The Wall Street Journal reports that Nokia has started a search for its next CEO, to replace Olli-Pekka Kallasvuo as Nokia’s No.1. A decision will apparently be made by the board members before the end of this month.
Whether or not this is warranted is not something that people outside of Nokia can possibly know. Are Nokia’s recent troubles at the high end of the phone market only Kallasvuo’s fault? I’d venture a guess and say probably not, but it doesn’t really matter.
Nokia are in desperate need of a shift of perception towards their company and their products. Because, after many months of the perception in the blogosphere and the media being that they just can’t compete at the high end (where most of the profits are), this has made its way into the thinking of stock market investors. Which led to very unsatisfying performance of Nokia’s shares.
And people need ‘heads to roll’ so they can assume that things have changed.
The latest re-org saw Anssi Vanjoki get the second-most important position in Nokia, and now it may be time for a new CEO to calm down and reassure investors that the future at the high end of the mobile market will be Nokia’s again some day.
In recent years, Nokia has successfully made great steps towards ‘democratizing’ the smartphone, getting smartphones to very low price levels that were previously the territory of featurephones. However, this trend seems to be slowing down. Also, competitors are starting to announce low-end and midrange Android-powered smartphones at similar price points with Nokia’s Symbian-based offerings.
These may start to eat in what is one of Nokia’s best selling price ranges. As a result, without dramatic changes, by this time next year Nokia’s lead in below-300 euro smartphones may have vanished or shrinked considerably.
Which is bad. Now, there’s no question that Nokia will remain the world’s biggest phone manufacturer for years to come. Whether or not it can keep the crown in smartphones as well is what’s at stake here.
Along with Nokia’s brand image. Most lower end phones are purchased under the influence of the same brand’s higher-end offerings, and if Nokia continues to struggle in bringing a drool-worthy smartphone to market, in a few years even its featurephone lead may be in jeopardy.
So however cosmetic and/or unwarranted, a CEO change may just give Nokia some breathing room for the next few months. Or who knows, even a decent strategy to regain the market losses at the very high end.
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