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What Will Nokia's Comeback Look Like?

Posted by Marc John Villestar | September 19, 2016

Nokia was one of the most popular mobile phone companies in the late 90’s and early 2000’s. The company used to be ubiquitous, doing business in more than 150 countries, employing 61,656 people, and taking in revenues of around US $14.28B.


Enter the smartphone era.


Nokia slowly began to fade away from the limelight. It was dubbed the most famous casualty of iOS and Android’s rise to prominence. Unable to catch up with other phone companies, Nokia was pushed to sell its phone business to Microsoft in 2016. Apart from making Lumia phones, the company stopped pursuing the smartphone market.

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But a comeback is happening. In May of this year, Nokia signed exclusive rights with Helsinki-based company HMD global Oy, granting the manufacturer rights to produce Nokia mobile phones and tablets for the next 10 years. This August, Pekka Rantala, CEO of Angry Birds, was hired as Chief Marketing Officer for HMD. "There are very few opportunities like this, to work with a global brand with the power to touch hundreds of millions of people every day," says Rantala. His top priority will be to build a team of marketers and communications experts. He will lead the responsibility of bringing the Nokia brand back into the global market. HMD plans to spend around US $500M over the next three years to market Nokia-branded phones and tablets.


In the agreement, Nokia is entitled to royalty payments from HMD for sales of Nokia-branded mobile products, covering brands as well as intellectual property rights. In addition, Nokia reportedly acquired French consumer electronics company Withings, to establish the company’s renewed intentions to make a comeback in the consumer electronics market.


Tough Competition

Nokia dominated the market when the first iPhone was launched. The Nokia 5200 was a top seller, but iPhone’s revolutionary design led Apple’s market share to rapidly increase, and Nokia’s to plummet. Nine years later, the smartphone market is far more diluted—leaving some potential for Nokia to innovate beyond the existing players’ offers.

In Vietnam, the mobile phone market looks different. The market is dominated by Samsung, with a 34.7% market share, Oppo, with a 21.8% market share, and Apple’s 9.8% market share. According to some analysts, Nokia has a chance at making an impact, high enough to compete with the mentioned brands. The company phone brand never disappeared from the country. As per some reports, FIH Mobile, a subsidiary of Foxconn, may produce two new Nokia models that are set to debut at the end of this year.

What the comeback looks like

Nokia’s brand is still strong. Most people probably owned a Nokia at some point in the past. The Lumia line, upon its release, was praised for its sleek style—but its lack of success was due to the limitations of its operating system, which at the time offered few apps and numerous issues. The new Nokia will run on Android, but this will mean direct competition with Samsung and other brands that uses the same operating system.


The former “King of Mobile Phones” is rebranding itself in hopes of reclaiming its glory. Nokia is expected to undergo an overhaul in design, form, and specifications. Rumor has it that the company will offer two flagship phones in 2016, with up-to-date specs like 5.5 OLED display, Snapdragon 820 processor, IP68 dust and waterproof rating, metal body, and 2K/QHD resolution. Nokia is expected to embrace innovation by releasing a range of flagship phones, from high-end models to more affordable units.


This time, Nokia should not worry about its software. Running on Android, the largest of all operating systems, the company can focus on what it does best: hardware.

 

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