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Nokia is a Finnish company largely known for its telecommunication technologies. However, in recent times it appears to have lost some ground to competitors, primarily in the smartphone market, such as Apple and Samsung. In this historical case study, we explore the origins of Nokia and their progress toward breaking new ground in telecommunications technology. We also look at some of the pitfalls they encountered and how perhaps things could have been done differently. In particular, we focus on the aspect of their mobile phone interface design evolution and improvements. http://ejcsit.uniten.edu.my/index.php/ejcsit/article/view/95/37
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electronic Journal of Computer Science and Information Technology (eJCSIT), Vol. 6, No. 1, 2016
B. Borhanuddin and A. Iqbal, Nokia: An Historical Case Study
1
Nokia: An Historical Case Study
Boezura Borhanuddin1, Azlan Iqbal2
1College of Graduate Studies, Universiti Tenaga Nasional, Putrajaya Campus, Selangor, Malaysia
e-mail: octavia.sativa@gmail.com
2College of Computer Science and IT, Universiti Tenaga Nasional, Putrajaya Campus, Selangor, Malaysia
e-mail: azlan@uniten.edu.my
Abstract – Nokia is a Finnish company largely known for its
telecommunication technologies. However, in recent times it
appears to have lost some ground to competitors, primarily in
the smartphone market, such as Apple and Samsung. In this
historical case study, we explore the origins of Nokia and their
progress toward breaking new ground in telecommunications
technology. We also look at some of the pitfalls they
encountered and how perhaps things could have been done
differently. In particular, we focus on the aspect of their mobile
phone interface design evolution and improvements.
Keywords – Nokia, telecommunications, history, device
interface, mobile phone
I. INTRODUCTION
The name, ‘Nokia’ actually originated from a Finnish
town called Nokia, and also the Nokianvirta river. It is a
multinational corporation first started in 1865 by Fredrik
Idestam, at first as a ground wood pulp mill. Later, with
his close friend Leo Mechelin, there was a joint venture
and he changed his small firm into a share company,
Nokia Ab. At the beginning of 20th century, Nokia had
established a rubber business after Eduard Olon’s Finnish
Rubber Works (Suomen Gummitehdas Oy). It included
also electricity generation to its business after Idestam
retired. Nokia was then expanded to cable and electronics
business when it joined Finnish Cable Works (Suomen
Kaapelitehdas Oy).
In 1967, all of the three companies (Nokia Ab, Suomen
Gummitehdas and Suomen Kaapelitehdas) which were
jointly owned since 1922, merged as a new industrial
conglomerate known as Nokia Corporation. Its first
President, Bjorn Westerlund, had been responsible to set
the organisation’s first electronics department in 1960, for
the birth of telecommunications business. To summarize,
Nokia was involved in various industries, from paper
products, to vehicle tires, rubber boots, communication
cables, plastics, aluminium, chemicals, electronics,
computers, electric generation devices, robotics,
capacitors and also military equipment [1]. Figure 1
shows Nokia’s toilet paper produced in the 1960s whereas
Figure 2 shows an example of Nokia’s capacitor. Figure 3
shows the first Nokia logo in 1865.
As Nokia started its telecommunications equipment
business in 1960, the business focused on the production
of radio-transmission equipment at Finnish Cable Works.
And as the European Union relaxed business regulations
over telecommunication industries, Nokia further stepped
up to new challenges in mobile telecommunication
devices as competition and demands increased [1].
Figure 1. Nokia Toilet Paper [2].
Figure 2. Nokia Capacitor [3].
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B. Borhanuddin and A. Iqbal, Nokia: An Historical Case Study
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Figure 3. Nokia 1865 Logo [4].
II. NOKIAS IMPACT ON THE WORLDWIDE
TELECOMMUNICATIONS INDUSTRY
In the 1970s, Nokia got more involved in producing
telecommunications devices such as network equipment
and digital switches for the telephone exchange. Later in
1982, Nokia claimed that they produced the first fully
digital local telephone in Europe and first car phone for
Nordic Mobile Telephone (NMT) with a network standard
of 1G. The Finnish state sold its company called
Telefenno (which was previously owned by Nokia
network equipment production) and shares to Nokia, and
in 1992, its name changed to Nokia Telecommunications.
One of Nokia’s breakthroughs in telecommunication
technologies was the development of a Global System for
Mobile Communications (GSM 2G), the second
generation for network standards that can transfer both
voice traffic and data.
With GSM technology, Nokia had launched many types
of mobile phones, both prototype and complete products
worldwide. GSM supports for text messaging service
(Short Message Service or SMS) and high quality voice
calls made it dominant in the mobile telecommunication
industry in the 1990s. Nokia was the world’s largest
mobile phone manufacturer until 2012. In 2007, Nokia
combined with Siemens Network to lead the global
telecommunications infrastructure to focus on mobile
broadband technology and services.
