Richard Green, Nokia’s CTO, left the company today in order “to attend to a personal matter,” Nokia said. Nokia told The New York Times that Green’s return has “no specific timeline” and that the head of Nokia’s Research Center, Henry Tirri, would fill in for Green. The news of Green’s departure continues a string of personnel changes dating back to September, when Stephen Elop, then at Microsoft, was named Nokia’s new CEO.
Om and I briefly chatted this morning about the continued turmoil and he suggested the wheels may be falling off the company. I actually disagree: As I see it, the wheels have already fallen off and Nokia is simply skidding down the current road on the momentum it built as the world’s largest seller of handsets. Without wheels, that pace will stop, as evidenced by the company’s recent lowering of second-quarter and year-end outlooks. The situation has even caused Nokia to say it won’t be providing any future guidance. Sorry, but that’s not the simple problem of a blown tire.
Just one look at Nokia’s recent journey illustrates the problem:
- February, 2010. Nokia merges its Maemo platform with Intel’s Moblin to create MeeGo, a mobile operating system that “will knock the socks off competitors,” I was told by a Nokia executive.
- April, 2010. Nokia announces the N8 with a new version of Symbian to help it compete against growing platform share from Apple iOS and Google Android. The handset arrives in October to lackluster reviews.
- September, 2010. The company looks outside the Nordic region and replaces Olli-Pekka Kallasvuo with Stephen Elop as CEO.
- February, 2011. Elop drastically changes Nokia’s strategy of building both hardware and software by announcing a $1 billion partnership with Microsoft to use Windows Phone 7. Additionally, MeeGo is relegated from smartphone savior to second-class citizen as Elop calls it experimental going forward, dropping Intel like a bad date.
- May, 2011. Amid low-cost Android handsets in Europe and Asia, Nokia says it expects Devices & Services’ operating margin to be substantially below its previously expected range of 6 to 9 percent, possibly becoming break-even.
- June, 2011. Nokia stock hits a 13-year low.
I suspect Green doesn’t agree with the strategic changes, although that’s pure conjecture on my part. I don’t mean to lump him in with Nokia-at-large, but if I had to describe the company in just a few words, the phrase “receptive to change” wouldn’t come to mind. And if Green has personal matters to attend to, I surely wish him luck and strength. But for all of the bad coming from this situation, there’s good too because Nokia does need to change drastically and if it makes it through the current but risky transition and regains its wheels, it could be back on the road to success.
Finishing up the car analogy, Nokia’s smartphone situation reminds me of the Dodge Challenger. In the 1970s muscle car days, it was a popular model, but over time, lost its luster and was cancelled in 1983. Dodge later revived the Challenger in 2008 with a current design that included many throwback features to blend the best of the old with that of the new.
Windows Phone 7 is Nokia’s “Challenger”: The company has always made great hardware, and although not perfect, Microsoft gives Nokia some modern smartphone software for a future with potential.