Nokia Q2 highlights. S^3 50 mil – great news or fragmentation nightmare? OVI Store growth stalled. U.S.
Now that the results of another quarter for Nokia are in, it’s time to dive behind the headline numbers and reflect of what they can tell us about the state of Nokia today and in the nearest future.
Overall, Nokia Q2 financial results and the follow up conference call were pretty boring and predictable this time. All the big revelations were done last quarter, and things turned out more or less as I expected them to.
My overall impression is that, unless they somehow screw up and delay the launch of N8 again, Q2 2010 should mark the bottom in the decline of Nokia fortunes, and improvement is afoot. At least in the short term. Long term Nokia success or failure are still very much an open question, and will depend a lot of how they are able to execute in the next 12 months.
Apart from the general impression that this is the bottom, there were a few pretty interesting and disturbing things hidden in the Nokia Q2 report.
50 million Symbian^3 devices. Great news or a fragmentation nightmare?
The most interesting bit to come out of Nokia Q2 earnings – was the information, that according to conservative estimates, Nokia expects to ship 50 million Symbian^3 handsets over the life of the platform. At first glance it sounds like really great news. Both for Nokia and developers. Writing an app for a platform of 50 mil devices sounds like a very attractive opportunity. But only at first glance.
At the current pace, it will take at least a year for Nokia to sell 50 million Symbian^3 handsets. This seems to squash any lingering hopes I had that Nokia will wise up and will start offering OS upgrades (S^3–>S^4, and beyond), so their top of the line phones do not feel obsolete 6-7 months after release. The stuff their biggest smartphone competitors has been doing now for more then a year.
But what’s worse, this 50 million S^3 handset prediction means that at about this time next year, Nokia will be actively promoting 5 different smartphone platforms:
- S60 3d ed for non-touchscreen handsets
- S^1/ S60 5th ed. for cheap touchscreen smartphones
- S^3 for higher end/mid tier devices
- newly launched top of the line Symbian^4 smartphones
- Meego mobile computers
Unless I’m missing something very obvious here.
The thing I might be missing, is that the older S60.3 and S^1 versions of Symbian may reach the end of their lifetime, and Nokia won’t be releasing any new smartphones with them. Be it as it may, by the time first S^4 handsets arrive, Nokia C6 (S^1) and E5 (S60.3) will still be around and actively promoted.
Abandoning S^1 and S60.3 also does not seem in line with the current Nokia strategy of getting Symbian into cheaper and cheaper devices. Symbian^3 has significantly higher hardware requirements then Symbian^1, and that will limit how low Nokia can go with S^3 devices pricewise in the next 12-24 months. And unless Nokia decides to leave a highly popular and growing cheap QWERTY messaging phone category to S40, they don’t have anything to replace S60.3 with.
The massive fragmentation of Nokia Symbian smartphones, is already a huge problem for Symbian app developers. And instead of working on a solution, Nokia seems to be moving in the opposite direction. Yes QT on S^3,S^4 and Meego might help. But there’s that UI compatibility break between S^3 and S^4 coming. The more software centric and unified platform approach between different devices on S^3, that OPK mentioned yesterday, is also a good thing. But it does not change the fact that there will be another 4 Nokia platforms for developer to support next year.
OVI store growth has stalled
And, talking about apps and developers, things do not seem to be progressing very well on that front for Nokia too.
It looks like the growth of the OVI Store has now stalled. Last April OVI store growth numbers looked very impressive. Over the first 3 months of 2010, OVI Store downloads grew 70% – from 1 million a day, to 1.7 million a day. Three months later, Nokia is reporting the same 1.7 million apps a day download rate. Which isn’t bad per se, but compared to the way things are going on the competing platform app stores, it’s disturbing. As is the number of total “content items, including apps” available on OVI – 13 000…
About the U.S. market
During the earnings CC Nokia gave us their explanation of what went wrong with Nokia smartphones in the U.S during last 5-7 years. They basically blamed it all on Symbian (which was an independent company for the most of that time).
According to Nokia, U.S operator device testing process is much longer and stringent then on any network elsewhere. And from time to market perspective, earlier generations of Symbian OS just weren’t good enough. It took too long to pass through operator testing gauntlet to launch new Symbian smartphones early enough to be successful.
Sounds plausible? Yes. After all, it wasn’t only Nokia who failed to gain U.S. operator acceptance for their Symbian handsets. Motorola and Sony Ericsson haven’t made any big Symbian inroads in U.S. too.