Nokia also joined with Microsoft to enhance its position
in the smartphone market to rival iOS and Android in
2011, by adopting the Windows Phone operating system.
Currently, Nokia and Alcatel-Lucent together combined to
create the next generation technologies and services for an
IP connected world (April 2015) and is expected to close
the transaction in early 2016.
III. NOKIA MOBILE PHONE HISTORY AND CHANGES IN
INTERFACE DESIGN
The Mobira Senator, introduced in 1982, was considered
perhaps the first true mobile phone in box form, weighing
9.8 kilograms. The antenna protrudes conspicuously and
the whole body consists of covered electronic parts and
battery cells with a handle to let users carry it around. Its
top part is where the number pad and other function
buttons are operated without any display screen. At first
glance, it may look like a digital household telephone
connected on top of a modern-day dry car battery cell.
The hook (where the microphone and speaker components
are located) is similar to the household telephone design
at that time without any buttons to operate. Unfortunately,
there is lack of available information about its interface
descriptions. Figure 4 shows the Nokia Mobira Senator
model.
In 1984, the Nokia Mobira Talkman was made as
portable car phone since it could be recharged from the
car’s cigarette lighter socket. It weighed about 4.7
kilograms and could store 184 contact numbers. The idea
of having dial buttons and a mono-coloured display on the
hook where the microphone and speaker are located is that
it would be easier for users to see which buttons are being
dialled. Additionally, the keypad facing opposite from
user’s face also had the added advantage for comfort (no
rubbery effect from keypad buttons) when talking.
The battery could last about 10 hours on standby and 60
minutes for talk time. Since its weight is half of its
predecessors, it was considered more portable since it can
be used and recharged while on a vehicle anywhere at that
time. Figure 5 shows the Nokia Talkman NMT450 model
and Figure 6 as it was used in the 1987 motion picture,
Lethal Weapon.
Figure 4. Nokia Mobira Senator 1982 Mobile Phone [5].
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Figure 5. Nokia Mobira Talkman NMT450 [6].
Nokia Mobira Cityman brick-form mobile phones starting
in 1987 until early 1990s were considered one of the first
‘compact’ mobile phones ever made. It was released for
the NMT network service, weighing about 760 grams
(almost just a quarter of Talkman’s) with dimensions of
183mm x 43mm x 79mm, reduced significantly from
previous models since it used 1000mAh Nickel-Cadmium
(NiCD) battery technology. Talk time is however reduced
to 50 minutes and only 14 hours standby time, while
having to charge for about 4 hours.
It has a hands-free design (no more attached wire like
previous models) and has both table and car charger
accessories, adding more to the portability factor. As
shown on Figure 8, the functions are straightforward such
as; lock and release phone lock, last dialled number, talk
time duration, keyboard and display lighting control,
display own number, signal strength and battery indicator.
Some functions are also displayed for quick and easy
access to them such; CLR (clear), END, SND (send), SEL
(select), PWR (power) and VOL (volume). Other
functions are also combine with numbering keypad such
as STO (store) on star, LCK (lock/unlock) on 0 digit, and
RCL (recall) on hash.
Figure 6. Nokia Talkman in Lethal Weapon [7].
Figure 7 shows the front and side views. Also notice that
the texture on left and right side of the phone enhance
handgrip friction to the phone while talking or holding.
The brick size phone still was not comfortable when using
since the gripping felt unnatural (not ergonomic due to its
depth) especially for small-sized hands, compared to the
Talkman’s hook design.
Figure 7. Front and Side Views of the Cityman [8]
Still, the portability concept significantly improved as
battery technology changed to NiCD and the introduction
of charging dock that use the PWR60N standard (input
220V, output 18V). The size of keypad seems comfortable
and straightforward enough to use the buttons without
confusion compared to modern-day compact designs,
except touch-screens, which depends a lot on the user.
The 1990s version of the Nokia Cityman PT version is
also in brick form but the size is smaller and more features
are included. The dimensions are similar 180 mm x 55
mm x 40 mm, and weighing 500 grams; the monochrome
display and can store up to 40 contacts. Figure 8 shows
the significant change on how the dimensions on the hand
grip area changed for better portability. Notice that the
main functions (select, recall, power, send, clear and end)
are located on top part of keypad with different coloured
buttons for quick identification.
Number buttons are now included with alphabets to
type the names for contacts. This version also has the
ability to automatically redial for speed dialling. Figure 9
shows the isometric view of the PT version and also the
smaller size of the NiCD battery after been detached from
its back (the charging port was missing). In 1992, Nokia
Analogue 101 was introduced in the form of a ‘candy
bar’, and considered the best-selling phone of the early
1990s. Nokia research showed that even though people
wanted smaller phones, they also wanted it to be as easy
to use as bigger phones of the time.
