Nokia’s ‘iPhone killer’ a 2009 event
By Scott Moritz
With touchscreen phones all the rage, and U.S. telcos following AT&T’s (T) lead of cutting the price of Apple’s (AAPL) iPhone, it would seem Nokia (NOK) will be left out of the smartphone party this year.
The Finnish phone giant won’t have its closely-watched 5800 phone – Nokia’s music-loaded take on the iPhone – available here until sometime in the first half of next year, according to people familiar with the phone. Nokia wasn’t immediately available for comment.
And even when it arrives, Nokia has lacked a big U.S. phone partner that would provide the subsidy necessary to put it under the $200 range. At full price, it will have a hard time making a big splash.
“You could look at it as having a 100% upside,” says Nielson IAG analyst Roger Entner, referring to Nokia’s measly share of the U.S. market. Make that a potential upside of 95.5% since Nokia’s slice of the U.S. market has now fallen a percentage point from year-ago levels to 4.5%.
These numbers were part of Nokia’s overall solid third-quarter performance reported Thursday. Nokia posted an adjusted profit of 44 cents a share, down from the 55 cents it netted last year, but in line with analysts estimates. Sales fell 5% to $16.4 billion from $17.3 billion in the year-ago quarter and below the $17.2 billion street estimate.
After hitting a new four-year low, Nokia shares rebounded a bit Thursday up 4% as investors took some confidence from the fact that it met estimates.
As Nokia predicted, its worldwide market share fell to 38% in the third quarter from 40% in the prior period. The decline, according to Nokia, reflects the company’s unwillingness to cut phone prices amid a heated price war in some regions.
Nokia has managed to grab and hold onto the No.1 phone supplier position by honing its skills at making low- and medium-priced phones for a global audience. This focus on the mainstream has caused Nokia to be consistently late to fashion trends like flip phones, ultrathin designs and now touchscreens.
After a strong start in the smartphone wars with over half the global market in 2007, Nokia has dropped to a 35% slice in the third quarter from 48% of the market in the second quarter, according to Morgan Stanley analyst Jim Dawson. The alarming sequential drop is a reflection of how strong rivals like Apple and Research in Motion (RIMM) have grown. The smartphone market will get a new challenger later this month with the arrival of Google’s (GOOG) Android-powered G1 phone at T-Mobile.
But while 2008 is not going to be a big year here for Nokia, the trends – aside from the slumping global economy – are promising overall.
Each player comes from with a different specialty to the smartphone market, says Entner. Apple and Google aim for a strong Internet experience and RIM’s BlackBerry Storm hopes to capitalizes on its successful e-mail background with a touchscreen design. “Nokia comes from a mobile phone approach,” says Entner.
“Nokia sees the phone as an integrated device.” says Entner. In the past three years, Nokia has acquired mobile e-mail shop Intellisync, GPS mapper Navteq and digital media delivery system Loudeye in an effort to control the delivery of services like e-mail, navigation, photography, music, videos, games and the Internet.
Of course, all this will matter more in the U.S. when Nokia can deliver the device.
I saw nothing that made me want to kill off my iPhone just yet. There are so many features the iPhone excels at, that I don’t mind waiting for Apple to perfect the missing functions before releasing them.
As a multi-media artist, iPhone has proven to be the perfect cutting edge device for showcasing my art & animation portfolio.
Give up the smooth ease of web browsing, amazing iPod, and 6,000 killer Apps for “Cut/Past and vid/cam” ???
Mnnnn…. I don’t think so.
Nokia?
I will never buy their phones! Why?
After good years in 90′es they concentrate on making really untested phones, which are full of bugs.
Now, they treat customers as stupid children. Bugs are aften called “feature”… In example in Smartphone 9300 sending emails used to stop when new SMS was received…
Morevier, They have the worst support, I have ever met!
Too many bugs and really awful unstable Symbian!
BTW: I have never supposed Symbian would be the worst OS… muche worse than MS NT4…
Good bye NOKIA with Symbian!
WM6 is much better solution and why not to use iPhone?
If you have notebook with Mac OS X 10.5 it will be really good choise.
I am using 3 phones:
- Nokia 6021 – only for business calls – it is nothing special but it has: small size, perfect battery and… no Symbian;
- ETEN m700 (WM6 -> hardware keyboard really good for sending many SMSs in Polish, Russian and Greek languags. Moreover, I like to have real delivery report + stable GPS navigation… and Skype!
- iPhone – VPN which really works! It is a good solution for accessing web pages, Contacts & Calendar, and music syncing with my MB Pro.
There is no doubt that nokia has best phones in terms of quality of reception, easy to use software. I don’t know why US don’t appreciate nokia phones. But in developing countires its a big hit……..
