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.

If you liked the post, you might find these interesting too:

• Nokia changes its naming conventions again. Gets back to pure numbers
• A new Nokia camera flagship with optical zoom to succeed N8 this spring. Still runs on Symbian
• Nokia E72, E52, N97 mini and other Symbian smartphones receive new software updates
• Nokia 700 and 701 to hit stores soon
• Nokia E7 is up for pre-order at Expansys, will ship on January 10 and cost a lot

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