Some thoughts on Nokia N8 and Nokia’s device strategy

Well, it’s been an interesting start of the week for Nokia.

Late Sunday night Russian site Mobile-review published a scathing impressions of a first rumored Nokia Symbian^3 handset – N8, which was promptly picked up up by almost every gadget/mobile news site on the internet.

Yesterday, full Nokia N8 specifications leaked. And, for a flagship device, they did not look too promising.

These days competitor flagships come with 1GHz CPU’s, lots of RAM and 1500 mAh batteries. Nokia N8’s 680 MHz CPU, 256MB of RAM and 1200 mAh battery didn’t look too good in comparison. These apparently weak specs, combined with extremely negative impressions of the new OS, created a perfect storm of negativity for the new Nokia smartphone.

Now, a  day later, and, probably, in part to stem that tide of negative publicity by getting their own side of the story out, Nokia officially announced N8. (And who said that Nokia can’t move fast :) )

So, did they succeed to turn the story around?  And, more importantly, now that we’ve heard both the negative impressions about S^3 OS, and the official story of N8 – what are the chances of success for the new device?

Well, IMHO, they are really great.

As someone mentioned in yesterdays N8 discussions, it’s all about managing expectations and competitive positioning.

The main reason for all the bashing of Nokia N8, was  because it was considered  to be a Nokia flagship device. With a flagship like price tag of 500+ Euro.

Finnish vendor management admit themselves, that they have a hole in their high end product portfolio. Which the new S^3 devices were supposed to plug. With the rumored N8 and other Nokia Symbian^3 handsets, the question everyone was asking was: whether the new Nokia devices will be able to compete with high end flagships from other vendors.

At expected 500 EUR+ price, Nokia N8, with ho-hum specs and aging S60/AVKON  based UI, was no match for Android and even Windows Mobile smartphones already on the market – HTC HD2, Nexus One, Desire, Sony Ericsson Xperia X10,  or Samsung Galaxy S. Not to mention upcoming Windows Phone 7, and other devices those vendors have planned to launch this fall.

But with a single stroke in a N8 announcement, Nokia managed to turn the tables around. It’s astonishingly low N8 price of 370 EUR. Suddenly Nokia N8 competes not with the high end flagships, but with the likes of  HTC Legend, Acer Liquid, Samsung Wave or Sony Ericsson Vivaz. And leaves most of the competitors scrambling to catch up.

It doesn’t matter much, that Symbian^3 interface isn’t fresh, exciting, or is just a minor refresh of S60 5th edition. At 370 EUR, a device with N8 like specs and even the current version of Symbian^1/S60.5 firmware, will be selling like hotcakes. But, except for the UI paradigm, Symbian^3 is a major improvement over S60.5. And Nokia still has 4 months, until N8 ships, to plug the remaining holes in the OS. So, come the holiday season, I expect Nokia N8, and other S^3 Nokia handsets to be among the best selling smartphones of Q4 2010.

What we are seeing here, seems to be the next step in Nokia’s strategy to regain it’s worldwide dominance throughout all tiers of the mobile market.

Nokia was caught flatfooted by the changes brought by iPhone to the perception of high end mobile phone. Their first response – Nokia N97 – was a major flop, which showed that they do not have anything to compete in high end touchscreen smartphone market. And won’t have anything until late 2010 or even 2011.

So their first step was to focus on  their strengths in the lower end of the smartphone market – 150-300 EUR range. Were they can introduce affordable handsets, with the UI, that is good enough at that price. And the devices like 5800XM, 5230 or C6 are doing very well there.

Now, with N8 and Symbian^3,  Nokia is moving up the value chain, introducing the handsets in the 350-450 EUR price range, with the spec sheets that very few competitors will be able to match profitably. And the interface that should be good enough, at least for the next 6-8 months (from September), until Symbian^4 UX is ready.

That still leaves Nokia without the real high end flagship, with top of the line UI and specs. But that’s were their next Maemo 6/Meego “mobile computer” comes in. It was supposed to ship this fall too, with Maemo 6 plugging the holes Nokia N900 had, and becoming first  consumer grade, top of the line Nokia Maemo flagship. But with the Maemo/Moblin merger, and creation Meego, I’m not sure what happened to those plans. I really hope they are still on, and we’ll see the first Nokia Meego handset this year.

As for Nokia N8, at least on paper, it  looks like a great device for the market it is targeted for, and a significant step for Nokia to regain it’s faded glory in mobile world.