Frank Nuovo became Nokia’s chief designer in large
part due to his idea to highlight the ergonomic aspect of
mobile phone design. He mentioned that the keypad
layout should be well-spaced, and placed in a way for
easy and natural use. Other competitors at the time tried to
over-crowd the keypad with too many functions and
complicated designs. Nokia 101 introduced the green and
red-coloured keys for answer and reject functions. It also
had a backlit keypad for use in the dark. The distance
between the mouth and earpieces is also considered
improved (since it is smaller) and had a comfortable
distance.
Another interesting feature is its intuitive and easy to
learn menu system [10]. Later in 1994, Nokia released the
almost similar interface and sized model 1011 for the
GSM digital handset. It had a retractable antenna/aerial in
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the analogue version. The main difference between the
two models is the diamond-shaped earpiece [11].
Weighing about 300 grams, the dimensions are; 168 mm x
60 mm x 20 mm. The hash and star buttons were not
included with specific function indications. The screen
size and large font size were considered readable with
both battery and signal strength indicators. New cursor
keys (up and down) are designed in such as way that user
can easily browse and choose options. The menu button
was now storing all the functions, unlike the previous
approach that exposed some frequently used functions on
numbered keypads.
Figure 8. Nokia Citiman PT612 Keypad [9].
Figure 9. Nokia Citiman PT612 and Battery [9].
Figure 10. Nokia Citiman PT612 Back View.
Figure 11. Underneath the Nokia Citiman PT612.
The power button (on/off) was also introduced with a new
red-coloured symbol (easily recognizable when first
encountered), and no longer indicated by a ‘PWR’
labelled button. The new location for both call and reject
buttons on the middle area of keypad suggested that both
are the most important main functions on the phone and
easily identified. Overall, the minimalist keypad layout
design is considered user-friendly, easy to learn and
understand.
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Figure 12. Nokia 101 Analogue Phone [12].
Figure 13. Nokia 1011 GSM Model [13].
The Nokia 2110 series was also famous in 1994, including
the first Nokia ring tune ever introduced in their mobile
phone products. The second generation of the GSM phone
was considered a best-selling business phone from 1994
to 1997 due to its light weight (236 grams), small size (56
mm x 148 mm x 25 mm depth). The interface design was
significantly changed from the previous model. Due to its
small size, the navigation and ‘select’ keys are grouped
together within the display screen in an oval shape,
separating the call/reject keys just below it. Such a layout
indicates that users will first access the menu or memory
functions in order to recall numbers, send messages or
choose other functions.
It is reasonable that the navigation and select keys are
located close to the display for easy browsing and
reference. In Figure 14, notice that the power button is
also relocated to another location (upper side just below
the antenna, almost embedded) to separate it from the
keypad area for better visibility and to minimize
accidental actions during travel or talking. The antenna is
retractable and similar to previous version.
Figure 14. Nokia 2110 [14].
Referring to Figure 15, the Nokia 6110 was the next
generation of the same model 2110, in which both
interface layouts are almost similar, except that 6110 does
not have both a cancel and alphabet toggle button, and it
also is significantly reduced in size and weight. Not long
after the Nokia 2110 series received positive feedback
from customers, the revolutionary curved design Nokia
8110 Banana phone was released (1996) as one of the first
‘slider’ phones ever innovated; a slimmer design and fits
in most pockets.
The curved design has the advantage of fitting the
natural form of the user’s face and had better voice quality
with a microphone that was located nearer to the mouth.
The interface design of the keypad and display was still
similar to its predecessor. Figure 16 shows the 8110
model as it was used in the 1999, ‘The Matrix’ movie, and
Figure 17 shows its sliding ability. To receive call from
others, one just needs to open the slider, and to end the
call, to close it. The slider can also be adjusted to suit the
position of the mouth [16].
One of the most popular and successful phones in
history was the Nokia 3210 GSM phone released in 1999.
It had a weight of 153 grams, with dimensions of 123.8
mm x 50.5 mm x 16.7-22.5 mm. It was also considered
the first mass market phone to accommodate lower and
middle class users in the European region.
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Figure 15. Comparison between the Nokia 2110 and 6110 [15].
Figure 16. As seen in the 1999 The Matrix movie [17].
Figure 17. The slider can be adjusted [18].
Designed by Alastair Curtis in Nokia’s Los Angeles
Design Centre, its famous features are the absence of an
antenna and customizable fascias (clip-on) [19]. Its casing
construction may be the reason for high durability
compared to other manufactured phones. It had slightly
curved sides to follow the shape of the palm, allowing the
fingers and thumb to easily manipulate the buttons.
Ben Stiller as Derek Zoolander parodying the small phone craze at the
turn of the millennium.1
Figure 18. The Nokia 3210 [20].
The power button is on top of the phone with main blue
button in the middle to choose options. The ‘C’ (cancel)
button is also an undo action, together with navigation
buttons (up and down) located on the ‘horse-shoe’ shaped
display frame. The ergonomic simplicity of the keypad
layout design of the Nokia 3110-3310 series should be a
good example of blending ‘art-and-science’ in designing
and developing complex devices. Its successors (Figure
20), the Nokia 1100 series was also the world’s best
selling handphone since about 2003. It was targeted
toward developing countries and users who do not need
advanced features other than making calls, saving
contacts, sending messages, alarm clock and a few others.
