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Wednesday, September 15, 2010

Heads Roll as Nokia Prepares for iPhone War

BUYING GUIDE.

Nokia has been thrown into disarray, with its top two executives announcing they will be leaving the company on the eve of its biggest event of the year, Nokia World in London.

The Finnish handset maker is still the number one mobile manufacturer globally but its position has come under significant threat over the past two years with the rise of Apple's iPhone, RIM's BlackBerry and Google's Android platforms. Later this year it will have a new competitor: Microsoft's Windows Phone 7.

It is widely held that Nokia has failed to innovate in the high-end smartphone market and has lost significant mindshare. Its share price has lost more than half its value since the iPhone launched in 2007.

Anssi Vanjoki, Nokia's executive vice president of mobile solutions, announced his resignation today just days after the company dumped its CEO, Olli-Pekka Kallasvuo, for Microsoft executive Stephen Elop.

Further, Nokia's chairman, Jorma Ollila, may step down from the board after the company's general meeting in 2012, The New York Times reported.

The news comes as Nokia prepares to host Nokia World on September 14-15 in London. Kallasuvo and Vanjoki were slated to give opening keynotes at the event.

Vanjoki's abrupt resignation is curious given he only started in the job in July this year and vowed in a blog post at the time to "fightback" and ensure Nokia remained on top of the smartphone market.

"I am committed, perhaps even obsessed, with getting Nokia back to being number one in high-end devices," he wrote at the time.

In a statement released today Vanjoki, who will serve a notice period of six months before departing, did not comment on why he was leaving other than to say "the time has come to seek new opportunities in my life".

"At the same time, I am 100% committed to doing my best for Nokia until my very last working day," he said.

Elop, who was previously head of Microsoft's business software devision, is the first non-Finn to lead Nokia. He starts in the position on September 21.

The purge of Nokia's executive ranks is an apparent acknowledgment that the company has gone off track in recent years.

It comes on the heels of a Gartner report forecasting that Android would be the second largest mobile platform this year, before finally overtaking Nokia's Symbian for the number one spot in 2014.

In Australia, Apple's iPhone is on the verge of overtaking Nokia in smartphone sales this year, according to IDC.

The Symbian platform is older than both Android and the iPhone OS, and falls behind in a few key areas including user interface and apps. It wasn't designed from the ground up to be a touch screen interface.

Nokia will now be under significant pressure to unveil a change of direction and exciting new handsets at Nokia World this week.

Several analysts, including most recently Merrill Lynch, have predicted Nokia's upcoming N8 handset will give it a much-needed leg-up in the high-end smartphone space. Others have said Nokia should dump the Symbian platform and adopt Google's Android, which Motorola has done to strong effect this year.

The N8, which will be on sale in the coming weeks, is an entertainment-oriented smartphone with a 3.5-inch touchscreen (640x360 resolution), a 12-megapixel camera, the ability to shoot 720p high definition videos and 16GB of onboard memory, which can be expanded by an extra 32GB using the memory card slot.

The N8 supports Adobe Flash and multitasking. It includes an HDMI output for hooking it up to a flatscreen TV set and is capable of outputting Dolby Digital Plus Surround Sound.

Asher Moses travelled to London as a guest of Nokia.


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