Last week Nokia did something it had not done till now. The Finnish mobile phone maker for the first time launched its first ever tablet, over three years after Apple took the market by storm with its iconic iPad. Nokia had earlier introduced a 3G netbook in the market, about four years ago, but the product wasn't met with a lot of enthusiasm.
This time around Nokia has tried to make sure that it gets it right with the new Lumia 2520 tablet. The 10-inch tablet sports a full-HD display, with a super-fast Qualcomm quad-core processor. It runs on the latest version of Windows RT and manages to pack in as much brawn while still keeping its aesthetics intact. But the key question is whether the company has left it too late in the game or will it be able to bounce back riding on the impending acquisition by Microsoft.
According to Counterpoint Research, tablet sales volumes are poised to grow to 301 million units in 2014 at a growth rate of 28 per cent annually. A majority of these tablets sold, however, are Wi-Fi only (almost 82 per cent).
“Nokia’s Lumia 2520, which is a cellular tablet, should help it differentiate in operator-centric markets such as the US. It’s giving operators in these markets an opportunity to bundle the cellular LTE-enabled tablet with a data plan. So, while I don’t expect Nokia to make a huge dent in the tablet market in near-term, this is a good ploy to strengthen operator partnerships and succeed in developed markets,” says Neil Shah, Research Director, Devices and Ecosystems, Counterpoint Research.
With its flagship launches such as the Nokia Lumia 1020, released earlier this year, Nokia was still focusing on its imaging and app experience on a smartphone. With the new Lumia 1520, its 6-inch smartphone and its first-ever tablet, the Nokia Lumia 2520, the company has entered a US$170 Billion phablet and tablet segment globally. This is a segment where Nokia had been conspicuous by its absence until now.
However, the launch of a product is barely a gauge for how successful the product is going to be in the market, whether consumers will take to it as they have done to rivals such as the Apple iPad, and more importantly, it seldom is an indication of whether it’s potent enough to turn the company’s fortune around.
Design details
In terms of hardware, Nokia continues to impress. The new Lumia 1520 looks sleek with its candy-coloured options and a design that looks appealing. They’ve managed to translate it to the more affordable Lumia 1320, with a similar colour range and a decent body to flaunt. When it comes to specifications too there’s nothing Nokia doesn’t have that most high-end products don’t.
In a market where every user, young or old, has started paying as much importance, if not more, to aesthetics as to the device’s capability, Nokia seems to have covered their bases. With the new Lumia as well as Asha phones, they have some crazy fashionable colours as well as the option of sombre, mature blacks and whites. Their new crystal ice-like design on the Asha phones was integrated to make it more aesthetically appealing. A colourful panel, wrapped in crystal clear polycarbonate makes the new Asha phones look like they’re built to grab the younger user’s attention.
“We don’t design specifically for an age range but if it appeals to the youth that’s a great thing because there’s a lot of growth opportunity there,” says Peter Griffith, Head of Mobile Phone Design at Nokia. He adds that Nokia’s key goal has been to build the best devices we can given the price range and technology available. “And, the most important thing we aim to do is to perfect the things that people do many times a day on a device. There’s always the temptation to do a ‘Wow!’ feature but consumers just use it 2-3 times and forget about it,” says Peter.
One differentiating factor is that these products are based on the latest version of Windows, where as most others in the market are based either on Google’s Android or on Apple’s iOS.
Whether this aspect is an opportunity or a drawback for the company will be dictated by how well the software has been used to leverage the hardware.
“From a consumer’s perspective, I think it’s more a Windows versus iOS versus Android war rather than a Nokia versus Apple competition. The new combination of a Windows tablet on Nokia’s hardware is pretty unique. It has the potential to make a mark considering Nokia is a pretty trusted name,” says Vishal Tripathi, Principal Research Analyst, Gartner.
Notwithstanding how the tablet game plays out for Nokia, one lineup of devices, the Asha series is set to continue its success in the emerging markets. At a price point starting at about Rs 5,000, the upgraded Asha series will be integral in democratising the smartphone experience. The phones are now equipped with Equipped with capabilities such as 3G, Wi-Fi, deeper social integration with Facebook and Twitter and the proprietary Swipe UI.
Some may argue that the Asha series has spelt the premature but not unforeseen death of traditional feature phones, but that is not necessarily a bad thing to happen.
“Absence of WhatsApp on the Asha platform had been a deal breaker for many consumers, compelling them to switch to cheaper Androids in that price range,” points out Shah. This is not going to be the case anymore with both WhatsApp as well as Instagram coming on board with the Windows mobile platform.
The enterprise edge
Even if the company were not to consider consumers for a moment, it still has an added advantage over its rivals when it comes to business sand enterprise, owing to the Windows OS platform. “When it comes to BYOD (Bring Your Own Device), not many companies opt for Apple. Windows make it feasible to port applications to an enterprise environment. They don’t have to use a cross platform provider or turn to virtualisation to use those apps.” The same cannot be said of most other mobile platforms making the rounds.
Acquisition angle
A major deciding factor in how consumers look at Nokia is going to be Microsoft’s pending acquisition of the company. If the deal goes through, Microsoft has its work cut out on how to position and integrate the Nokia, Lumia and Asha brands with their ulterior motive to sell products under Microsoft’s own brand name.
“According to the fine print, Microsoft has been licensed to use the ‘Nokia’ or ‘Lumia’ or ‘Asha’ brands for next ten years, so its not the case that Microsoft has to instantly retire the brand name,” says Shah.
For consumers, both Nokia as well as Microsoft as big brands to be associated with. But Nokia as a brand is a lot more appealing when it comes to personal electronics considering the legacy it leaves behind as a company which once manufactured the sturdiest, most popular phones that an entire generation of consumers chose to use as their primary handset.
After Nokia had unveiled its tablet at Nokia World 2013, a lot of people, although impressed by the build and specs, were sceptical about how the tablet is justified considering Microsoft already has its Surface devices.
Shah feels, “The Nokia Lumia 2520 and the Surface 2 are being positioned very differently. While Nokia is focusing more on mobility and mostly aims to sell it through the operator channels in developed markets, Microsoft is selling its Surface devices directly to consumers and enterprises with multiple targeted models (SKUs).”
Future talk
While there’s still some time for the new devices to come to India, with the probability that the Asha and Lumia phones will land here before the tablet does, there’s hope that the tablet will do well. “It’s a interesting product because it’s not a low-cost, cheap-looking device, the kinds you see in emerging market. Nor is it extremely expensive so as to keep a bunch of buyers away. If they position and market the product right, it can spell a turnaround for Nokia,” says Tripathi.
According to Shah, Nokia will have to expand the phablet and tablet portfolio with multiple screen sizes (e.g. 5 inches or 7 inches) and introduce them at multiple price-points to take on competition such as Samsung.
However, to really zoom ahead or at least catch up with its rivals, Nokia (and Microsoft) need to make sure users get the best out of the Windows ecosystem, which still has some way to go. To get there Nokia will probably have to do many more things which it has not till now, but ahead of competition.