The Fading Nokia

Only available on StudyMode
  • Download(s) : 96
  • Published : November 20, 2012
Open Document
Text Preview
Contents
Contents
Introduction
1. Glorious period
2.1 Biggest market occupation
2.2 Essential and successful merger and acquisition
2.3.1 Merger with Siemens
2.3.2 Acquisition to NAVTEQ
2. Sagging situation at present
3.3 Severe competition in this area
3.4.3 Pressure from Apple and Samsung
3.4.4 No longer popularity of Symbian operational system 2.2 Lack of cash flowing
3. Analyze the causes resulting in the depression of Nokia
3.1 Failure investment
3.2 Losing the opportunity to achieve most value
4. Future and some suggestions
4.1Transformation to windows systems
4.2Get experience from other failed companies (Ericsson and Alcatel) Conclusion
References
Bibliography

Introduction

Nokia, the most well-known brand and biggest mobile company, once occupying over 60 percent sales in the market, has now dropped to less than 30 percent share of this area. What’s more, 90 percent of share price has evaporated since Apple launched the first iphone 5 years ago. Nowadays, its 15 years dominant position is totally taken placed by Apple and Samsung, in other words, the IOS and Android system are preferable to be chosen by customers rather than the old and past Symbian. What is worse, the news coming from official Nokia on June 14th shows that there will be 10 thousand staff fired by the end of 2013, causing the mobile phone area norm these days. It is truly the hardest time for Nokia now. As a result, this essay is aimed to describe the fading process of Nokia and explore the severe condition of it. In general, this project will be divided into 4 parts. Firstly, it will look at the glorious period of Nokia and give examples of some significant events, and the second part is going to analyze the sagging situation it is faced with, including the severe competition from Apple and Samsung, the falling trend in sales and the lack of cash flow. Thirdly it will explain the causes leading to the depression of Nokia, and I will give some constructive future suggestions towards the end of the subject.

Glorious period

1.1 Biggest market occupation
It is really surprising that Nokia was originally built as a paper factory in 1965, and 2 years later, it became a form technology company after a serious of merge operations .The year 1987 meant a significant turning point to Nokia, which launched the first mobile phone in the world, opening a new window to the phone’s development. This invention, actually, laid the foundation to Nokia to jump to the biggest mobile phone producer and helped to construct the Nokia destiny in the following 20 years. Until the year of 2007, Nokia still took the first place in market sale, stating officially that its profit surged 85 percent in the third quarter due to strong demand for low-cost phones in Africa, the Middle East and Asia, lifting its share of the global market to almost 40 percent. As Nokia profit soars near a half, while Samsung and Apple shared 13.5 percent and 6.5 percent occupations in the end of 2007. Figure 1 Worldwide converged smart mobile device market

Market shares Q4 2007, Q4 2006

Source: Canalys estimates, © canalys.com Ltd. 2008.
From the figure above, it can be seen that Nokia was far away ahead of other rivals and it seems no one could construct potential threat to the ‘mobile king’ at that time.

1.2 Essential and successful merger and acquisition
All successful companies need creativity and business events to adjust it all the time, therefore there is no doubt that Nokia will also follow this rule, in order to expand its business scale as well as increase the avenue profit. In fact, several mergers and acquisitions were done by Nokia in history, all bringing unexpected great results to this huge company. 1.2.1 Merger with Siemens

On June 2006, Nokia and Siemens were to merge their mobile and fixed-line phone network equipment...
tracking img