Hmmm, judging by the huge number of comments praising the IPhone and predicting that IPhone is not dying, I can only imagine that many of the readers/commenters own Apple stock 
They are panicking that the stock will tank if people dump IPhones and switch to Nokia. Well, -if only they knew what I know about the new Nokia they would ….
Will this phone be an iPhone killer? Not likely. It will have some features that work better or are better designed than apple’s, but overall the iPhone is just too well put together and designed to be swept under by anything else on the market right now.
One advantage that Apple has over any other manufacturer is that they HAVEN’T been making phones for years. This fresh outlook gives them the ability to think out of the box (I hate that phrase).
IMHO, it will be at least a year or more before we really have a phone that is as well received and sells as well as the iPhone. It will hopefully be Android powered, as the open-source facet will lead to a much wider variety of programs for it.
A side note, I have noticed that the iPhone is rather polarizing. What I mean is that among current and previous owners, most people love it. But a few hate it. Not much in the middle. Yes, the iPhone has issues. It has limitations. And those aspects are what will give designers and programmers the edge in developing a phone to compete.
About the Android G1: yes, it looks like it fell out of the back of my dog. But it is only the first generation. Let a year go by, and we might have something.
Another iPhone killer?
Who made up that saying and why has every single cell phone that has come after the iPhone been called “The next iPhone killer?”
The only other phrase that could come close to being over used as much is the phrase, “The next iPod killer” which too hasn’t been killed yet, but apparently every mp3 player to come out since the iPod is the next iPod killer.
They can’t ALL be iPhone/iPod killers. The phrase is kind of catchy, but give it a rest already.
Unless Nokia has something equivalent to Apple’s App Store they will not have anything close to an “iPhone Killer”. Custom applications and great user interfaces are what make the iPhone great. Google has a chance only if they create a user interface that isn’t hard to use and they do not have a great track record in that area.
{{{{Apple “iPod Nano” phone is due to come out sometimes next year. This phone is free with contracts (and this phone should be available to all carriers). Kids and teens are going love it!
We’re talking an additional 20M Apple phones sold each year!
Too bad for Nokia …}}}
Shows in a weak economy there are plenty of people with hundreds or even thousands to spend every year on mobile phones. Many people I knew even paid the ETF to migrate to AT&T even though it can be unlocked using a $40 turbo sim card
{{{I dont understand why any serious mobile user may use iPhone at all. There are so many restrictions..that you can not install this and you can not install that. What is this? If you want to put so many of restrictions why do you sell it in the market. Rather use it yourself.
Agreed it has the best touch feature, BUT thats the end of of it. Nothing else is worth talking about. It certainly looses out of many necessary features.
I just sold of and will never buy iPhone again}}
Its called jailbreaking and why if you list a 3G Unlocked 16GB iphone on craigslist, you can have 10 bids within a few hours. The 3G can be unlocked using a $40 turbo sim card.
Carriers like Tmobile should introduce some phones that aren’t completely ugly or years behind in technology.
This is not an Iphone killer not even close. The previous what was supposed to be iphone killer the G1 Google Android may turn out to be the biggest flop of the year since it looks like a cheap plastic sidekick. Others like the Dare & Voyager have not lived up to the hype either
One thing about Iphones is that they retain at least 100% of their retail value and one can even make a good profit. On Craigslist, a 16GB 3G can easily sell for $700 within hours of listing, and the earlier generation 8GB with NO 3G can easily sell for $550.
What Nokia lacks is focus, They have allowed the good things about their smartphones to be comingled with the cheap things that they make for the giant telecom retailers. I base this on the fact that the smartphone like the N95 and N80 series are clearly far less superior in capability than the IPHONE or the New Palm phones. Nokia’s Market share will continue to drop because they have adopted a Sony Playsatation strategy that is flawed and based on mere notion that competition is good.
Consumers have more choice than ever before and the competitors phones are better. The software the runs the high end phones of Nokia limits its capabilities and will never make their smartphone brands anymore than just an expensive phone.
In 2000 they started with the Nokia 3650 well ahead of its time and now the N95 which has far less capability than the Iphone or even the Iphone Touch.
Blah-blah-blah Apple Rules Macs Just Work iPhone’s cool Blah-blah-blah
Don’t know about you, I am just sick of the worshippers, lashing at anything that can touch their cult like a fundamentalist convert to a new religion (note that people who buy a Mac are said to have “converted”). The people below attack the journalist who posted this article as if he is offensive to Apple by not demeaning Nokia enough, but if you read the article, you can see many subtle barbs at Nokia, e.g., that it is only for 2009 (US-centric rubbish as Europe will have it this year).
