OS, Meltemi - is also of course, compatible with Qt. The total potential reach of Qt is not just bigger than any other smartphone ecosystem - Qt potential reach today is bigger than the total installed base of Microsoft Windows based personal computers and all Windows family smartphones, combined. This is a juggernaut. And the only OS that Nokia currently supports, that is not compatible with Qt is.. Windows Phone. That Windows Phone which is not viable for 90% of Nokia's current market. (Not viable for the high end smartphones, not viable for low-cost smartphones, and utterly incompatible with the featurephone market segment). So Nokia will have to, into the foreseeable future, support systems other than Windows Phone - that are compatible with Qt. You get the picture?



The sane CEO will cherish this enormous power and celebrate Qt at every stage he opens his mouth, repeating the amazing stats about Qt, and fully funds its rapid development so all the platforms will be soon also in production (Qt is not yet finished). The sane CEO will always favor any Nokia solution which is compatible with Nokia's Qt ecosystem, the legitimate 'first ecosystem' of the planet, and always try to avoid mentioning any rivals that threaten Qt.

Only a certifyiably lunatic CEO would waste incredibly valuable and rare media time and attention, by promoting a rival to Qt - the Windows Phone 'third ecosystem' - a product of a competitor company that is unsuited for 90% of Nokia's future. That is not just moronic and mad, it is a direct violation of his fiduciary duty to Nokia's best interests and an obvious conflict of interest. Whether Nokia buys and pays for Windows Phone OS or not, and whether Elop himself thinks Windows Phone might or might not succeed - it is Microsoft's duty to promote that OS, and as long as Nokia produces a rival ecosystem - Qt in this case - it is madness for the CEO to invest his valuable media exposure to promote a competitor to Nokia's ecosystem. He must be fired for this blatant breach of his fiduciary duty. The Nokia shareholders should demand a million dollars for every time he uttered the term 'third ecosystem' in front of a TV camera!





(But I'm sure it wasn't done on purpose, I mean, he'd be a criminal if he promoted Microsoft's interest ahead of Nokia's best interest, and still collected a Nokia paycheck.)

TO BURN OR NOT TO BURN

I think we see the picture. Now, I will end with a little comparison, to burn, or not to burn. Consider these facts.

In Q4 of 2010, just over one year ago, the first full quarter that Stephen Elop was in charge of Nokia, this is how Nokia performed under his watch: Nokia's smartphone unit - the unit of Nokia's handset future - grew unit sales by 7% from just the quarter before. Yes. You read it right. Nokia was not 'declining' smartphone sales when Elop took over. Nokia in his first quarter in charge, grew unit sales by 7%. Was that at the cost of price cuts? No! Nokia average prices of smartphones grew by 14% ! (When does that happen in economic theory, that you increase your price massively, and yet grow sales strongly?) Nokia's smartphone unit revenues grew by 22% from just 3 months earlier! And profits? Check this out. Nokia's smartphone unit profits jumped a Nokia-record of 65% from the quarter before!



Nokia smartphone sales were literally twice as large by unit sales than its nearest rival, Apple's iPhone. (Imagine how much Coca Cola or Toyota or Boeing would love to be twice as big as its nearest rival). Nokia's Symbian was the world's bestselling smartphone OS. Nokia's market share in Q4 of 2010 was 29% of all smartphones sold globally. Nokia's Ovi store was the world's second bestselling app store by downloads. Nokia's smartphone migration rate was 25%, ahead of the world migration rate to smartphones.



Nokia's Symbian OS had as its carrier partner NTT DoCoMo of Japan, the most advanced, most inventive and most innovative company of this whole industry, which not just launched this industry, it has literally invented about half of the total industry's inventions. This carrier was committed to using Nokia's Symbian in its radically futuristic phones for years to come. Nokia also had for the MeeGo OS as its carrier partner China Mobile, the world's biggest mobile operator/carrier. Thus Nokia had exclusive preferred access and market to both the most advanced mobile country and the biggest mobile country, where both NTT DoCoMo and China Mobile had explicitly said they do not want the iPhone! But They wanted Nokia's platforms!