The keypad and front face were designed to be as
dustproof as possible, together with non-slip material for
1 “Derek Zoolander Ditched His Tiny Flip Phone for a Giant Samsung”;
http://www.theverge.com/2015/11/10/9708870/zooland er-2-samsung-
selfie-smartphone-product-placement.
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humid weather. All buttons are available on the keypad,
including the power button [22].
Figure 19. Curved sides of the Nokia 3310 [21].
Figure 20. The Nokia 1100 [22].
In 2002, Nokia released the first European phone with a
built-in camera, weighing 154 grams with sliding ability
between the keypad and display screen. The dimensions
were 56 mm x 114 mm x 26 mm. It was also known as the
first phone to use the Symbian OS, with a colour display
embedded with general packet radio service (GPRS),
multimedia messaging service (MMS), infrared and
Bluetooth connectivity. The Nokia 7650 (Figures 21-23)
can be considered a smartphone since it had an operating
system that offered messaging, internet access, image
management, calendar, to-do lists and other advanced
features.
To access the 640x480 pixel camera, one simply slid
open the keypad. Most of the menu browsing and
selecting items can be accessed via the joystick [23]. With
the joystick, the user can choose all four directions (up,
down, left, and right) and select objects or functions on
the screen. However, gripping may be an issue during
single-handed operation since the thumb has to be in a
lower position compared with the other four fingers.
Figure 21. Holding the Nokia 7650 [24].
Figure 22. The Nokia 7650 against a matchstick [25].
The clamshell Nokia 613-133 smartphones released in
2006 included a 1.3 megapixel digital camera, a slot for a
microSD Card, 240 x 320 Quarter-VGA colour (16.7
million colours), 128 x 160 Thin-Film-Transistor Liquid-
Crystal Display (TFT) external screen (262,144 colours),
and Enhanced Data rates for GSM Evolution (EDGE) for
faster internet access. Nokia 613-613 phones had also
other features such as customizable the phone features
using the Nokia PC Suite (from 613), adding MP3 files as
ringtones (612), and the first phone ever embedded with
near field communication (NFC) capability (613).
In terms of design, the soft plastic is pleasant to touch
and comfortable to grip. The famous Nokia ‘horse-shoe’
decoration can be seen by silver frame on the front
encompassing the external display screen, logo and
camera; this time without any buttons. The weight was
112 grams and the top half gets thinner towards the edge
(20 mm) and does not reach the bottom part (creating an
interesting optical effect when phone is closed), as seen in
Figures and 25, with 92 mm length and 48 mm width.
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Figure 23. The Nokia 7650 keypad [25].
Figure 24. Nokia 6131 front view (closed).
Peripheral buttons (on/off and camera buttons on the right
side, and volume control buttons on left side) were rather
small and maybe difficult to recognize by touch. One
significant complaint about this phone is the rather
sensitive camera button that can be accidently activated
when the phone is opened or closed. To close the camera
application, the user has no choice but to open the phone
again. The opening mechanism is well-built but closing
the phone with only one hand can be a problem for some
people. The four-way navigation key stands out with a
chromium-plated frame with smooth and easy touch
orientation. The function keys are considered large
enough for finger control and other main keys such as
call/reject and context buttons surrounding the navigation
key are also consistent with previous keypad layout
designs [26].
The introduction of the 2007 Nokia N series (Figure 26)
would be the starting point of interface design
weaknesses, even though compacted with all sorts of
advanced features added such as; built-in GPS system, 5
megapixel Carl Zeiss optics camera, video and still image
editors, built-in WiFi, accelerometer, up to 8 GB internal
memory and larger displays (2.6 inches). The form factor
is a two-way slider, in which the left side is for
multimedia keys and right side for numbering/typing
(keypad). The size is considered large (99 mm x 53 mm x
21 mm) and rather heavy (120 grams).
Figure 25. Big sized display and keypad (opened) [21].
Overall, its external design interface failed to live up to
Nokia’s previous concept of simplicity, minimalism and
elegance. There are too many buttons for different
functions located on almost all sides, not to mention the
unnecessary multimedia keys. Referring to Figure 26,
notice how the main navigation button is surrounded by
multiple functions at same time, introducing difficult
touch orientation with the risk of accidently pushing the
wrong buttons while navigating. Call and reject buttons
are improperly sized and not distinct enough from other
context buttons. Four new buttons (edit, undo, menu,
home) are included near the navigation button, adding to
the confusing interface. The power button is on the left
side whereas the speaker, earphone jack and microSD
card slot on the bottom, camera at the back, and camera,
video gallery and volume rocker at the top.
