Can Nokia surprise us with Lumia 920/820 Windows Phone, Q3 sales? With expectations so low, maybe they can

Nokia is in a really bad place right now.

Their initial bid for a turnaround with first generation of Lumia Windows Phones failed. Microsoft is pissed at them, and might be working on their own smartphone. Symbian smartphone sales fell off the cliff and are rapidly approaching zero. By giving up on Meltemi and “Qt for the next billion” Nokia abandoned the most important part of their low end strategy, and now has to resort to marketing S40 Asha feature phones as smartphones. Credit agencies are openly contemplating company break-up scenarios. And a consensus is forming in tech media that the second generation Lumia 920/820 Windows Phone 8 devices won’t be a hit Nokia needs.

It’s gloom and doom all around. Well deserved due to the mess Nokia made of the whole transition, the negativity is palpable.

With expectations so low, could Nokia be setting us up for a positive surprise? Let’s take a look at what could go right for Nokia in the next few months.

Third quarter sales. The expectations for Q3 results which Nokia reports next Thursday are extremely low. On June 20th Microsoft announced that Windows Phone 7.x devices will not be upgradable to WP8. Effectively telling all potential Lumia buyers that their handset will be obsolete come November and Osborning Windows Phone sales for July-September. With a month to go in the third quarter Nokia added to the misery with premature Lumia 920 and 820 WP8 device announcement. Nokia WP smartphone sales must have gone into the crapper since then.

Except, maybe, they have not. During Q2 earnings conference call on July 19th, Stephen Elop said that they did not notice any significant drop in sales since June 20th WP incompatibility announcement. And Nokia did not issue another profit warning about precipitous decline of its smartphone sales in Q3. Which, I believe, they would have had to do, if Lumia sales dropped way below 4 million they sold in the second quarter.

So if Nokia somehow managed to ship anywhere near 4 million Lumias in July-September – that would be very good news. Even if they’ve lost a bunch of money doing that. Then, if Nokia can report that they are starting to get some traction on the new Asha phones and deliver some growth and profits in the mobile phones division – it’ll make for a nice Q3 surprise.

Well executed Nokia 920 and 820 launch. So far the signs are not encouraging. We only know about few operators who will carry new Nokia Windows Phones, and what we know so far is not encouraging. Official Lumia 920 pre-order prices in Europe are also sky-high, especially when you compare them to Samsung Galaxy S3.

But at this point we don’t really know how Nokia plans to push Lumia 920 and 820. How many operators, what kind of subsidies and promotions are on the way.

And we also don’t know how Nokia’s new sales strategy, focusing on one or two operators per country for the exclusive concentrated push, will work. They’ve only tried it with AT&T in the U.S. for now, and first results don’t look too good. But this summer Nokia decided to adopt the U.S. approach worldwide, and promoted U.S. head of sales Chris Weber to implement it. So there should be something in the internal North American numbers to prompt Nokia into such a radical change.

One thing’s for sure – the old approach to sales that Nokia had from its days of mobile dominance, wasn’t working anymore. So there’s nothing much to lose in trying new things.

Both Nokia and Microsoft have allocated tremendous amounts of money for Windows Phone 8 launch. It is a make or break point for both of them, and they must be doing everything they can behind the scenes to make it a success. And, at the very least, Windows Phone 8 hardware support is more or less on par with competition this time. So there is a chance we may see a significant uptick in Windows Phone and Lumia sales in November.

Pureview. When Nokia announced Lumia 920 with 8 megapixel camera and slapped a Pureview label on it for some image stabilization/low light performance improvements, I thought – what the heck! Going from 41 mpx sensor down to 8 mpx, doing away with pixel oversampling in favor of some image stabilization gimmicks? They are destroying all the goodwill and buzz created over last  year!

But after thinking a bit more about it and seeing the sample images taken with Lumia 920, I’m starting to think that this image stabilization/low light stuff is a really big deal. Maybe even bigger than original 41 mpx Pureview.

I had a chance to try Nokia 808 for a few months, and I really loved the quality of pictures I took with it. But for those of us not obsessed with photography, in good light, the quality pics we can take with Samsung Galaxy S3 or iPhone is already good enough. Lossless zoom, pixel oversampling – cool. But so what? All I usually need is to take a quick shot, that will be viewed on my phone or PC. Pureview or not – 95% of the time I won’t really know the difference.

But blurry noisy pics I get after sunset and at all those parties? That’s probably one of the most, if not THE most annoying thing about smartphone cameras today. I’ll have to try Lumia 920 myself to make a definite opinion, but everything I already saw makes me drool about getting one.

And if, as Elop told Wired yesterday, they’ll be able to get special setups/enclosures in retail stores to demo Pureview 2.0 low- light camera advantages, if they can persuade sales reps to actually do that – Nokia 920 may have one really strong selling point.

These are some bright spots where, with expectations already so low, Nokia has a room for surprise. I really hope they deliver.