Author: Stasys Bielinis

While I like to play with the latest gadgets, I am even more interested in broad technology trends. With mobile now taking over the world - following the latest technology news, looking for insights, sharing and discussing them with passionate audience - it's hard to imagine a better place for me to be. You can find me on Twitter as @UVStaska'

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  • jfourgeaud

    Definitely a good analysis of the situation.
    Nokia has always said that they wanted to “bring touch in every pocket”. Moving up with their products definitely improves the relationships with the customers.
    Someone who got a 5800XM for free almost 2 years ago, is now soon due to an upgrade from his operator.
    The N8 is the perfect candidate, especially after operator's rebate.
    With a keyboard, the N8 could definitely replace the N97/mini, and with their expertise, Nokia could decide to make that happen, and fast.
    Keeping in mind that the “8” in the N8 leaves room for a higher “9” grade N-Series, the next few months will be really interesting.
    Following Nokia's strategy, as you mentioned, we could expect the N9 to be the first Meego device, but not yet.
    First Nokia needs to exploit the N8 to power the next E-Series device.

  • useralberto

    Really well argued analysis, the best I have read so far. Good work!!
    Two question, do you think that it will be possible to update the N8 to the symbian 4? Will the hardware not support the full potential of the OS4?

  • Ant

    ok, how long those android flagships live with 1500 mah batteries from a single charge? Don't you know this? So goes to RAM etc. And btw, announcement date planned some months ago, why do you call nokia fast? One silly comment :)

  • http://www.staska.net Staska

    Thank's.

    Ragarding upgradeability to S^4, I am almost sure that you won't be able do that. Less to do with harware, then overall Nokia sales approach.

  • http://www.staska.net Staska

    I am well aware that Symbian is way ahead of every other OS, with, maybe the exception of RIM, in power management.

    The same goes for CPU, RAM management, etc;.

    I could have gone on about that stuff in the post for paragraphs. But that was not the point the article. The point was – that at the very high end – things like CPU, RAM, etc; matter for geeks/early adopters, tech press, etc; and overall marketing messages. And this was where people thought N8 was heading to compete in, so it seemed lacking. .

    While now, at EUR 370 Nokia N8 is super competitive device.

    As for the announcement, it may be a pure coincidence that Nokia announced N8 a day after the major leaks (negative MR review and full specs) hit the net, and they planned the announcement for today. But I seriously doubt that. Consider the event sequence:

    April 13th – Nokia holds a major virtual event (with paper invitations delivered to gadget websites by DHL, no less) to launch 3 low end, totally uninspiring handsets (C3, C6 and E5)

    April 22, Nokia Q1 financial results. Nokia announces that it's new Symbian^3 handsets are delayed until Q3 and shows declining handset ASPs, sending the stock price plummeting.

    Today, 3 (working days) after that Q1 CC, Nokia announces what is probably the most exciting new smartphone since N97 launched 18 months ago. Without any preparation, teasing, hints, etc. Just simple press release, and a bunch of videos uploaded to youtube. A day after a major leak occurred.

    Sounds much more like rushed release due to changed environment, then a well thought out product launch campaign.

  • Viipottaja

    Except that 5800 came out before N97.. ;)

  • ElfJay

    Nokia's 'MeeGo' handsets are still coming.

    I think MeeGo will be big. Unlike iPhone, Windows Phone, Bada and Blackberry, MeeGo is a totally open-source operating system, based on true Linux. This will add to its appeal, and automatically attract software developers.

  • Ant

    Sure globals can talk whatewer they want, but it's an opinion at least. Same goes to n900 leak last year couple of days prior to announcement. And this is not releval to, but aapl haven't announced iphone after leaks by gizmodo…

  • http://epcron.com Fiona

    Cool design, great features.. this perfect for me!

  • Tarun

    I think your post completely misses the 12MP Camera and related specs…

  • http://www.staska.net Staska

    Yes, it does, indeed. So what?

    12mpx, the best pics, Xenon, 720p, Dolby surround, HDMI, etc; might be
    cool for some. But it matters only a bit as a single feature.

    Just as 8mpx, or even 3 or 2mpx. Or some other supposedly “key” features. As
    Apple proved it. Along with Samsung Pixon 12MP and SE Satio.

    My post was not about one special spec, but about overall UX at a certain
    price point. 12mpx in N8 was just only one such spec at this price point.

  • Less the Best

    At last a good analysis!!

    Thank You!!

    I've been so fed up with these “Nokia's new flagship” writings. N8 is NOT flagship. The price doesn't indicate that. Specs don't indicate that. Even Model number (N8) isn't indicating that. N8Xs have been camera phones.

  • miksuh

    AFAIK Symbian ^3 has support for the writeable data paging. This means that Symbian ^3 will be able to use efficient virtual memory suited to mobile devices using flash file systems So who wants only 512MB of physical RAM when you can have 256MB RAM and eg. 16GB of virtual memory :-)