Nokia's credit rating was an A. Nokia's brand was ranked the 8th most valuable brand on the planet by Interbrand. Nokia's shareholders so much loved Elop's first five months in charge, by early February, Nokia's share price had climbed 11% since he took over. That was Q4 of 2010.

Now lets move just 12 months ahead in time, the latest quarter for which we have Nokia data. Now in Q4 of 2011, this is how Nokia performed: Nokia's smartphone unit sales have collapsed 31% from where they were a year ago (while the industry grew 71%). Nokia average sales price has fallen by 10% - but this is by an accounting gimmick, where Elop assigns a Microsoft marketing support payment of 250 million dollars to the price. The real price (what consumers are willing to pay for Nokia branded smartphones) has actually fallen by 16%. Nokia's smartphone unit revenues have fallen by 38%. Instead of reporting a profit of 510 million Euros (663 million US dollars), Nokia's smartphone unit now generates a loss of 190 million Euros (247 million US dollars) per quarter. So Nokia has destroyed 757 million Euros (910 million US dollars, nearly a Billion dollars) of profits per quarter.



Nokia smartphone unit sales now are half the size of the new market leader in smartphones, Apple's iPhone. Yes, Nokia went from being twice as big, to half the size of Apple in just 12 months! Nokia's market share has collapsed to 12%. Nokia's Symbian has fallen to third bestselling smartphone OS. Nokia's Ovi store has fallen to third bestselling app store by downloads. Nokia's smartphone migration rate is now 16%, severely behind the world migration rate to smartphones.



Since Nokia selected Windows Phone, NTT DoCoMo has abandoned Symbian and today runs Android as its primary operating system. Since Nokia selected Windows Phone, China Mobile has become miffed too and today strongly supports Android (and its Chinese variants). Nokia has abandoned exceptional and unique competitive advantages that had blocked Nokia's most dangerous rival.



Nokia's credit rating was downgraded three separate times and is near junk. Nokia's brand fell out of the top 10 for the first time since rankings were published. Nokia's shareholders so much hated Elop's next twelve months in charge, since its February peak, Nokia's share price had crashed 60%. This is Q4 of 2011.

The sane CEO would look at the situation one year ago, conclude Nokia was doing reasonably well, was healthy, profitable - and growing strongly in every single metric imaginable. That is where a sane CEO would say Nokia's platforms are "not on fire". And the sane CEO would say looking at today's situation, that if ever, today Nokia's platforms "are on fire".

The insane CEO looked at the situation a year ago when everything was growing including profits, Nokia smartphone sales and Nokia share prices, and issued a Nokia-wide memo claiming bizarrely that Nokia's platforms were on fire. And truly the Roadrunner cartoon Wiley Coyote moment, using Acme rockets, running over the cliff and then looking down into the canyon and starting to fall.. the insane CEO would look at the world today, and say he feels the platforms are no longer on fire (and that he need not fear Samsung as a rival, he can sleep soundly today).

(The criminal CEO would act in the best interests of Microsoft but obviously I am not suggesting that is Elop's motivation)





THE SANE BOARD

The sane Nokia Board looks at its recently hired CEO, Stephen Elop, objectively and observes that since he took over, he did not focus on his primary task, to fix Nokia's execution. He issued damaging memos and statements that destroyed Nokia's market share, retail support, and trust by consumers and developers alike. He has continued to consistently act against Nokia's best interest and refuses to make obvious right choices such as releasing the two MeeGo handsets globally, yet continues to pursue wild goose chases like tablets. The board would use metrics such as plunging strongly profit-generating smartphones unit to losses, the crashing share price and the disasterous credit ratings and falling brand value. The sane Board would calculate the long-term damage of the wanton destruction of Nokia's previously mightly market share and observe that this year Nokia's market share is headed to single digits. The sane Board would evaluate the long term damage from destroyed partnerships with the leading companies of the industry, the devastation of the ecosystem and the abandonment of all sensible paths to a future from cloud computing to mobile money. The sane board concludes that no matter how clever Elop sounds like in his interviews, the con-artist is an utter fake and a madman who will destroy Nokia with his delusions. The sane Board fires Elop now.

The insane Board looks at the evidence of Lumia failing by every metric, and lets the delusional psycopath go on to ruin Nokia, to sell all its assets from patents to programing skills to the advertising unit to the Vertu unit while the Nokia share price continues to fall.

