NOKIA 2.0: Classic Mobile Phone Makes a comeback
In the year 1865, Fredrik Idestam built a paper manufacturing mill in Southern Finland and followed it up by launching a second mill in the nearby town of Nokia in 1868. Three years later Idestam transformed his company into a share company and the Nokia company was formed.
Nokia kept growing through the 19th century and it was only in the 1960s the company branched out into electronics. In the next two years, it developed a host of electronic devices including radio telephones for the army. In 1979 Nokia took its first steps into telephony by creating Mobira in a JV with Finnish TV maker Salora, and they created the Nordic Mobile Telephone (NMT) service. This was the world’s first international cellular network and in the 80s, Nokia launched its first car phone called the Mobira Senator.
Five years later Nokia launched the Mobira Cityman, the first mobile phone that would run on the company’s NMT network. At 800 grams and priced at $6,308, it may be heavy and pricey by today’s standards, but the device soon hit cult status when Mikhail Gorbachev was photographed using the device.
The 90s were the glory years for the Finnish company. In 1994, Nokia launched 2100 with the now iconic Nokia ringtone. Three years later it launched Snake, one of the most widely recognised mobile games of all time. In 1997, Nokia also launched the Communicator, which 11 years before the first iPhone was considered to be much ahead of its time. The device not only looked cool but also offered features like email, fax, calendar and a massive display.
The same year, Nokia also launched the 6110 and the 5110 two more devices, which were way ahead of their time and competition. These devices offered a much sleeker way of text messaging, a beautiful menu system customization options like multiple colour snap-on covers. These devices were followed by the 7110, which offered basic web functions, the 7650, with a built-in camera and the 6650, the company’s first 3G enabled smartphone.
By 1998, Nokia had firmly established itself as the global leader. Where its rivals like Apple, Sony and Siemens had failed to predict the global demand, Nokia sailed through these years with a turnover that increased 500 percent from $ 8.9 billion to $42.8 billion.
After the glorious 90s, in 2007 things began to go downhill — and rapidly. In the year 2009, Nokia posted its first quarterly loss in more than a decade. This was largely due to HTC developing a smartphone running on the yet new Google Android operating system. With the iPhones and various Android smartphones taking the market by storm, Nokia failed to keep up with them. Instead of joining the horde of Android adopters, Nokia’s new CEO Stephen Elop joined hands with Microsoft to develop smartphones running on the Windows Phone platform.
The Microsoft Acquisition
Microsoft's acquisition of Nokia’s smartphone business brought an end to an era, which has seen plenty of ups and an equal number of downs. On September 3, 2013, Nokia announced that its hardware department would be acquired by Microsoft in a deal that was worth $7.2 billion. After eight months, the deal was completed.
Nokia (NOKIA.HE), once the world's biggest maker of mobile phones, was wrong-footed by the rise of smartphones and eclipsed by Apple and Samsung. It sold its entire handset business to Microsoft Corp (MSFT.O) in 2014 and focused on telecoms network equipment. Microsoft has struggled with phones after the 2014 deal with Nokia, and it decided to write off $7.5 billion from the business.
Nokia, however, held on to its phone patents with a view to eventually striking a licensing deal, though it had to wait due to a non-compete deal with Microsoft.
Recently, HMD a company backed by one of its former executives teamed up with manufacturer Foxconn (2354.TW) to buy the rights to the brand for mobile devices. Microsoft also decided to sell its entry-level phones business to HMD and Foxconn subsidiary FIH Mobile for $350 million. Nokia, whose global market share in handsets peaked at around 40 percent in 2008, believed that its brand remained widely recognised, especially in developing markets. Nokia also believed that its brand was strong in the feature phone space.
The company now making Nokia phones (HMD) for their first act, they’ve set about restoring the 3310 to its former glory, while bringing the beloved old phone into the new era. The opportunity in the emerging markets may be the inspiration behind the rebirth of Nokia in the mobile phone space. The resurrection of the 3310 Nokia phone may just be what is needed for the revival of the brand, especially in emerging markets. After its launch in 2000, Nokia sold more than 125 million models of its indestructible candy bar, turning Snake into a cultural icon and hearing that tinkling ringtone permanently into the back of your mind. If you didn’t own one, you probably knew someone who did. It’s been almost 17 years since the 3310 first came out. In that time the Nokia brand has been bought, sold, and stripped for parts. At one point the 3310 even made a comeback, in the form of a wonky Windows Phone device with a huge camera bump that didn’t exactly excite the buying public.
At the Mobile World Congress in Barcelona, the company re-launched the phone. The new Nokia 3310 takes the iconic silhouette of the original and reimagines it for 2017. It comes with a long-lasting battery, so you can talk all day, or leave the phone on standby for up to a month. This is ideal for some countries in Africa where electricity is not always available and where the internet is not widely adopted. 3310 is just one of the phones produced by the company. There’s more in the Nokia stable and others are yet to come.