Microsoft last week announced Windows Phone 8 and, in one fell swoop, succeeding in making Nokia’s existing device portfolio look out-of-date. No upgrades will be available for the Finnish vendor’s current Lumia range, and for any customer currently looking at buying a device – as well as operators deciding which handsets to add to their portfolios – this may well be an important factor.
Indeed, The Unwired reported T-Mobile Germany is not planning to offer Nokia’s current flagship Lumia 900 because it will not be upgradable to the new platform – potentially sparking complaints from customers on long-term contracts. And while Nokia may be front of the queue when it comes to getting access to Windows Phone 8, its current range has now been identified as legacy.
There was something of a sop to existing Windows Phone device owners, in that a release tagged Windows Phone 7.8 will be made available, but this looks like a largely cosmetic upgrade designed to appease.
Nokia has already gone on record as saying that momentum for its Windows Phone devices has not grown at the pace it would have liked – the word used in the company’s Q1 2012 results conference call was “mixed,” with weakness in some former strongholds such as the UK. Coupled with the rapid decline of its legacy Symbian OS business, Nokia has seen its smartphone unit suffering significantly.
The availability of platform upgrades is something of a moot point. Apple has made much of the fact that a massive chunk of its user base are using its latest platform, removing fragmentation. But this vendor also has a very limited device portfolio when compared to its rivals, as well as complete control of the software and hardware it delivers, making platform management a much easier proposition.
And while Android has been criticised for the pace at which vendors offer updates – if at all – this has not stopped smartphones running the Google OS from selling like hotcakes. Indeed, despite availability of Android 4.0 (Ice Cream Sandwich), there is still a solid market for Android 2.3, and by targeting this platform developers can also address the market of customers with newer devices.
Ultimately, the Windows Phone 7.5 devices already in the market will not stop working, and Microsoft has done a reasonable job in recent months of bolstering the app catalogue for the platform. But for anyone looking to buy a new handset, there is a case of caveat emptor.
The fact is that Nokia’s current smartphone line is old news, with something bigger, and better, around the corner. The best it can hope for is pressure on its prices, as its current devices work their way through the supply chain. The worst is a drop-off of already unimpressive sales, as customers move to rivals such as Samsung.
The irony is that Nokia has been here already. By announcing Windows Phone as its smartphone platform of choice in February 2012, the company effectively hastened the demise of Symbian OS when it did not have any devices ready to replace them. And operators and retailers who had bought into the Symbian platform were left with warehouses of old devices, coupled with reduced customer demand.
By ceding control of its platform destiny, it is very much at the hands of the timing of Microsoft with regards to its new releases – or, more importantly in this case, the point at which future releases are announced, but not consumer-ready. While it may have been on a “burning platform” before, its choice of Windows Phone seems to be similarly incendiary at the hands of Microsoft.
At the point when the company really needs to build momentum in its smartphone business, Nokia is now facing another hurdle to overcome. And the once great Finnish company does not have time on its side.
The editorial views expressed in this article are solely those of the author(s) and will not necessarily reflect the views of the GSMA, its Members or Associate Members