The criminal Board colludes with Elop or is criminally negligent in ignoring his blatant disregard of the CEO's fiduciary duty and conflict of interest. A criminal Board would face stock market regulator investigations on both sides of the Atlantic. Individual members of a criminal Board would face lawsuits and massive fines and be barred from any Board work in the future. But I am not suggesting the Board is criminal.



THE WAY OUT



The sane Chairman of the Board looks at all of this, understands the CEO has lost all trust and respect and sees the demoralized company on the brink of ruin. He takes the CEO aside, says, this won't work, and tells Elop to go back to Ballmer with an idea. Next the sane CEO manages a divestiture of only the Lumia unit, sell it yes, to Microsoft, and make them take Elop with them. Throw in a 3 year license to use the Nokia brand in the North American market with the Lumia but not for other markets. Pay back the several hundred million dollars so far that Microsoft has paid Nokia. Get rid of all of it. The split is relatively painless, as most of the hardware is from Compal of Taiwan with non-standard Nokia components, so few factories, designers, employees are involved. The Windows Phone software is obviously also mostly Microsoft so again, few Nokia staff would be involved.



The insane Chairman of the Board watches as the proud Nokia ship slowly sinks as the clown CEO, no, thats not fair to clowns. As the Microsoft Muppet CEO blasts ever more holes to the sinking ship, below the waterline and just boosts the speed by which Nokia sinks. And the proud legacy of the Chairman, thought by most in his home country as its greatest industrialist and even in European circles held in highest esteem, rapidly sinks along with it.



NOKIA CAN BE SAVED





Nokia can be saved. I am not saying Microsoft Windows Phones have to be discontinued (while it would be the best move right now, in my estimation). I am saying the magical MeeGo devices, N9 and N950 have to be sold globally now, now when they are hot, and can command a good price, and bring Nokia back to profits. The CEO has to commit to MeeGo also into the future and restore the damaged relations with China Mobile. Symbian is best suited for Africa and Emerging World markets until Meltemi is available. Qt is Nokia's smartphone strategy and the only OS that is incompatbile with Qt is Windows Phone. Lumia has been tried, it is failing now. Nokia had a superior ecosystem a year ago, now Elop is destroying it piece by piece. He has to be stopped while there is anything left. For Nokia to survive as an independent company, it must take drastic actions now. The first step is strong embracing of MeeGo and the N9 and N950, globally in every market from the UK to the USA. And Elop is utterly incompetent, he has to be fired!





UPDATE 28 March, 2012 - Nokia finally takes partial step in right direction! Nokia reported at Netbook News quoting info from Mary McDowell and Nokia's 'Next Billion Group' - that Nokia is now developing not one but two lower-cost MeeGo devices, (hooray! Finally! Some sanity at Nokia HQ! We celebrate!) aiming for the Emerging World markets. Note this completely reverses the idiotic statements CEO Stephen Elop said less than a year ago about MeeGo. Good move Nokia, more of this. Except why is CEO Elop not running at the front of this story? Why is he refusing to be seen near any MeeGo story about Nokia! And now, EVEN MORE WITH THIS DRAMATIC NEWS DEVELOPMENT, if there are new MeeGo devices coming - and there is unprecedented press support of the N9, why not release the N9 and N950 on MeeGo now, sold in every market now, to help support the interest in, and future sales of those upcoming newer and cheaper MeeGo devices.

UPDATE APRIL 11



For anyone still reading this blog, Nokia just issued its profit warning today and I have commented on it and crunched some numbers. In 2011 Stephen Elop set the world record for biggest destruction of a Fortune 500 sized company any one year. Now in Q1 of 2012, he went even better, producing the worst quarter results ever seen anywhere. Read my view of the Nokia Profit Warning and why things are even worse.



UPDATE APRIL 12



I have written a 'proper' and not very 'Elop sucks' type of posting, honestly, accurately, precisely, comphrenesively, with facts and stats, about what is not wrong, and what is wrong, and what must be done, if Nokia is to be saved. If you want to read it, it is here The Hearbreaking Fact is that Nokia Can Be Saved and within one Quarter at that.