After dropping the ball in 2010 and losing almost everything in smartphones, the time is running out for Nokia. It has a chance to break through in Christmas quarter. If that does not work as expected – Nokia may have one more go with Spring 2013 Lumia line-up. But if they do not get their act together and start showing some serious Lumia growth before the end of Q1 2013, the game may be over before next summer.

I do hope those surprises are coming soon.

 

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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  • me altlas

    Nokia started the whole Amer phone craze they will be the lung again apple will fall hard, android will take a few tees but will be tied with nokia. I see it from a “on the streets point of view” everyone is saying they are tired of the ame ok iphone stuff and ate ready for something. New nd bright nokia is poised to give it to them

  • savaman2002

    This may be the dumbest article I’ve ever read. No fact at all… and the facts you do provide are garbage.

  • CJOO

    This was one of the black magical article ever i had read , but to the latest smart phone humping when android stucking with new come up and betting inovation nokia will for sure will rock the new generation smart phone market!!!!

  • http://galaxys3apps.org/ Galaxy S3 Apps

    Still really dont like the bright colours on the nokia ! Why not tone it down abit and it would be a really good phone ?
    http://galaxys3apps.org

  • Fhtagn

    The only ball Nokia dropped, was not sticking with the N9 and releasing it in the US market…

  • http://twitter.com/1095ToFreedom Alex

    A sound analysis, actually. You compiled a list of signs that actually may lead to believe that things are getting better for Nokia. Let’s hope so.

    The profit warning may yet come. But does a profit warning change things much for Nokia? Would a profit warning lower the impact of potentially bad Q3 as soon as the numbers are out? With NOK so low, probably not. NOK would go down more from two more rounds of bad news than just one.

    About the exclusivity deals – unless Nokia managed to sell more than 600k units through AT&T in Q3 (i.e. achieved some more traction compared to Q2), the idea is dead in the water.

    Let’s wait and see – Q4 will show how Nokia is actually doing.

  • http://profile.yahoo.com/EV2HC2XIHI7V2RGBDIYBPOLHYE Marco

    what a rubbish unintresting slow short minde article ….if i ever do a search on google and unwired pops up …..skip it….the only thing thats unwired is yr brain dude

  • postulation

    Then just buy black. What is the problem if other folks want a bright color. Would you not purchase a car because it is available in colors you don’t car for?

  • bibleverse1

    Until Nokia brings devices to prepaid carriers and cdma carriers they wont sell alot of phone in US.

  • Elias P

    Nokia to surprise? I don’t think so. I was in Cyprus last week (they hold the European presidency) and I thought I will try Nokia maps. Nowhere to be found. Zero! Nothing! Blank! Google has beautiful maps of Cyprus. Even the underperforming Apple maps include Cyprus. But Nokia??? So surprise? Yes I will be surprised if they achieve even the slight success.

  • MS 31684

    just having cyprus not on maps doesnt make them bad dude…they are working and will get cyprus maps soon…

  • MS 31684

    this is the dumbest comment i have ever read…:P

  • Ed_Luva

    Even under the best case scenario, Nokia’s exclusivity deal with AT&T will be disasterous for sales. Game over, Dude.

  • Boogie

    “But blurry noisy pics I get after sunset and at all those parties?
    That’s probably one of the most, if not THE most annoying thing about
    smartphone cameras today. I’ll have to try Lumia 920 myself to make a
    definite opinion, but everything I already saw makes me drool about
    getting one.”

    The “new” Pureview low light performance is for the most part based on slower shutter speeds, which the OIS enables. So you can have brighter pictures, but that doesn’t remove the blurriness of the moving objects in them. In fact, slower shutter speeds increase the motion blur. To remove that we’d need higher ISO or wider aperture to reach faster shutter speeds, and increasing ISO in small pixel sensors like those in cameraphones, would also increase noise drastically(removing noise removes also details, if we’re not using for that pixel binning ala Pureview 808). That is of course when we’re talking about pictures that have been taken without a flash.

  • vasras

    Nope. Q4 and Lumia 920 barely ships in volume and only in limited markets.

    No, the test is Q1/2013 and by then there’ll be lot of new announcement and competition.

    It’s a tight spot for Nokia .They still have too long product cycle and take too long time to get the channel stocked with units.

  • http://pulse.yahoo.com/_RSK4Z4DM6PNE6K3JIDAMURONCU Arun

    I think Nokia will still report loss. However I expect sales to increase from previous quarter to say like 6m. Remember blackberry held their sales for the last quarter due to discounting. Nokia have done the same in some markets. About the operators, AT&T was again a sad mistake. China Mobile maybe game changer

  • MS 31684

    you seems to be very intelligent fool here…bluring not only comes bcos of slow shutter speed but due to steadyness of camera lense..there is OIS lense which moves lense as per movement of camera and reduces any blurring effect..if ur not aware of new technology then keep ur mouth shut…keep ur photography knowledge with urself and stop fooling others..first try the lumia 920 in ur hand and then post…

  • http://www.facebook.com/ay.delacruz.9 Ay Delacruz