Nokia’s Demise: Don’t Blame CEO Stephen Elop, Windows Phones
CEO Stephen Elop continues to bet Nokia (NYSE: NOK) on Microsoft’s Windows Phone 8. Some skeptics are losing faith in Elop and Nokia, which has imploded while Apple iPhone, Samsung Galaxy and Google Android smartphone sales soar. But before you criticize Elop (pictured), maybe partners and customers should turn their attention to Nokia’s decade-long missteps and overlooked opportunities under former CEO Olli-Pekka Kallasvuo. Here’s why.
Sure, Nokia has stumbled during Elop’s first year of CEO leadership. The company’s Lumia 900 Windows phone, only about three months old, is a dead-end product because Lumia 900 partners and customers can’t upgrade the smartphone to the Windows Phone 8 operating system, which Microsoft expects to ship later this year.
Nokia’s (NOK) latest quarterly earnings results were stronger than expected, but skeptics are losing faith in Elop’s turnaround plan. Nokia’s revenues, profits and market share have plummeted since Apple launched the iPhone in 2007. The most glaring evidence: Nokia shares are down from $39.71 in 2007 to $1.71 on July 20, 2012. Ouch.
Nokia’s problems and missteps were a decade in the making . Even the most optimistic observers should not expect a fast turnaround at any point. An in-depth Wall Street Journal report on July 19 revealed how Nokia had a touch-screen smartphone strategy and tablet computer concepts in place more than seven years before the iPhone arrived. But in the mid-2000s, Nokia grew bloated and overly focused on traditional cell phones. Nokia’s CEO at the time: Kallasvuo.
Now, Elop (a Microsoft veteran) is in a high-stakes poker game but he’s only holding three cards: Nokia’s cash, Nokia’s patents and forthcoming Windows Phone 8 smartphones. Is that a strong-enough hand to return Nokia to its earlier glory? The VAR Guy doubts it. But don’t blame Elop. He was dealt a lousy hand when he accepted the job.