Nokia has launched its new Lumia flagship, the 1020, in an event where it managed hardly to mention Windows Phone, and where it reminded the world of its undoubted prowess in handset engineering. The company, perhaps for the first time ever, has sorted out, and clearly communicated, its chosen differentiators, rather than relying on consumers to recognize its overall device quality by some kind of telepathy. Imaging ‘ the focus of the 1020 launch because of the famous 41-megapixel camera ‘ plus navigation and audio are the areas where Nokia has a real headstart over rivals, and for once that message is coming across loud and clear.
There is still a long way to go to address Nokia’s key failings when compared to Apple or Samsung ‘ its poor marketing abilities, and its software platform, based on the innovative but niche Windows Phone. In some ways, Nokia needs to do what the upstart mobile OS suppliers like Firefox are attempting ‘ to accept that Android and iOS will always have larger app stores, but to divert users from that issue by offering strong web services as well as, in Nokia’s case, killer hardware in selected functions.
While Windows Phone is hardly a modern, cloud-oriented OS like Firefox Mobile, Nokia is increasingly disguising it with a selection of killer apps such as Maps, and a broadening range of online services, like those which surround its navigation offering in the expanding Here system. Nokia did not mention its operating system until the twenty-eighth minute of its 35-minute presentation. And it is distracting reviewers and consumers from the fact the smartphone runs Windows Phone, rather than boasting of that, by going back to its roots in hardware innovation, and the days when the actual phone won over users, not the software.
But Nokia has learned lessons here. For too long, it beat the old drum that generic hardware quality ‘ durability, long battery life, industrial design ‘ should win the day. Now it knows that, while it may excel in those areas still, they are not differentiators for most consumers, except the Nokia faithful. So it needs to major on hardware which is wedded to the modern user experience, such as taking and sharing photos. It is focusing on imaging and audio, rather than video, where the Korean suppliers would surpass it, though it has invested heavily in screen technology too. The 1020 is a refreshing return to real hardware innovation, after a couple of years when this seemed to have stalled except, perhaps, in HD screens. Nokia has stepped into a vacuum left by the intense, Apple-defined focus on software differentiation, and is now playing to its strengths.
Ever since the Finnish firm first produced a smartphone, before Apple entered the game, it has majored on excellent camera and imaging technology, for instance with its long-standing partnership with Carl Zeiss for optics. However, it did not learn the key Apple lesson ‘ that a device can be mediocre in many respects, as long as it has a key feature that people believe they cannot do without.
It hopes that will be PureView. It has taken a while to bring this camera technology to Lumia. In February 2012 it unveiled the system, with its 41 megapixels, the most powerful camera ever to be included in a handset ‘ but this appeared commercially only in the niche PureView 808 model running Symbian.
Time will tell whether the camera is enough to generate converts to Lumia rather than just headlines, but at least Nokia is coming out fighting with some real differentiation ‘ technologies which, like its mapping platform, could even be licensed to others in future, and/or included in non-Windows devices. This is seen not just in Nokia’s defining functions of imaging and mapping ‘ audio is also a key area of investment, as seen in the 1020’s Rich Recording technology.
For now, it is standing by WP8, and has succeeded in reviving the interest of AT&T ‘ which once promised to be the biggest Windows Phone supporter in the world, but has recently been less supportive. It will launch the 1020 as a US exclusive on July 26 for $299 with two-year contract.
The phone has a 4.5-inch screen and the US version has AT&T software to store images and video in the cloud. It is almost a camera with other smartphone functions added as an afterthought ‘ it has no fewer than four photography applications, image stabilization technology, a manual shutter and xenon flash and other features. This is a rare area where Nokia has a genuine headstart on rivals ‘ most high end models boast 12-megapixel cameras or, like Apple, 8-mp, and a few vendors will introduce 20-mp during this year’s holiday season, but none is expected to reach 41-mp for several years.
The challenge will be to convince users that they need so many megapixels, notably by converting buyers of high end digital cameras to a handset; and that means getting the marketing messages right for Lumia, not traditionally Nokia’s strength, especially at a time when Microsoft is focusing its promotional efforts more on its own-branded products than those of partners ‘ and threatening, once again, to develop its own smartphones.
Malik Saadi, principal analyst at Informa, echoed the thoughts of many analysts, saying: ‘From a marketing perspective, cameraphones with quality close to SLR will attract a big audience’The question here is how to reach out to this audience, and what marketing message should Nokia send?’
Lumia sales climbed by 27% year-on-year to 5.6m units in the fourth quarter as Nokia expanded the range, and the firm predicted in April that at least 7.11m of the smarpthones would be sold during the second quarter.
Eventually, of course, Nokia may move away from Windows Phone ‘ to a new-look OS such as Firefox; to build its own Asha platform into a more powerful OS to span all kinds of devices; or to dump smartphones altogether and focus on achieving a multivendor base for its hardware and software innovations. There are already signs of this in mapping (see below), with Nokia Here increasingly divorced from Lumia. Even the Lumia-specific navigation applications will now be available for other suppliers’ WP8 products, Nokia said this week.
This indicates the way Nokia is building up its former Navteq assets, one of its few remaining crown jewels, as a business well beyond its own hardware. It already licenses elements of the platform to third parties such as Microsoft and Amazon.
Thom Brenner, VP of Windows Phone applications, said: “With the global release of Here Drive+ for all Windows Phone 8 devices we will further extend our Here business and deliver on our promise of making Here experiences available for as many people as possible. The more people are using our location offering the better it will get for everyone. At the same time this release also demonstrates our commitment to further strengthen the Windows Phone ecosystem with our maps assets.”
Nokia has also announced new releases of Here Drive+ and Here Transit. The former adds new features such as My Commute, which learns daily driving habits and provides personalized recommendations based on current traffic conditions. The latter gains a simplified user experience and new panorama view for simpler route planning. Here Transit will also be available for non-Nokia WP8 devices in selected markets.
Meanwhile, one of the difficulties of the Microsoft relationship has been the failure to extend it beyond handsets and Windows Phone. Nokia has failed to launch a tablet, partly, it seems to avoid clashing with Microsoft’s own Surface range, but this has left it confined to Windows Phone, increasingly a niche platform, and forced it to fall behind in riding the wave of larger-screened mobile devices.
The dilemmas were highlighted this week when images of a Nokia Windows RT tablet, now jettisoned, surfaced. According to The Verge blog, the 10.1-inch product was meant to launch this year, but has now been scrapped in favor of developing a slate running Intel-based Windows 8. That would rekindle Nokia’s shortlived alliance with Intel, while the Verge sources said the RT version would have run an Nvidia Tegra 3 processor and featured a magnetic power connector similar to the MagSafe in Apple Macbooks. There is no word on when the Windows 8 device might surface.
The disarray of the high end hardware provides even more reasons why Nokia should refocus its efforts on its web services, particularly those acquired with Navteq, as well as on its Asha ‘smart featurphones’ and Nokia Siemens.