The Nokia N97 (as shown in Figure 28), as the
successor of N95, was released in 2009 with a
touchscreen and tilt slide-out QWERTY keyboard. The
totally changed design interface was due to the space used
by its touchscreen. The simplicity of the keyboard layout
design can be clearly seen with previous navigation keys
no longer situated on front screen, except for the
call/reject keys and home button.
Between 2010 and 2012, Nokia focused on touchscreen
smartphones, no longer bearing its famous buttons or
keypads, except for power, volume control and camera
buttons, as seen in Figure 29. The Nokia X series was
released in early 2010, and the X6 model was considered
a more tactile and comfortable device to handle, either by
stroking with a finger or swiping with the thumb across
the screen since the display size is relatively small (3.9
inches).
The almost curved trapezoidal shape fits and sits
comfortably in the hand even though some people
complained of the cheap and easily bendable feel of the
back cover. The front side of the phone included the
call/end and menu buttons with different backlight colours
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for each button. It operated on the Symbian OS and
weight about 120 grams. To unlock the touch screen, the
key-lock slider on the right side had to be pulled toward
the base (it may have been too stiff and at an
uncomfortable location). The volume at the top and
camera shutter at the bottom right is considered Nokia’s
typical design for smartphones [30]. The last of the Nokia
N series released in early 2012, the N900, was also the
last flagship Nokia smartphone before merging with
Microsoft Corporation (in later years, the Lumia is known
as a Microsoft smartphone instead of Nokia).
The N9 series (Figure 31) runs on the Linux-based
MeeGo “Harmattan” OS (no longer in operation) in order
to compete with iOS and Android. Its minimalist external
design made the N9 as Nokia’s finest smartphone design
to date: 854 x 480 pixel resolution, 3.9-inch AMOLED
display, 135 grams in weight, scratch resistant curved
glass, polycarbonate casing for high durability, 8-
megapixel camera, NFC capabilities and no buttons on the
face of the phone [31]. The curve of the front display
surface is to improve the quality of the screen by bringing
it closer to the glass, and at the bottom right is the front-
facing VGA camera, unlike any other common
smartphones design. There is no more physical camera
button to reduce wobbliness when taking a snapshot. The
only physical buttons are volume control and the power
button on right side. The main criticism of this phone is
the lack of software capabilities, slow response (especially
when swiping or sliding) and a lack of compatibility with
many internet graphical plug-ins due to the MeeGo OS.
Figure 26. The Swiss Army knife Nokia N95 model [27].
Figure 27. Comparison between iPhone and Nokia N95 [28].
Figure 28. Nokia N97 [29].
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Figure 29. View angles of the Nokia X6 [32].
Figure 30. Slightly curved to the edge for a comfortable grip [30].
Figure 31. Nokia’s last flagship smartphone, the Nokia N9 [33].
IV. USER AND MARKET VIEWS ON NOKIA PHONES
The following is the impression and feedback of the
Nokia user market for phones and smartphones between
the 1990s until about 2011:
a) In 1996, the Nokia 9000 Communicator was
considered consumer friendly and having amazing
innovative breakthroughs. It had all-in-one
capabilities (email, fax, internet, word and
spreadsheet), but was not commercially successful. In
the same year, the Nokia 2100 series was famous for
the first Nokia tune ringtone and sold around 20
million units worldwide [34].
b) In 1997, the Nokia 5110-6110 series was famous for
the Snake game, fluid system menu, text messaging,
organic ovoid design, snap-on covers with a wide
range of colours, internal antennas, email and a big
display [34].
c) In 1998, nearly 41 million units of the Nokia 6100
sold, as it was a success compared to Motorola, and
Nokia became the top mobile phone maker [35].
d) In 1999, the Nokia 3110-3310 series with many
ringtones, games, MMS and SMS was versatile and a
pleasure to use. It was also considered as one of the
most popular phones in history and sold around 160
million units. By the end of 1999, Nokia sales
increased 50% year-on-year, and profits shot up
nearly 75%. Their stock price reached 220% [35].
e) In early 2000, the budget-friendly Nokia 1100 series
sold around 250 million units and was also
considered the best selling phones in the world [35].
f) In 2007, the specification differences between the
Nokia N95 and iPhone were perhaps too obvious; i.e.
the lack of 3G support, poor camera quality, small
screen, no touch capabilities, complicated and
cumbersome interface, slow and sluggish Symbian
OS, no user-friendly app customization, and difficult
to use compared to new touchscreen devices [36].
Although it was among the most feature-packed
phones at that time, with iPhone coming about, the
brand failed to impress customers [37].
g) As Apple launched its first iPhone generation in
2007, Nokia introduced its first all touch smartphone
in 2008 as 5800 Xpress Music with the Symbian OS.
