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prabhakar_deosthali
Nokia Lumia smartphone is being aggressively marketed in India where there is a ...
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I would not even consider buying a Windows phone. What's the value proposition ...
IHS: Nokia's Lumia 900 to lead Windows Phone resurgence
Dylan McGrath
1/19/2012 1:40 PM EST
SAN FRANCISCO—Nokia Corp. is set to regain some of its lost smartphone market share thanks to the introduction of its Lumia 900 last week—and, in the process, re-establish Microsoft Corp.'s Windows Phone as a leading contender in the cellphone operating system business, according to market research firm IHS iSuppli.
Thanks to Nokia, Windows Phone is set to regain the No. 2 ranking among smartphone operating systems in 2015, surpassing Apple Inc.'s iOS, according to IHS. The firm projects that Windows Phone will account for 16.7 percent of the smartphones shipped in 2015, up from less than 2 percent in 2011.
Windows Phone lost the second place ranking in 2009 due to rising competition from Android and iOS, according to IHS.
“One of the hottest new products unveiled at the Consumer Electronics Show was the Lumia 900, a Windows Phone-based smartphone sporting a flashy set of features that makes it competitive with the best alternatives offered by the Android camp,” said Wayne Lam, senior analyst for wireless communications at IHS, in a statement. Lam said the product represents Nokia’s first step to reclaim its lost market share.
Nokia, once the perennial leader in smartphone sales, fell into third place behind Samsung Electronics Co. Ltd and Apple by the second quarter of 2011, according to IHS.
According to IHS, the Lumia 900’s feature set, along with Nokia’s strategy for selling the product, shows that the company is targeting the North American region. Even at the height of Nokia's dominance, North America has historically been Nokia's Achilles heel, according to IHS.
"The introduction of the Lumia 900 shows that Nokia believes the road back to smartphone dominance runs through North America," said Francis Sideco, senior principal analyst for consumer and communications at IHS. "And the way to win North America is through its operator channels."
IHS said the Lumia 900 was developed with North American market dynamics and smartphone users in mind. The product was first launched in the U.S., a departure from Nokia’s historical approach of repurposing devices designed in and for other parts of the world, IHS said. The firm cited Lumia 900's large 4.3-inch organic light-emitting diode touch screen display, 12-megapixel camera as well as partnerships with Rogers, Telus, AT&T and T-Mobile are concrete examples of Nokia executing on this strategy.
Another feature of the Lumia 900 also illustrates how serious Nokia is about addressing the North American market: its support of the high-speed Long Term Evolution (LTE) 4G standard, according to IHS.
“In the past, Nokia always introduced new technologies in its home European market first,” Sideco said. “However, for the Lumia 900—Nokia’s first LTE phone—the company initially is rolling it out in North America. This demonstrates Nokia’s commitment to re-enter the region.”
Furthermore, Nokia is targeting the mobile network operator (MNO) channel to sell its phones in North America, IHS said. Nokia previously eschewed the MNO approach, limiting its penetration into the region, according to IHS.
IHS said Nokia is also looking to take a bit out of Research In Motion Ltd.'s Blackberry dominance in the enterprise sector, leveraging Microsoft’s business/enterprise sales channels to appeal to corporate customers in North America.
Although Nokia is not the only seller of Windows Phone smartphones, the company is expected to dominate the market, accounting for 50 percent of all Microsoft OS-based handsets sold in 2012, IHS iSuppli predicts. The company’s share then is set to rise to 62 percent in 2013, according to the firm. Nokia’s portion of the market will begin to decline in 2014, as other companies increase their sales of Windows Phone products, IHS said.
"Because of Nokia’s support, apps developers will eagerly shore up the Windows platform," Lam said. "This will cause other makers of Windows Phone devices, such as Samsung and HTC, to offer more products supporting the OS—further expanding the market."
Thanks to Nokia, Windows Phone is set to regain the No. 2 ranking among smartphone operating systems in 2015, surpassing Apple Inc.'s iOS, according to IHS. The firm projects that Windows Phone will account for 16.7 percent of the smartphones shipped in 2015, up from less than 2 percent in 2011.
Windows Phone lost the second place ranking in 2009 due to rising competition from Android and iOS, according to IHS.
“One of the hottest new products unveiled at the Consumer Electronics Show was the Lumia 900, a Windows Phone-based smartphone sporting a flashy set of features that makes it competitive with the best alternatives offered by the Android camp,” said Wayne Lam, senior analyst for wireless communications at IHS, in a statement. Lam said the product represents Nokia’s first step to reclaim its lost market share.
