Nokia has unveiled two new, sleek Microsoft Windows phones, a first step in the ailing mobile phone maker's fightback against Apple and Google.
And just as Nokia is relying on Microsoft's platform to pull it out of the mire, Microsoft is counting on Nokia to finally give its Windows Phone 7 platform, which has a tiny share in the Australian smartphone market, the kickstart it needs.
The unveiling comes as the company struggles to hold its place as the world's top mobile phone maker, having recently posted a third quarter loss of 68 million euros ($92 million).
Whilst admitting “difficult moments” had been experienced and “tough decisions” made in his 13-month tenure at Nokia, chief executive Stephen Elop presented the two new smartphones, the first fruits of his big bet on Microsoft software, to a 3000-strong audience in London, saying they represented the beginning of a new era for the Finnish giant.
"It's a new dawn for Nokia," Elop said as he unveiled the high-end Lumia 800 and mid-range Lumia 710, which will go on sale in key European markets next month. Nokia was now “playing to win” and there would be “no holding back” or “second guessing”, he said.
In an embarrassing aside, Lumia means "prostitute" in Spanish.
Chris Carr, general manager at Nokia Australia, admitted the new smartphones would miss the Christmas period but said they would “definitely” be available next year in Australia and that the phone maker was currently “working with the channels ... to finalise the timing”.
“Obviously when you introduce a new ecosystem or a new operating system into the market there's a huge amount of education that needs to take place,” he said.
The Lumia 800, with vivid colours and a curved, black display, features Windows Phone's live icons on the home screen, which automatically update news, weather and Facebook feeds. It also boasts free navigation, a free mobile music-streaming app and Microsoft's new Internet Explorer 9 browser, and will sell for about 420 euros ($563) excluding taxes and subsidies. The Lumia 710 will sell for about 270 euros ($362). No Australian pricing has been announced.
Speaking before the unveiling, Foad Fadaghi, mobility and media analyst at Telsyte in Australia, said things for Nokia would “get worse” before they got better. “I think that the uncertainty around continued support of their existing [smartphone] models is going to cause them some issues,” he said, pointing to the MeeGo-powered N9 smartphone.
Microsoft's mobile platform has a market share of just 2-3 per cent worldwide, compared with Android's near 50 per cent and Apple's 15 per cent of the smartphone market.
Trevor Clarke, mobility analyst at research firm IDC, said before the unveiling that it wasn't going to be an “easy ask” for Nokia and Microsoft to win market share in “such a very high-paced” smartphone landscape. “You can already see that obviously with so many providers in that space there's a lot of growth. Across the Asia-Pacific region we're looking at over 30 per cent year-on-year shipment growth between 2011 and 2012, for example.”
Ben Wood, director of research at UK-based telecoms analysis firm CCS Insight, said the new Nokia smartphones were "a good start" but the reality was that they were "pretty much plain vanilla Windows Phone products".
"The real fruits of Nokia's and Microsoft's labours will come next year... but it remains a Herculean task to recapture this lucrative market from Apple and Android."
Others said that Microsoft's marketing muscle and Nokia's still-strong relationships with mobile phone operators should help push the new phones into the hands of consumers through prominence in stores and attractive package deals.
"The Lumia phones do have some strong selling points in their own right... and they offer a look and feel that's radically different from anything seen previously on a Nokia device," said John Delaney, research director at technology research firm IDC.
"These devices are strong contenders."
In February Nokia announced a partnership with Microsoft which would see it net “billions”. But it also meant its priorities would now lie with the Microsoft Windows Phone platform, meaning other platforms like MeeGo would no longer be installed on its new devices.
“They've announced that they're going to discontinue supporting [MeeGo] so it doesn't make sense for people to buy a phone that is one day going to have an outdated operating system,” Mr Fadaghi said of the N9, which launched earlier this month in Australia. The Lumia 800 physically looks almost identical to it. The main noticeable difference on the Lumia 800 is an extra camera button on the right-hand side and on-screen buttons.
The unveiling of Nokia's new smartphones came as Microsoft chief executive officer Steve Ballmer recently said that you had to be a computer scientist to operate Google Android-based smartphones. "You don't need to be a computer scientist to use a Windows phone and you do to use and Android phone," Ballmer said, according to The Telegraph.
Mr Fadaghi refuted Ballmer's comments. “That may have been the case with Android 1.6 [but] the latest versions of Android are a lot more user friendly.” Telsyte was seeing “all sorts” of people buying Android devices or saying that they wanted to buy Android devices, Mr Fadaghi said. “They're not just nerdy males. We're seeing a lot more females attracted to Android for the fact that [Android] devices have a lot of different looks and form factors. [They're] a little bit more personalised than just the standard iPhone.”
IDC analyst Mr Clarke disagreed with Ballmer too. “I certainly wouldn't agree that you would have to be a computer scientist to operate an Android,” he said.
Nokia also unveiled four new basic phones for emerging markets, where it still holds a leading position.
Ben Grubb travelled to London as a guest of Nokia
- With Reuters and AFP