Although it sold around 8 million units, it didn’t
manage to compete with iPhone’s quality as the
touch-experience was sub-par [35]. Nokia was at its
peak in 2007, but the market sat at 15% market share
due to low-end basic phones models.
h) In 2008, Nokia sales decreased 3.1% as the first
Android version was launched. It was also reported
that Nokia was slow in the mobile phone market to
satisfy customer expectations compared to other
smartphone manufacturers at that time. To make
matters worse, 46 million faulty phone batteries were
also identified between 2005 until 2007 [35].
i) Between 2010 and 2012, users entered the world of
touchscreen smartphones with the X and N series.
After partnership with Microsoft, the Nokia Lumia
920 series (although with Windows Phones OS) were
considered among the best-selling phones at
Amazon.com due to high build quality, good camera
quality and a top-notch suite of integrated apps.
However, many customers sold off their Lumia
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phones for other brands due to its missing third-party
app support, heavy bulk and thickness, overheating
issue, short battery life when using GPS or Maps,
blurry captured images, slow picture taking, difficulty
to transfer video to YouTube, and with a relatively
high price for its specifications. In short, it was still
unable to compete with the iPhone and Samsung
brands even with such innovations [38].
In 2000, Nokia’s market was valued around 210 billion
USD (over 40% market share in US), and 30.6% global
market share, followed by Motorola (13.3%), Ericsson
(9.7%) and Siemen (8.6%). In 2005, Nokia’s market value
shrunk to 75 billion USD and down 14% in US market
share outperformed by Motorola. After 2010, Nokia’s
global market settled to about to 28%, indicating the
general decline of the Nokia smartphone business [39].
V. IMPACT OF NOKIA PRODUCT DEVELOPMENT ON
STAKEHOLDERS
Due to stiff competition in the consumer electronics
market, there was a sharp drop in the company’s profits
after 1987. Nokia’s Chairman Kari Kairamo committed
suicide by hanging himself probably due to the stress, and
under new leadership, Nokia was divided into units. In the
1990s, Nokia sold almost all of its other divisions, and
changed focus only to mobile phone production [35]. In
the years between 1990 until early 2000s, ‘Nokia’ became
a household name for mobile phones.
In 1998, Nokia overthrew Motorola as largest phone
manufacturer. Embracing “Nokia DNA”, a concept that
has a distinct but consistent look, Nokia engineers and
designers experimented with multiple designs and
engaged in extensive research. However, the refusal to
change the design turned out to be one of the reasons of
Nokia’s decline. Nokia abandoned the US market for
customized products, reducing the production of flip
phones which were common in the 2000s. Tuong Nguyen,
one of the Gartner analysts commented that, “Nokia
wasn’t delivering, or not delivering quickly enough. The
Korean vendors could deliver it faster, and they were able
to pick up on (Nokia’s) weaknesses” [39].
In mid 2007, Nokia and the Symbian OS were on top
before the iPhone was released. Symbian devices had a
65% market share. Symbian was considered a kind of
Android before the actual Android (e.g. choices on the
app store, games, supports touch, large-screen devices,
UI, web browsing). According to a journal article written
by former Symbian executive David Woo and Professor
Joel West, the after-market software sales for Symbian
smartphones remained low. For example, Apple managed
to hit 100,000 apps in a year, compared to 7 years with
10,000 apps for Symbian. It was also reported that Nokia
was unable to sell Symbian apps conveniently and as easy
as the Apple store due to the fact that it did not have any
app store.
It had a license fee, no unified and complete UI
developed with the OS, a fragmented app community, was
limited to legacy code, did not have flexibility for third-
parties to develop Symbian apps, was very slow to decide
on the open source issue, and was challenged to adapt to
modern APIs and better development tools. Figure 32
shows the downfall of the Symbian market share. User
experience was not competitive in the Series 60 and the
UI was still behind competition. From this point, apps did
matter a lot and Nokia’s Symbian was found wanting; for
example, there was no official Twitter app for Symbian.
The problem-ridden Symbian OS made Nokia decide to
stop the platform in 2011 and converted to Windows OS
phones instead [39].
Figure 32. Symbian Market Share [39].2
2 “Android before Android The long, strange history of Symbian and why it matters for Nokia's future”; http://www.zdnet.com/article/android-before-
android-the-long-strange-history-of-symbian-and-why-it-matters-for-nokias-future/.
electronic Journal of Computer Science and Information Technology (eJCSIT), Vol. 6, No. 1, 2016
B. Borhanuddin and A. Iqbal, Nokia: An Historical Case Study
12
Due to decisions made in the year 2000, in which there
was a need for as many 40 or 50 models a year, Nokia
established component workshops and lost its product-
cantered approached. A former Nokia manager said that
they forgot that the company was actually selling mobile
phones for people; the product became characterless,
standard fare devices combined together out of basic
components and not really differing one from another in
any meaningful way. Innovative and creative thinking was
replaced by factory thinking (similar perhaps to how
many universities and colleges are becoming more and
more profit-oriented rather than focusing on the actual
quality of education). In 2008, Nokia decided to
discontinue the cellular modem and focus on the CPU and
modem as one system-on-a-chip (SOC). In 2009,
consumers were getting more conscious of what apps to
expect in their phones, and many developers focused on
iOS and Android platforms, moving away from Symbian.
