Nokia Lumia pricing comparison

As always Nokia today gave a price indication with launch of new devices, Lumia 800 and Lumia 710. The price is of course always "excluding taxes and subsidies" because local taxation and market situation will affect the price.

To estimate the real street price of phones, here is a small table to show how Nokia estimated prices for some of their latest smartphones so that you can compare the Nokia estimated price and real street price when phone finally became available. Is Lumia 800 expensive or not, you can judge yourself. Looks to me that Lumia 800 should retail much cheaper than N9 16GB, but comparison is somewhat difficult because Lumia 800 (France, Germany, Italy, Netherlands, Spain, UK) and N9 availability areas don't overlap.

Device	Estimated price	Estimate given
Lumia 800	420€	26.10.2011
Lumia 710	270€	26.10.2011
N9 16GB	480€	27.9.2011
N9 64GB	560€	27.9.2011
E7	495€	14.9.2011
N8	370€	27.4.2010

//Harri

Nokia's value is falling

It's been a while since latest post to this blog, I've more or less moved from blogging to Twitter as that medium is much more conversational. This time I just didn't manage to compress my thoughts to 140 chars.

Today, September 21st, Nokia's market capitalization is 15.7 billion euros and stock price has fallen 46% this year (Source: Nasdaq OMX).

Another fact is that Nokia's total cash and liquid assets were 3.9 billion euros at the end of second quarter this year (Source: Nokia's interim report).

It is also a fact that Google acquired Motorola Mobility in August, mostly for its patents, for 12.5 billion dollars (approx. 9 billion euros). According to reports, Nokia's patent portfolio is better than Motorola's both in terms of quantity and quality and for example every iPhone sold generates royalties to Nokia.

How Google actually evaluated Motorola's patents is not known, so we must make a wild assumption. Let's assume that over half of Motorola's value was coming from patent portfolio and because Nokia has more and better patents, we can round sum up a little bit. Let's say Nokia's patent portfolio is worth 7 billion euros, quite possible figure based on Google's Motorola deal. (In fact after Motorola deal J.P. Morgan valuated Nokia's patent portfolio to 5.4B€, but wildest evaluations were close to 20B€).

Now it's time for some math:

Nokia's market capitalization 15.7B€
- Nokia's cash assets 3.9B€
- Nokia's patent portfolio 7B€
= 4.8B€

This calculation shows that without cash assets and patents Nokia's core business is valuated below 5B€, or to put this in different words, only 1/3 of Nokia's value comes from what they do today.

However, Nokia owns 50% of NokiaSiemens Networks, Navteq maps (when Nokia bought Navteq price was 8.1B$), has factories all over the world, sold in last quarter over 100 million devices, more than 1.3 billion people use Nokia devices every day and Nokia is still one of the most recognized global brands. Despite reductions, Nokia has an army of talented people working every day to create new devices that their effective manufacturing and logistics can push through their global sales channel practically to every village in this planet. Yet, that doesn't seem to have much value.

Or maybe investors just don't believe that life as Microsoft's hardware department will be great business.

//Harri

I'd take the browser

I just realized that once again I am going against the flow, and this time it is about whether to do mobile applications or mobile websites.

I think it was back in 2001 when I made my first mobile application, it was for Nokia 9210 and Symbian was still called Epoc. To make an application for that device was a very painful process, supporting documentation was nonexistent, there was hardly anyone to ask help and SDKs and tools were jurassic. When application was ready, users didn't dare to even try installing it, because the whole concept of installing stuff to telephone was beyond their comprehension. Despite of that I wanted to create applications and not browser content.

Constantly I was challenged about applications vs. browser question. Users had just experienced the transition from desktop applications to desktop browser solutions and of course wanted to know why mobile world was different compared to desktop world. The reasons for applications were simple: terminals were lacking many features and only applications could fill those gaps; data networking was very expensive, unreliable and circuit switched; browsers supported only WAP and user's didn't even know how to configure it. That's why I wanted to create applications, luckily there was no fragmentation at that time.

Fast Forward 10 years.