Is it true, or the main reason for Nokia U.S. failure? I have no idea, and would love if some Symbian folks who were there at the time, could weigh in. But I have heard some things about Nokia arrogance, refusal to play ball with operators, etc; quite a few times before too
Anyway, that’s all water under the bridge now. Nokia has taken over the most of the Symbian OS code development, and swallowed most of the folks who actually write Symbian OS code from Symbian Ltd. So it will have nobody else but itself to blame if they fail in U.S. again.
Nokia management says that failure is not an option. U.S. market is their top priority right now. With Symbian^3 they have basically rewritten a huge chunk of the OS code, and now they will be able to get new S^3 and S^4 devices on U.S. networks quickly enough to make a difference. And OPK also said that he gave an explicit order to Meego team to prioritize the U.S. market.
Hopefully hings will soon turn around. Nokia assurances look promising. The problem is that after a decade of broken promises, I’ll have to start seeing to start believing.
Update with a well argued comment, that I don’t have any idea how to respond to from Nokia/Symbian developer POV:
A QT expert/developer comment from Marcus Christopher McFann:
I’m shocked, Staska, that you’ve written something like this on UnWired View. You have not done your homework, and it shows.
In the software development world, Qt is not a new thing at all. In fact, it is one of the most powerful cross platform application runtimes and graphics frameworks available. It has long been used in desktop development, and has also had support in Windows Mobile/CE.
The results should be evident in seeing VLC Media Player, Skype, Google Earth, and other apps using the same code on Windows, OSX, and Linux. There are also a few shared applications on Symbian and MeeGo as well to show how differing OSes can run the exact same application with no difference in experience.
As a writer, you have to seek the source for information. You may not see product at the moment, but the first device to ship with the Qt libraries preinstalled hasn’t even launched yet. But you could have merely contacted developers (and not just “mobile” developers using proprietary toolkits mired within their ecosystems without cross platform technologies) what they know of Qt from a performance and ease of use perspective. What I’ve seen is they are impressed across the board, and there is no noticeable latency vs. straight native code, just a faster way to get results.
Qt’s graphics heritage means it already autoscales, so the capability to support big display resolutions is already there. And separating the UI layer from the application underpinnings during development will allow developers to address multiple form factors and screen sizes, while updating and possibly offering multiple UI styles easily.
The reason you don’t see much momentum in mobile is Qt is the main toolkit for S^4 and MeeGo, and neither are present yet. The older OSes support Qt, but not out of the box. They benefit when apps hit the Ovi Store or other channels, but developers are waiting to experience the wave of new device sales expected with N8 and subsequent Qt enabled models.
There are many Qt videos showing developers working on apps that are well known, and will be coming as soon as Qt devices are more prevalent:
The best apps come from commercial developer houses looking for massive reach and installed base. This fills a void they have waited for. It is likely other OSes will look for Qt compatibility, and the Qt ecosystem, not the Nokia/Symbian/MeeGo ecosystems, will become like Java ecosystems of yesterday, just with better latency and API access and permissions.
You have to have an understanding of application development and the software design process to understand the opportunity this presents to developers that Android, iOS, and RIM have failed to deliver, and that is reach into every demographic and corner of the globe (maybe even the US) in devices from $140-800 mobile phones, netbooks, tablets, desktops, and even TVs and in car entertainment in the future
No idea about how to do mobile stuff development. So I respond with big picture bla bla bla:
Well, darn. I said I might be missin somethin. I’m not a developer. I don’t understand any of the things that it takes to make a Symbian app.
So, Marcus, you shouldn’t be so shocked about the things I wrote about as I see them. UV ain’t the site for developer minutea. All of us, the writers here, are just an outsiders trying to figure things out as we see them. No app development experience, no inside handset development knowledge, but we still try to do our best.
And I will easily admit that I haven’t done my homework as far as QT or Symbian or Maemo/Meego development is concerned. Why should I have? QT may be ” the most powerful cross platform application runtimes and graphics frameworks available“. On the desktop for now. But in mobile, sorry. Things might change very soon, but for now QT is, well, it’s some stuff Nokia has been talkin about for 2 years. In U.S. mobile – Nokia who? QT what?
I was lookin at the big picture, and all the Nokia’s efforts regarding QT, starting with the buyout of Trolltech in early 2008, well, except for uber buggy OVI Suite on PC, sorry, for me as Nokia customer, I haven’t seen anything interesting yet.
And you said it yourself in your comments – real power of QT will show itself only with S^4 and Meego. So please explain to me how that helps 50 million S^3 devices, S^1 and S60.30 on fragmentation issues I was talking about? Especially having in mind that QT has been available for S60.5thed/S^1 and Maemo/N900 for more then half a year now. Where the F are the apps?