Nokia, once the perennial leader in smartphone sales, fell into third place behind Samsung Electronics Co. Ltd and Apple by the second quarter of 2011, according to IHS.
According to IHS, the Lumia 900’s feature set, along with Nokia’s strategy for selling the product, shows that the company is targeting the North American region. Even at the height of Nokia's dominance, North America has historically been Nokia's Achilles heel, according to IHS.
"The introduction of the Lumia 900 shows that Nokia believes the road back to smartphone dominance runs through North America," said Francis Sideco, senior principal analyst for consumer and communications at IHS. "And the way to win North America is through its operator channels."
IHS said the Lumia 900 was developed with North American market dynamics and smartphone users in mind. The product was first launched in the U.S., a departure from Nokia’s historical approach of repurposing devices designed in and for other parts of the world, IHS said. The firm cited Lumia 900's large 4.3-inch organic light-emitting diode touch screen display, 12-megapixel camera as well as partnerships with Rogers, Telus, AT&T and T-Mobile are concrete examples of Nokia executing on this strategy.
Another feature of the Lumia 900 also illustrates how serious Nokia is about addressing the North American market: its support of the high-speed Long Term Evolution (LTE) 4G standard, according to IHS.
“In the past, Nokia always introduced new technologies in its home European market first,” Sideco said. “However, for the Lumia 900—Nokia’s first LTE phone—the company initially is rolling it out in North America. This demonstrates Nokia’s commitment to re-enter the region.”
Furthermore, Nokia is targeting the mobile network operator (MNO) channel to sell its phones in North America, IHS said. Nokia previously eschewed the MNO approach, limiting its penetration into the region, according to IHS.
IHS said Nokia is also looking to take a bit out of Research In Motion Ltd.'s Blackberry dominance in the enterprise sector, leveraging Microsoft’s business/enterprise sales channels to appeal to corporate customers in North America.
Although Nokia is not the only seller of Windows Phone smartphones, the company is expected to dominate the market, accounting for 50 percent of all Microsoft OS-based handsets sold in 2012, IHS iSuppli predicts. The company’s share then is set to rise to 62 percent in 2013, according to the firm. Nokia’s portion of the market will begin to decline in 2014, as other companies increase their sales of Windows Phone products, IHS said.
"Because of Nokia’s support, apps developers will eagerly shore up the Windows platform," Lam said. "This will cause other makers of Windows Phone devices, such as Samsung and HTC, to offer more products supporting the OS—further expanding the market."
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kdboyce
1/19/2012 2:09 PM EST
Nokia had taken their eye off both the growing competition of smartphones as well as the US market and it will remain to be seen whether or not a Windows smartphone can solve that problem.
It would have been nice if the story had some input for some users. How many people wants a Windows phone vs. an Android phone?
Forecasts by IHS may be right, but alas, forecasts are only forecasts. Reality has a habit of ruining forecasts.
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dylan.mcgrath
1/19/2012 2:32 PM EST
A great question. I will confess I've not seen the Lumia 900, but the idea of buying a Windows phone as opposed to an Android phone does not seem like an attractive idea at this point.
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SylvieBarak
1/19/2012 7:27 PM EST
I'd have to disagree, Dylan. I would actually prefer a windows phone. I have tested the HTC Radar 4G (also Windows) and I loved it. It was a surprisingly pleasant experience. I found it to be much sleeker and more sophisticated to any Android phone I've used to date. Having said that, Nokia has a branding issue in the US and will need to work mighty hard to win people over.
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martin.rowe
1/19/2012 3:46 PM EST
Maybe not the 900, but the 710.
http://www.boston.com/business/technology/video/tech_lab/
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stigskov
1/20/2012 4:50 PM EST
Thanks, this is interesting. Remember that Android runs via Java on top of Linux. A Linux desktop user would probably not be too surprised....
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SI_Rules
1/19/2012 3:50 PM EST
I was a former Windows 5.x, 6.x phone user that switched to Android when I was dissapointed by Win7 phone. While Win8 looks like it will finally have some competetive features, I fail to see why anyone would buy a Windows Phone, even coporate users. And I see even less compelling reason to buy a Nokia phone, LTE? OLED screen? are far from new. Oh and only a hand full of users buy a cell phone based on camera megapixels. It is a third order consideration! ... I think these predictions are completely incorrect!
