Sunday, 28 August 2011

Nokia's Downfall: A Self-Inflicted Wound

Update Sep/Oct 2011 - The N9 Meego phone has finally launched. TechCrunch has labelled it "the most amazing phone you'll never buy".

Nokia's fall has been sudden and swift. They have lost the smartphone wars decisively: Unable to mount a competitive response to the iPhone and Android, their last-generation platforms have been spectacularly outclassed, and their efforts to produce something new were too little, too late. They bowed to this reality earlier this year, in a deal which makes them little more than a hardware manufacturer for the struggling Windows Mobile operating system. Plenty expect the rump of the once-proud phonemaker to be on the auction block within the next couple of years.

This is all true, as far as it goes. But what these accounts miss is that Nokia shouldn't have been reacting to this revolution in the first place. They were years ahead of it, until they squandered their industry leadership in a strategic blunder driven by internal politics.



The Promise

In November of 2005, three years before Google's first Android phone hit the shelves, and two years before the first iPhone, Nokia launched the 770 Internet Tablet. It was a small touch-screen computer, as thin but a little larger than my current-generation phone. Connecting via WiFi, or over Bluetooth to a phone in your pocket, it could browse the internet, watch videos, or check your email. It even supported Flash (this is in 2005, remember). Streaming video required RealPlayer, though, as Youtube hadn't even launched when it was released. Two years after its release, my 770 was still eliciting "ooh"s and "aah"s from my friends whenever I got it out and showed what it could do.

Even better, the 770 was built on existing, open technologies, making it a developer's dream. Like Android, its "Maemo" software was built on the Linux operating system, but unlike Android, it used X11 and GTK - the same user interface technology I'm using on my laptop right now. Linux developers were on familiar ground, and many applications required only minimal modifications. I ported TCL/Tk, a simple language for whipping up apps, to the 770 in an afternoon.

The device was so hotly anticipated that the pre-orders exceeded Nokia's manufacturing capacity. Launch-day orders were still being shipped in January 2006. Third-party applications exploded, with a mixture of existing Linux apps and new ones written from scratch by the growing community.

June 2006 brought a software update, including built-in SIP internet calling and instant messaging with Google Talk. Developers reacted with renewed enthusiasm. This was the future, and Nokia was making the running. The community was waiting for the inevitable next step: a "Maemo phone", a 770 with a SIM card.

That step never came.

Nokia released an upgraded tablet with more memory and a faster processor in 2007, and added a slide-out keyboard a few months later, but it quickly became apparent that Maemo was an orphaned platform. Despite the game-changing arrival of the iPhone that year, Nokia were inexplicably doubling down on the already-ageing Symbian OS.

A Bag of Wet Sand

Nokia's Symbian phones had led the smartphone market for years, giving the Symbian division great weight within the company. But Symbian was old software, and showing its age. Developing apps for Symbian was a painful experience, and Nokia seemed in no hurry to make it easier. The same year the 770 was launched, Nokia introduced "mandatory code signing" for Symbian, forcing developers to pay thousands of dollars to even try writing an application for their newest devices. This was done not for strategic reasons, but to mitigate the inherent insecurity of the Symbian OS, which allowed any installed application to essentially take over the phone. By 2008, this inflexibility and poverty of apps meant that the ComScore tracking organisation wasn't even counting Symbian as a smartphone platform.

The 770 was a fresh start, outside the existing feature-phone- and Symbian-centric structure of Nokia. From the outside, it often seemed as though the Internet Tablet team were a start-up within a company. They turned out revolutionary products at a rapid clip, but obviously lacked internal support in the face of a status-quo monolith that dominated the company's bureaucracy.

The Fall

The rest of the story is well-trodden. Despite attempts to update Symbian for touchscreens, it was clearly outmatched by the iPhone. Nokia panicked, and struck out incoherently in several directions at once. They continued to repeatedly kill their most promising platforms, then take years to ship a replacement.

Weeks before the first Android phone was released, in late 2008, they finally announced a Maemo phone. But it was over a year before the N900 was released, still plagued with hardware issues. By then, multiple manufacturers were offering Android devices, with a tiny but accelerating market share.

Within two months of the N900's release, Nokia had announced that they were jettisoning Maemo for a merger with Intel's unproven mobile Linux platform. With no follow-on hardware updates to iron out the N900's flaws, and a platform that had publicly been labelled a dead end, it sank like a stone.

Two years later, Nokia has yet to release a handset running the new "Meego" system. The window for new smartphone platforms has mostly closed, yielding a two-horse race between Android and the iPhone. By this point, Nokia would have faced a hard, uphill fight for third place.

The Microsoft tie-up has now effectively killed the Meego platform. The first - and presumably last - Meego handset will still be released this September. It has received excellent pre-release reviews.

Six months after the Microsoft deal that killed Meego, Nokia has yet to announce a single Windows 7 phone.

Throughout the company's thrashing decline, as more promising platforms were alternately strangled in their cribs and left languishing in under-resourced development hell, Nokia continued to release several new Symbian handsets per quarter. Somewhere in Finland, I am certain that there is still a Symbian division manager who is proud of this - who does not realise the cost at which this continuity was achieved.

What We Lost

Like all true tragedies, Nokia's death is ultimately self-inflicted, but my disappointment lies elsewhere. Their bureaucratic blindness not only cost them their command of the mobile market, but the vision of the smartphone future they almost represented. Android is pretty developer-friendly, but the idea that my phone should be a full computer is deeply appealing, and in many ways more powerful than the explicitly device-like model we now have instead.

The iPad's ambition is to replace the laptop, to "device-ify" the computer, at the expense of flexibility, openness and control. The 770 offered us instead the computer-ification of the device: occasionally messy, but open to boundless possibilities.

Attend any academic conference, or other gathering of geeks, and you will meet a few people still jealously guarding their N900s. They nurse the faulty hardware because warranty support has long since disappeared, and tolerate the abysmal battery life because they so value having a Real Damn Computer in their pockets. It is a good rule of thumb that what geeks are passionate about is a leading indicator - because where geeks are happy, they build things that will bring the users with them. Even after the first round or two of slaughtering their best platforms at birth, Nokia could still have drawn on these reserves of passion. Even then, they still had a chance.

I got my 770 out of the cupboard earlier today, and turned it on. The clasped hands on the startup screen felt out of place; once upon a time they would herald each new round of mobile innovation, and now I was faintly surprised to see them on anything good at all. In this elegant time capsule from 2005, I caught a glimpse of the mobile future we might have had. I rather wish I had seen it come to pass.

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