Nokia to transfer 2,800 staff to Accenture (AP)

HELSINKI – Nokia Corp. said Wednesday it has completed a deal to outsource Symbian software development to Accenture, including the transfer of 2,800 workers to the global management-consulting firm.

The announcement came two months after Nokia disclosed the plan as part of its aim to cut costs by $1.5 billion (euro1 billion) by 2013, including 7,000 global layoffs, and catch up with top rivals in the tough smartphone market.

The Finland-based company faces strong competition from Research in Motion's Blackberry, Apple's iPhone and Google's Android, as it continues to see market share fall. Last month it issued a big profits warning.

Nokia's share price has plunged in recent months and recently has been trading at multiyear lows of around euro4.20 ($6.05). Its stock closed at euro4.21 ($6.06) in Helsinki — unchanged from Tuesday's closing rate.

Nokia said Accenture PLC will provide it with software services through 2016 with the personnel transfer expected in October when the deal closes. Half of the workers are based in Finland with another 1,400 in China, India, Britain and the United States.

Besides the personnel transfer, Nokia has said it plans to lay off 4,000 people by the end of 2012, mostly in Denmark, Finland and Britain.

In another move to improve services, Nokia announced Wednesday that it will integrate its NAVTEQ mapping unit with social location services operations to develop "a new class of integrated social location products and services for consumers."

The struggling company, which claims more than 1.3 billion mobile customers, said it wants to provide new products and support for bringing the Internet "to the next billion."

It said the plan includes to develop platform services and local commerce services for device manufacturers, application developers, Internet services providers, merchants and advertisers.

CEO Stephen Elop said that focusing on location and commerce was "a natural next step" for the company.

"We will provide next generation social-location applications and commerce to differentiate Nokia," Elop said. "We also aim to extend our content and services offerings to all consumers by making them available to partners and customers on a wide variety of devices and operating systems."

Since 1998, Nokia has been the biggest seller of cell phones, but in the first quarter of this year Apple overtook it as the world's top handset vendor in revenue terms — reaching sales of $11.9 billion on shipments of 18.6 million devices against Nokia's revenue of $9.4 billion on shipments of 108.5 million units.

Although Nokia sold 432 million devices in 2010 — more than its three closest rivals combined — its market share continues to fall. At 29 percent in the first quarter, it's at its lowest level since the late 1990s.

Even more damaging has been Nokia's inability to meet modern challenges of the smartphone market, the lucrative sector in the handset industry, where Nokia used to be the leading innovator. Although it sold 24 million smartphones in the first quarter, 13 percent more than in 2010, its share in the sector plunged to 24 percent from 39 percent a year earlier.

On Tuesday, Nokia unveiled the N9 smartphone, based on its new MeeGo platform, but the handset received mixed reviews as markets are waiting to see the company's first Windows Phone. CEO Stephen Elop has said the Windows-based phone will be launched later this year with bulk sales expected in 2012.

In February, Nokia announced a major strategy shift when it partnered with Microsoft Corp., saying it will gradually replace Symbian and MeeGo platforms with the Window-based software that will become the main software used in Nokia cell phones.

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Online:

http://www.nokia.com

Nokia unveils N9 smartphone (Reuters)

SINGAPORE (Reuters) – Nokia Chief Executive Stephen Elop unveiled a new smartphone on Tuesday that uses software the firm plans to ditch, a move analysts said would probably condemn the device to obscurity.

Once the undisputed leader in hand phones, Nokia has rapidly lost ground in the smartphone market to Apple's iPhone and Google's Android devices, and at the low end of the market to Asian rivals such as China's ZTE and India's Micromax.

At a telecoms conference in Singapore, Elop reiterated that Nokia would launch its first smartphone using Microsoft's Windows platform later this year, even as he unveiled the new all-screen N9 smartphone, which uses a platform called MeeGo.

The model -- Nokia's first and last to use MeeGo -- can be navigated by a single finger swipe and comes in black, cyan and magenta colors in a polycarbonate design.

"It seems pointless to launch a phone like the N9 on a platform that has been cut by management," RBS analyst Didier Scemama in London said in a research note.

Elop said the N9 was part of Nokia's drive to introduce "an exciting experience around the user interface, the industrial design and the developer platform".

"Our primary smartphone strategy is to focus on the Windows phone," said Elop, who moved to Nokia from Microsoft last year.

"I have increased confidence that we will launch our first device based on the Windows platform later this year and we will ship our product in volume in 2012."

The MeeGo platform -- a newcomer in the market dominated by Google Inc and Apple Inc -- was born in February 2010 when Nokia and Intel unveiled a merger of Nokia's Linux Maemo software platform with Intel's Moblin, which is also based on Linux open-source software.

Nokia pulled back from the project four months ago.

"The N9 comes too close to the expected launch of Nokia's Windows Phone device to have any impact on its current smartphone woes," said Ben Wood, head of research at London-based mobile consultancy CCS Insight.