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AndrewDover
1/19/2012 4:32 PM EST
I too was a former Windows Mobile 6.X user who did not find WP7 attractive. I just recently bought an Android phone.
Microsoft made a fateful design decision late in 2008 to do a new interface in Silverlight rather than fix what they had. Two years later, they delivered WP7. In this case it appears that time to market mattered considerably. Also they lost the support of much of their user and developer base by making WP7 incompatible by UI and API.
I believe they have a few ways to succeed:
1) Make the new Windows 8 APIs (WinRT) succeed and move them down to the phone.
2)Small tablets with IP communication replace the former need for an audio dialtone.
3) Buy T-mobile, and make them sell only Wp7 phones at prices dramtically less than the competition.
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kr6x
1/19/2012 4:41 PM EST
The unfortunate user interface of Windows Phone 7 seems unlikely to support these predictions of IHS. It's not enough to say that the table has already been proven wrong for 2011 numbers. WP7 did not sell 1.9% of the smartphone units in 2011; it barely reached 1.3% bin the third quarter. Microsoft has a lot of work to do before it can hope to sell smartphones; WP7 was poorly conceived -- seemingly imagined by a team of feature phone users rather than smart phone users. Tiles are inconvenient because such a small number of them can be simultaneously displayed. The result is that the rich set of apps that most smartphones are equipped with cannot be accessed on a WP7 phone without extended periods of paging through screens. The selection of the tiles UI limits the user through inconvenience to only a few applications, functionally placing any WP7 phone into the category of a feature phone rather than a smart phone.
And Nokia is the most unimaginable provider of smartphones. Nokia's dwindling business is built around marketing feature phones to the third world at low prices; they seem an ulikely candidate to gain traction selling high end phones. Further, WP7 is certainly positioned to be used only on low end offerings by its design, so even if WP7 someday breaks 15% in units sold in the market, will never capture 5% of market dollars in sales nor 1% in market profit. Couple that with the reality that IHS can't face -- developers will not be producing WP7 apps due to the low likelyhood of recovering development costs through future sales. Customers will always prefer to buy a phone for which apps are known to be available rather than a phone for which few apps of interest are available.
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DeeJee
1/20/2012 3:38 AM EST
Nokia may not be that unlikely to rise in the smartphone market, IF it can deliver an attractive phone. At least in Europe, Nokia has a very strong reputation when it comes to selling reliable phones that keep on working many years without a glitch.
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sharps_eng
1/19/2012 6:00 PM EST
The days when MS could leverage a base of Windows faithful or a world of developers familiar with Windows APIs are gone; and in the phone market those factors probably don't apply anyway.
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kinnar
1/20/2012 4:46 AM EST
Someone who have previously owned windows os phone will never try windows again as it had disappointed the customers a lot in-term of its updates, still if windows mobile os is not backward compatible customers will be totally dissatisfied. Also windows mobile os will have to follow the huge app market which is already grown at lot in case of other OS's.
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SI_Rules
1/20/2012 12:24 PM EST
@kinnar
i believe Win8 will natively support Android apps but i don't know the details
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esuurmaa
1/20/2012 7:24 AM EST
Last year bought N8 (Symbian... :-() solely for its camera; no regrets whatsoever. Happy.
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R. Mark Clayton
1/20/2012 9:44 AM EST
I bought an N8 last year too - great phone. Few improvements and much regression in the Lumia's - even the top of the range 900. Who is going to pay more for a lesser phone?
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askubel
1/20/2012 11:22 AM EST
I remember reading similar predictions last year. I believe they predicted 5% of market share in 2011. Clearly that didn't happen, and I find it very hard to believe that they're going to jump to 9% in 2012. No matter how good WP7 is, we're talking about a 450% increase in market share. Nokia isn't doing anything special enough to make this realistic.
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KB3001
1/21/2012 6:08 AM EST
I would not even consider buying a Windows phone. What's the value proposition really: legacy software, great user experience, a unique app ecosystem, low cost? none of the above!
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prabhakar_deosthali
1/21/2012 8:58 AM EST
Nokia Lumia smartphone is being aggressively marketed in India where there is a large user base of Nokia Phones and Nokia enjoys the reputation of giving reliable phones.
Looks like with Lumia introduction Nokia is back in reckoning in the smartphones market.
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