Nokia still lacked the app store (a year after Apple App
Store) and had a bad user interface design. The N97
model was among the worst due to its high price and low
technical specifications compared with the iPhone, which
had better specs and a cheaper price [39]. In the same
year, Nokia laid off 1,700 employees worldwide. The
mobile phone market had changed direction toward
Apple, Blackberry, and newcomers like HTC, LG and
Samsung.
In 2010, 91% of developers were interested in
developing for the iPhone, 82% for Android, 28% for
Windows Phone 7, whereas Symbian dropped to just
13%. In the same year, Samsung and Sony Ericsson
abandoned the Symbian platform. Since CEO Stephen
Elop was appointed in 2010 and saw a rise in profits, job
cuts continued aggressively. The MeeGo OS in 2011 was
too late to compete with Android and iOS.
The view was also clouded by the “phone-first”
concept, not what the web companies predicted (that the
future will be about data, not voice). Nokia also reportedly
did not understand the significance of apps, software and
building an ecosystem around the apps. Additionally, they
underestimated the importance of third-party apps in
smartphones. Many consumers are attracted to
smartphones that are more than just communication tools.
However, Nokia assumed that downloading apps was only
done by the minority of people [40]. Nokia’s specialty
was in fact is its hardware, not the software [39]. The
management failed to foresee that the Android platform
could catch up with it, as shown in Figure 33 below. In
September 2013, Nokia sold its Devices and Services to
Microsoft, ending its many years of mobile phones reign.
Figure 33. Android OS Market Share Compared to Symbian [39].
VI. LESSONS LEARNED BY NOKIAS DOWNFALL
The year 2000 and later saw the decline of Nokia as
wireless and internet technologies evolved quickly [35].
One author [41] concluded that Nokia failed to deliver
after 2005 in two main areas; value proposition and
marketing strategy. They did not seem to understand what
their value proposition was; without a strong proposition,
users do not have a reason to pay attention to it.
It should have something different and better; for
example, Apple was about their prestige and Samsung
about their versatility. Nokia did not have anything
special (they tried to make state-of-art cameras but it was
too late). Second, they do not know what marketing
should be focused on. For example, Nokia’s messaging is
all over the place, lacks consistency, and people do not
have any idea what makes Nokia better than other
alternatives. It was as if they focused on just random
factors of the moment.
Nokia took too long to embrace the smartphone
revolution, with many mistakes in strategy, and an
unwillingness to embrace drastic change (especially the
touchscreen trend) when it was required the most. Apple’s
iOS touchscreen-based software had revolutionized how
people interact with their phones in comparison with
Nokia’s Symbian OS. In the case of the Symbian OS, they
tried to add a touch feature to it to compete with the
iPhone, but unfortunately the patch failed to deliver a
fluid user experience.
Unlike Nokia, Samsung for example, has shown that
being a ‘fast follower’ is an important strategy to
electronic Journal of Computer Science and Information Technology (eJCSIT), Vol. 6, No. 1, 2016
B. Borhanuddin and A. Iqbal, Nokia: An Historical Case Study
13
compete. Nokia failed to realize how quickly they needed
to change and how swiftly Google’s Android would take
over the smartphone market. Choosing Windows OS
Phone over Android was also another flawed strategy that
cost their business [40]. These days, Nokia is just a part of
the Microsoft family.
VII. CONCLUSION
Nokia was truly famous for its physical interface design
and other ergonomic elements of its mobile phones. They
were creative especially in compacting such a complicated
physical interface design into a small portable device. The
transformation from clean and simple to complicated
interface design indicated that as technological
requirements become more advanced, so do the physical
interface layouts.
The introduction of touchscreen technology replaced all
these external interface design issues. Unfortunately for
Nokia, the rise of downloadable and customizable apps on
both the iOS and Android replaced their relatively
unfriendly Symbian OS used in Nokia phones, leaving it
unable to catch up in the modern smartphone market.
Nevertheless, there were many lessons to be learned from
this great company’s history. In its prime, it was an
example to all.
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... Nokia is Finnish multinational communications and IT corporation, which was founded in 1865 by Fredrik Idestam under the name of Nokia Katabolic [3,13]. The company went through various changes over its history [6]. ...
... The company went through various changes over its history [6]. Its business model has been transformed from different industries; rubber, paper, and cable company to mobile handsets and mobile telecommunication infrastructure [7,13]. The most prominent change happened between 1990 and 1996 when a fruitful transformation of the business model has been made to save the company from near bankruptcy and settled it on the path of becoming one of the world's great corporate success stories for more than a decade and a half [6]. ...