You should read an article about Zune v iPod on All-things-D, I think, where the writer did not miss a chance to poke and offend the Zune (and all other MP3s) in a sense trying to persuade that nobody competes with Apple. The narrative of the media is that “Apple good, user friendly, cool, elegant and reliable” while everything else (if it competes with Apple products in any way, even in the future) is “clunky, prone to crashes, and nerdy”.
You don’t know why it is an iphone killer.The thing is this phone will come with unlimited free songs.Got it?Now stop arguing and think.You will pay lets say 400$ and have music in your nokia and as long as you have the phone it is free to you to listen.Thats why!
I have seen this phone and tested it a little bit. Video quality is very good. Music quality is excellent. You can use the stylus that comes with the phone which means you can touch smaller areas compared to iPhone. Doesn’t have the multi-touch. It feels more like a traditional phone with a touch feature not like an iPhone. Comes with music will drown Apple’s sales.
Why do supposed serious journalists continue to use idiotic terms like “iPhone killer”?
All that term means is that the company that is producing the new handset has already admitted defeat and that Apple’s iPhone is the product they need to live up to. None of the 15 or 20 supposed “iPhone killers” produced so far have killed anything let alone any iPhone sales. C’mon Moritz can’t you be a little original and think of something more applicable to say?
You are right Ankit, and nokia´s leadership also extends to the rest of the world, mainly due to the fact that nokia phones have the same navigation menus ever since cellphones existed. They definitely took their time designing them (even the plugs to charge the batteries work on most old and new models). I live in Paraguay (South America), where people often have two or three cellphones, and the market is so open that we receive new models from Asia permanently. The Iphone has definitely conquered some space in the local market but there is simply no way to beat a nokia in this side of the planet.
I dont understand why any serious mobile user may use iPhone at all. There are so many restrictions..that you can not install this and you can not install that. What is this? If you want to put so many of restrictions why do you sell it in the market. Rather use it yourself.
Agreed it has the best touch feature, BUT thats the end of of it. Nothing else is worth talking about. It certainly looses out of many necessary features.
I just sold of and will never buy iPhone again.
Nokia may be able to challenge Apple and Rim in emerging markets like India, China and some European countries but it doesn’t have any chance in the US. However, I do feel that China and India are really big cellphone markets, where people are ready to pay a premium for the best phone, and this new phone from Nokia might just prevent Apple from making serious inroads there.
Chad, I think a better word would be “Gullible”.
P.B. “Nokia, always a step behind. iPhone killer is going to walk right into iPhone 4G or iPhone Nano. Nokia is washed-up.”
I find that laughable and so does many others. Other than providing a multi-touch screen and marketing it well, Apple’s iPhone is crap compared to phones especially made by Nokia. Nokia’s implemented real stand-alone GPS, high quality camera which takes some of the best mobile photos and videos ever seen on a cell phone. Nokia has been able to develop phones for all types of users. Nokia has implemented SIP (used for real VOIP) on their cellphones. Oh, lets all forget that because I can touch the screen of an iPhone and it “looks” so cool.
Apple “iPod Nano” phone is due to come out sometimes next year. This phone is free with contracts (and this phone should be available to all carriers). Kids and teens are going love it!
We’re talking an additional 20M Apple phones sold each year!
Too bad for Nokia …
What a joke, I have always been a huge fan of Nokia devices, but this is NOT an iPhone killer. For one, the HTC G1 (Tmobile Android) is not even an iPhone killer, how is this?
Nokia, always a step behind. iPhone killer is going to walk right into iPhone 4G or iPhone Nano. Nokia is washed-up.
My daughter brings her iphone back to store. No picture message, only the songs from itunes work, even if you own the record,and if you wanna make a song ring tone you pay third time. “made for adults. I want my Nokia back”
Soooo.. Nokia’s “iPhone killer” comes out next year? hmmmm…it better deserves to be called as “Nokia suicider”…lol
Why are these non-existent devices that are not even out yet ALWAYS referred to as ‘iPhone killer’s? THIS SHOWS YOUR PREJUDICE TOWARD APPLE AND ITS SHAREHOLDERS. YOU ARE RETARDED AND CERTAINLY NOT A PROFESSIONAL IN ANY SENSE OF THE WORD.
There is not a soul who is “loyal” to a Nokia phone. They by them for the features, so they better be great. Apple on the other hand has the most loyal customers around. iPhone killer indeed!
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dudes..really nice discussion going on here.most people love APPLE IPHONE right?
just think once no.1 mobile maker in world NOKIA just entered touchscreen market? it means it just started with basic touchscreen phone with very less price affordable by many people.
dudes…its the beginning not the end.
nokia can easily make a phone that is sure a iphone killing.if you want just check nokia conversations of next touchscreen phones…ALL iphone lovers WILL PISS OFF.
never underestimate a company manufactures many different models like nokia…its true fact….