Nokia’s Failure

After leading the mobile industry for more than a decade, Nokia’s sales decreased. It was the
outcome of both internal decisions and the external environment.

Change in The Top Management: In 2006, Olli-Pekka Kallasvuo took over the position of CEO
replacing Jorma Ollila. Nokia smartphones and basic phone operations were integrated under the
new administration, which placed a greater emphasis on traditional phones rather than
experimenting with new technology.

The Arrival of New Companies: In 2007, Apple stepped into the smartphone industry and launched
the iconic iPhone. Nokia went into denial and refused to take Apple as a threat to their high sales
numbers. It also considered Apple phones to be inferior since they use 2G technology, whereas
Nokia's phones use 3G technology.

Google released the Android operating system (OS) in 2008. By this time, Apple’s iOS was growing in
popularity, and its sales were steadily increasing. Nokia should have switched to Android to tackle
the threat, but it didn't and continued to build phones using the old Symbian OS.

Delay in New Phone Release: In 2010, Nokia announced the N97, which would be the first phone to
run Symbian 3. However, because the release was delayed, it was unable to compete with Apple and
the emerging Google.
In 2010, Olli-Pekka Kallasvuo was discharged from the position of CEO, and Stephen Elop, from
Microsoft, took his place.

Partnership with Microsoft: In 2011, to cope with the dwindling market share Nokia partnered with
Microsoft to make Windows phone, abandoning old OSs like Symbian and MeeGo.

The Windows Phone failed to make an effect on an already crowded smartphone market in 2012.
The main reason for this was the Windows Store's lack of programmes compared to Google's
Playstore and Apple's store.

Nokia, which had held about 40% of the market, now holds less than 5% of the total market. The
company's management, stockholders, and customers were all worried about Nokia's impending
bankruptcy.

Acquisition By Microsoft: In 2014, Nokia was near to being bankrupt. It wasn't until Microsoft
intervened that Nokia was purchased by Microsoft for $ 7.2 billion.