... For around eleven years (1977)(1978)(1979)(1980)(1981)(1982)(1983)(1984)(1985)(1986)(1987)(1988), Kari Kairamo was the CEO of Nokia. During his leadership, the company was transforming from a conglomerate to an internationally large multi-industry firm with an emphasis on telecommunication devices [3], mainly network equipment and digital switches for the telephone exchange [13]. This period has been considered as the era of growth, represented by the remarkable joint venture with Salora to develop the radio telephone company Mobira Oy in 1979, followed by the acquisition of ten large electronic and telecommunication companies [17]. ...
Conference Paper
Full-text available
This research intensively reviews and analyzes the strategic management of technology at Nokia Corporation. Using traditional narrative literature review and secondary sources, we reviewed and analyzed the historical transformation of Nokia’s core business, leadership strategies, business architecture, R&D policy, innovation strategy, product lunch, and smartphones recognition and demonstration. We identified various strategic gaps that the previous analytical studies seemingly have missed to identify and generalize. Therefore, we add to the literature a bundle of the lessons learned that chronologically explain how Nokia failed to create and sustain competitive advantages, particularly in the smartphone market. We concluded that the problem at Nokia was not the lack of innovation, but rather, it was the lack of a precise technology forecasting, and misunderstanding that the needs in smartphone market were not just about demonstrating a mobile phone that makes calls, texts and connects to the web, but also the platform that operates all these functions together. Since Nokia’s brand name is recently back in the market through a newly licensed firm (HMD Global), we further discuss how likely the new Nokia’s smartphones will possibly compete and plausibly succeed in a very well-established market.
... In the 1860s, Nokia was a pulp and paper company. It gradually moved into the rubber and cable businesses, followed by electronics (TV and ICT) and network and mobile technologies in the 1990s and lately the consumer market (Borhanuddin & Iqbal, 2016). Kurikka et al. (2018) present Nokia as a case of regional resilience while Nair et al. (2014) as a case where resilience was missing. ...
Chapter
Full-text available
Resilience has attracted a multitude of scholars from diverse backgrounds and disciplines as it is a desired feature for responding to the adversities that modern societal systems face, not least the Covid-19 pandemic. Existing research displays little convergence on the definition of the concept making a robust theoretical framework and empirical understanding of resilience highly desirable. The aim of this chapter is to provide a more holistic understanding of the complex phenomenon of resilience from a multi-sectorial, cross-national and multidisciplinary perspective by proposing an original approach into the state of the art that might enhance future research. This chapter identifies three organizing principles for a framework of resilience. First, resilience embeds both stability and change which are both required elements. Second, adversities and their novelty profile can be mapped onto a typology of absorptive, adaptive and transformative resilience. Third, resilience has a temporal dimension that can be articulated in regard to forecasting, mechanisms and outcomes. The chapters of this edited book are positioned and connected by applying these three principles, in order to both enable theory testing and theory development throughout the volume and provide key empirical insights useful for societies, organizations and individuals.
... Any organization may gain some insight about competitors' next cause of action; however, whether or not this intelligence is critical to the competition is something that can only be uncovered through acute learning capabilities. Global brands such as Nokia have paid dearly for refusing to learn from competitor and market insights regarding the future of smartphones (Borhanuddin and Iqbal, 2016;Sata, 2013). This regressed the one-time market leader to an irrecoverable position of a market failure. ...
Article
Full-text available
Purpose The purpose of this paper is to provide insights into the overarching role of learning capabilities by presenting a framework to describe how learning capability development is captured by combining the three main elements of internal marketing orientation, exploratory capabilities and resource recombination. Design/methodology/approach This is a conceptual paper building upon the theoretical integration approach of Mayer and Sparrowe (2013) to establish competitive empowerment through learning capability development, effective internal response and resources recombination. Findings The competitive learning capability model provides a firm’s foundation for theorizing organizational competitive models from an internal perspective, by mastering learning capability development at the centre of the model. Research limitations/implications The paper emphasizes the competitive connotation of learning capabilities as a construct in strategic management. It shows the underlying role of learning across organizational processes; hence, its theoretical significance through the learning capabilities model. Practical implications This paper argues that learning is at the centre of organizational competitiveness. Firms can achieve more fruitful results by continuously implementing resource integration strategies built on their learned experiences. Originality/value The principal significance of this paper lies in the achievement of conceptualizing learning from a strategic management perspective. Insight in this area helps bridge organizational efforts in pursuit of competitive advantage by exploiting key core learning competencies embedded in a firm’s resources and capabilities.
Chapter
The production phase of the system life cycle represents the culmination of the system development process. This chapter describes where production considerations must be applied during each phase of system development in order to ensure that the end product is both affordable and satisfies performance and reliability goals. It reviews the problems typically encountered in the transitioning of responsibility from the engineering to the manufacturing organizations and the role of systems engineering in their resolution. The chapter discusses the organization of the overall system manufacturing program as a complex system in its own right, especially as it is typically distributed among a team of contractors during production operations. It also describes the scope of knowledge that development systems engineers need to acquire in order properly to lead a system development effort, together with some of the means by which it may be best obtained.
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