Nokia's Biggest Competition: Android In The Developing World

Nokia is in trouble, and it's well known: While the firm is still making money, its future plans were cast into deep shadow by the rapidly evolving smartphone scene, led by the iPhone and its OS, which more or less made Nokia's current smartphones (as well as future generations) obsolete overnight. The firm is trying to pull off a dramatic pivot, with Stephen Elop at the helm, and has just revealed the first Windows Phone 7 devices with which it hopes to save its future.

Simultaneously Nokia's also launched a big offensive to win over the "next billion," consumers in the developing world who are increasingly turning to the net and new technology to improve their lifestyles and national wellbeing. 

But where the iPhone marched in, Google's Android has swept in its wake. And now it's Google's tech which may be the biggest threat to Nokia's success, including in developing nations.

The flagship phone from Nokia is now the Lumia 800, previously known as codename Searay. It's a dramatic re-working of Nokia's N9 phone, its recently pseudo-cancelled MeeGo-powered device that represented Nokia's first real stab at a new-style all-touchscreen smartphone in the post-iPhone world, and one that met with much industry enthusiasm.

In many ways the 800's a breakthrough for Nokia: It has a clever scratch-resistant polycarbonate body that stands out among its plastic and metal peers, it has an aggressive design with a prominent glass face, bright OLED display and sleek external form. Inside it sports Windows Phone 7, and it worked very closely with Microsoft to ensure that there was a good OS synergy with its 1.4 GHz processor and other hardware--a very Apple-esque maneuver. Nokia Music built-in is a clever touch that'll make it a good rival to iTunes and also Google's expected music push, and with Nokia Drive it also has excellent built-in navigation.

Some are criticizing its launch in Europe first, but this ignores the fact that the European smartphone market is likely bigger than the U.S.'s, and betrays an America-centric stance that even Apple has moved past (launching the iPhone 4S in 7 nations internationally, with 22 more inside a month).

The biggest issue for the device may be its price. Equivalent to $580, it's right up there with the iPhone 4S and a number of high-profile Android units. Still, alongside the 800 is the interesting Lumia 710, a very similar phone internally but with reduced specs on its design, construction and screen tech and a lower $374 equivalent price. This is a much more affordable phone, which will probably cost significantly less with carrier subsidies.

The 800 carries itself as a radically-designed, high-end smartphone sporting the Windows OS that's earned much praise for its non-iPhone-like innovation. It almost justifies its own price tag, especially among the (smaller slice of) members of the public that fancy a Windows device over others.

But even at the high end, the 800 is going to find it difficult to make a dent, especially if very similar windows phones from Samsung and other big-name Windows partners are compared to it...and remembering that sales of the existing Windows hardware haven't been stellar compared to Apple's and, for example, Samsung's sales. And the 710, while more affordable, is likely to get lost amid the hundreds of similarly-specced Android phones available from a slew of makers, many of which will cost the same price or less, and some also offering better specs...all with the Android ecosystem the public is familiar with, and hundreds of thousands of apps. 

Then we come to Nokia's plan to capture growing markets in the developing world. The Asha range costs between €60 and €115 ($83 to $160) and is much more conventional. The handsets have mainly all-QWERTY keyboards, good cameras, built-in navigation and 3G data connectivity. Some have dual SIMs, very useful for separating business and personal use on the same handset (or in regions where carrier tariffs work best for different use-cases).

But these phones have the S40 OS inside. So, it's tempting to call them very high-end feature phones rather than smartphones. They may have touchscreens and support app downloads from the Nokia store, as well has having some games and social networking built-in, but they don't necessarily compete alongside many existing Android products.

Then there's the iPhone 3GS to think about--a phone that Apple's now made available for free on contract in many places, and which is aimed squarely at the low-mid end pre-pay market in many nations where pre-pay is more prevalent than the U.S.'s on-contract model.

In terms of sheer competition from cheaper Android handsets from HTC, Samsung, LG, ZTE and Huawei, and an expected Android-sweep of the developing world, Nokia's efforts to connect the "Next Billion" seem like a desperate shotgun effort--with multiple combinations of tech components and style jumbled together to produce a price-differentiated lineup...but lacking one single crowd-pleasing innovation to make them stand out. Even Square's Jack Dorsey thinks this is the case, tweeting "Nokia: you make too many products. Focus on 3." 

Nokia hasn't even included NFC in these devices. We know that in nations like Africa, alternative mobile payment systems are already paving the way, as it were, for more advanced NFC protocols (because in many developing nations, handsets are becoming a convenient way to pay for goods via carrier billing...because many people lack bank accounts). Google Wallet and NFC support are only going to expand internationally and onto even the cheaper range of smartphones--and Google's already demonstrated that it can bend Wallet to work with pre-paid Google "credit cards." And Android phones natively support systems like Gmail, which carry a cachet that Nokia's own mail system can't match.

New phones represent Nokia's great hope. But they're presented against a background of widespread Android market domination, and even expansion...and at a time that Apple, too, is trying to appeal to entry-level smartphone users, and some developing world markets.

Nokia's problem is that it has to innovate faster than it ever has before, and critics may say the phones don't match up to the ambition. It's as if Nokia, which became a supertanker sailing serenely on the cell phone sea after years of dominance, is desperately trying to turn its hulk to avoid a crash. And though its captain is desperately trying new tricks to turn the bulky ship, it's not clear if the tricks are really clever enough.

 

Chat about this news with Kit Eaton on Twitter and Fast Company too.

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1 Comments

  • Chris Lee

    Nokia is on the move. They just bought a division of Motorola. Time will tell if a good move.

    Chris
    Owner Cel Financial Services
    Registered Bonded California CTEC Tax Preparer
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