Today's devices are primarily internet data satellites and most of them have capability to do also old-fashioned voice calls. Devices are online all the time, switch between networks transparently and some have better screen resolution than office monitors had ten years ago. Devices are filled with capabilities, including great (or bearable - you know who I mean…) browsers. At the same time new device platforms pop up everywhere, old platforms get updates, fragmentation spreads around the business and still applications are the most hyped thing. It doesn't make sense. No matter which platform you choose for your application, you rule out most of the users. If you pick browser solution and implement it wisely, you can reach 96% of devices instantly if that is needed. Today I can't help suggesting customers by default to choose browser and forget applications, unless a real reason exists to decide the opposite. Because typically browser is also cheaper choice, customers can invest remaining budget on marketing and attract users that way. When your first application is published, you have just scratched the surface but with browser you probably are done already.

Why everybody then wants applications today? Probably because it is so easy to go with the herd and application stores give you visibility and some coolness-factor? Of course there are cases when an application is a must, but looking at top-100 applications from any listing you can easily see that "let's duplicate our browser content with our application" is the most common specification used. And if you think application store is a great way to get publicity for your application, you certainly are not alone. In Apple AppStore only you have over 300.000 friends, sharing your hopes.

//Harri

John Wayne trying to save Nokia

A couple of days ago Helsingin Sanomat published an interview with Olli-Pekka Kallasvuo, Nokia's former CEO who got sacked this September. In this personal interview OPK tells about his feelings for the first time after he stepped down from his Nokia position. It's a good read, please take a look.

For quite some time Nokia hasn't been famous for innovative products and its new rivals have made Nokia look like an old struggling giant. Nokia has been hit by the Innovator's Dilemma.

Think for a second what would you need in order to be "innovative". I'd list things like time to think, seeing things from a new perspective, vision about future, sharing ideas with unexpected people and hard work - and this is just a start.

Then read carefully OPK's interview, especially the part where he tells about his work routines. Twelve hours spent daily at the office and after that working some more from home. He had vacation only a couple of days annually and for five years he couldn't visit trot races - his favourite hobby. Christmas lunch with friends he had this year first time in fifteen years!

How do you think an organization acts when the leader works like John Wayne, trying to alone save the entire company? My guess is that next management levels are trying to follow him, because they think it is the right way to work in this company. The more you work, the better you are and get closer to promotion. No casual meetings, no lunches with friends, no hobbies, no vacation. Just work.

If you work like that, you will lose most of the things that I feel are the requirements for innovations. If you don't have any slack in your calendar, when does your mind work freely? If you don't even have time to meet friends, how can you get exposed to fresh thinking? If you work like that, can you evaluate the innovations presented to you and decide where to invest?

Another small detail that caught my eye was that OPK will probably never buy an iPhone, he wants to remain loyal to Nokia. Many times I've thought that Nokia's top executives shouldn't only be allowed but instead forced to use their competitors' products in everyday use for a month or so. If they see something nice in their products, Nokia could proudly imitate those features - that's what their competitors do, anyway. And finally they would know what struck them.

//Harri

Ovi Store disappointment

Earlier Nokia's Ovi Store has had some usability challenges, to put it politely. Having used new Ovi Store for some time with N8 I've been quite happy with it as there has been a major improvement to user experience. Application discovery and installation work acceptably and sometimes I've even found myself browsing the store just to see what's available.

After many installed applications I started to wonder that I never received any notifications about application updates. You know, sometimes developers do make mistakes and release fixes for those or even add new features to applications. Must say I was shocked when I was told that missing update notifications was not because Nokia developer ecosystem has reached the ultimate quality level but because Ovi Store doesn't support update notifications!

Ok, no update notifications then. Before application is installed from Ovi Store, there is a button to download the application and after installation is finished, the same button allows me to launch the application. I can't download the same application again - is the purpose that I must uninstall the application before update?

How am I supposed to update an application I've installed from Ovi Store if I know an update exists?

How would I know there is an update available because Ovi Store doesn't show version numbers?

Why does Ovi Store offer me the same application again and again for download even if I have it already installed?

Has somebody really wrote specification that states this is the way an application store should work?

Below are some screenshots if Ovi Store is not familiar to you.

//Harri