"The strength of rival ecosystems leaves little room for MeeGo powered devices. It's difficult to see the N9 being anything more than a niche device ... the N9 will be a tough sell."

Research firm IDC's analyst Melissa Chau said the N9 would probably be a prototype to showcase what Nokia can bring in future phones.

"I don't expect, and don't even think Nokia expects, this phone to turn around their fortunes," she said. "All it wants to do with the phone is to inspire some confidence in people that they are not out of the game yet."

Nokia's head of design Marko Ahtisaari, in a dig at Apple's iPhone 4, said the N9's polycarbonate body would give the phone "extremely good antenna performance, so unlike some competitor products, you do not need to hold it in special way to have reliable phonecalls".

FEW CLUES ON STRATEGY

Elop's speech in Singapore was billed by Nokia as "an update on progress in our new strategy", but he provided few details on how he planned to tackle the company's troubles.

Last month, Nokia said it had abandoned hope of meeting key targets just weeks after setting them, raising questions over whether Elop can deliver on a turnaround he promised in February.

Nokia's market value has plunged by more than half since February, after the leak of a memo from Elop that compared the company's market position to a man standing on a burning oil platform.

Nokia's market share has fallen in key markets. In China, for example, it has shrunk to 19 percent from 33 percent two years ago, research firm Gartner estimates.

So-called no-brand handset manufacturers -- small Chinese firms using low-cost chipsets -- control 45 percent of the market in the world's most populous country, Gartner said.

Nokia's woes bear a striking resemblance to troubles at Research In Motion, whose dismal results and failure to deliver exciting new devices on time pushed its shares more than 20 percent lower on Friday.

Shares in the Blackberry maker fell a further 7 percent on Monday after a marketing executive left the company, the second departure in four months and the latest news contributing to a halving in the company's market value this year.

IDC's Chau said Elop's presentation on Tuesday gave few clues on Nokia's future strategies to get back on track.

"From what they have announced today it is really hard to say because they left out so many details," she said.

"It will take a lot of cooperation between Microsoft and Nokia to do it and with this kind of business deal we only have a 50-50 percent (chance) to begin with."

Nokia also said it plans to launch up to 10 new smartphones using its own Symbian operating system. It introduced three affordable handsets which can use dual sim-cards, years after Asian rivals put such features into their phones.

"Any new products by Nokia will be a stop-gap ... until its first Microsoft phone is out in the market," said Seo Won-seok, an analyst at NH Investment & Securities in Seoul.

"It won't be easy for Nokia to aggressively market these products and even new product lineups will be limited given that it is spending heavy resources in developing Windows phones. Under such circumstances, I'm quite doubtful whether they'll get a strong response from customers."

In a research note this month, Nomura said Samsung Electronics would become the world's largest smartphone maker this quarter and Apple would take the number two spot next quarter, pushing Nokia to third place.

(Additional reporting by Saeed Azhar and Eveline Danubrata in SINGAPORE, Tarmo Virki in HELSINKI and Miyoung Kim in SEOUL; Writing by Raju Gopalakrishnan; Editing by Anshuman Daga and Dean Yates)

Report: Nokia CEO Will Kill MeeGo Even if N9 Succeeds (PC Magazine)

Not long after "leaking" Nokia's first Windows smartphone, codenamed "Sea Ray," CEO Stephen Elop told a Finnish newspaper that even if the new MeeGo-based N9, launched the day before, succeeds, it will be Nokia's last device on the Meego operating system.

"In Elop's words, there is no returning to MeeGo, even if the N9 turns out to be a hit," wrote the Finnish daily, the Helsingin Sanomat.

On Thursday, Elop stirred the blogosphere when he teased what he called the first Nokia Windows device, which is rumored to be launching this fall.

Unfortunately it left a sour taste in the mouths of MeeGo fans, most of whom are passionate, long-time Nokia users and developers. In February Elop, who joined Nokia from Microsoft in 2008, announced a billion-dollar agreement with Microsoft that puts the Windows Phone 7 operating system in Nokia handsets; Nokia's own Symbian and MeeGo operating systems would be relegated to "science projects."

"I have taken part in the conversations with the teleoperators and I have been part of the consumer test groups. The feedback has been extremely positive and I am sure that the Windows Phone system will be a great success", Elop says of the strategic partnership announced with microsoft in February of this year.

Elop desperately needs Nokia's recent partnership with Microsoft, which fills Nokia handsets with Microsoft's Windows Phone 7 operating system, to succeed. He faces lowered sales targets for the rest of the year, rumors of a Nokia selloff, layoffs in the thousands, and alienation by Nokia's most loyal followers.

In the same interview Elop said he was "sure" upcoming Nokia Windows phones would be a "great success."

"I understand completely that the investors want to see the results of our new strategy in their full glory. This will take some time, but once we are in a position to introduce the results of our strategy, I am sure the doubts will disperse," he said.