Nokia Brand Relives

When I bought my first phone in 2004, the versatile Nokia 6600, it offered the glimpse of the future of handheld computing by the then leader in mobile phones. The Nokia brand was so deeply etched into the consumers’ minds that it was as popular an “alternative term” for a mobile phones as “Xerox” has been for photocopiers.

However, the touch UI, internet-first, apps based platform nicely integrated into a slate form-factor by Apple four years later in form of iPhone was the real Eureka moment for the smartphone industry. The iPhone defined the new paradigm of mobile computing in the hands of consumers – also helped by the proliferation of 3G and 4G networks. The iPhone has, since then, replaced the “Nokia” brand in consumer’s minds. Now if a common man wants to buy a smartphone, many of them will go to the shop and say I want an iPhone (even though he would want a smartphone).

Since its market share peak in 2008, Nokia lost the plot. The combination of leadership changes, betting on the wrong computing platform (Windows Phone instead of Android) eventually led to an industry exit after being acquired by Microsoft. Microsoft underwent management changes of its own and under leadership of Satya Nadella, quickly pivoted to become more of a cloud and productivity platform company than a mobile hardware company. It ultimately chose to spin off the Nokia devices operations (manufacturing) to Foxconn (FIH) and other resources to HMD global. Nokia (the network infrastructure) company, has decided to license the “Nokia” brand to HMD Global which was formed by a number of ex-Nokia devices executives.

This gives a resurrection opportunity for the “Nokia” brand under HMD Global with its partnership with FIH, though the road won’t be easy. The following are some of the advantages and challenges which HMD Global faces as it tries to revive the Nokia brand.


  • The “Nokia” brand though much less strong now than Apple or even Samsung still has good brand equity and positioning effectiveness. It has almost skipped a generation of consumers, so Gen Z buyers may have the muscle memory for Nokia but not the stigma that it’s the brand that my parents use.
  • The Finnish culture and Scandinavian design will remain at the core and could help differentiate from the current sea of Chinese and Korean designed product
  • Independent and smaller, so HMD can be more agile
  • While leadership is still from the old Nokia, we believe most of them have learnt from the missteps happening in and around Nokia over the last decade or so
  • It looks like HMD will have access to Nokia’s Intellectual Property portfolio which will help scale globally without significant IP roadblocks
  • It will be operational from day one, considering the feature phone business is alive in more than 40 markets. HMD has accomplished the Herculean task of establishing subsidiary companies in a huge number of markets remarkably quickly
  • Feature Phones is still more than 350 million per year market this year globally and close to 300 million units next year i.e. close to US$6 Billion in revenue opportunity
  • Currently, Nokia branded FP biz has close to 11% share of this market from a peak of 34% before Microsoft’s acquisition of Nokia’s devices business.
  • To get back to 25% level would be the mid-term goal for HMD which is in turn around a billion dollar in revenues.
  • Feature Phone business will bring in cash flow to launch “Android” based smartphone portfolio in 2017
  • Close partnership with the number one mobile phone manufacturer in the world, Foxconn (FIH), brings greater scale, manufacturing advantage from start and will be pivotal to smartphone portfolio resurrection.
  • Getting close to Google, will be the key to drive home advantage
  • Inheriting back the “after sales service” network will also be important from the perspective that “Nokia Care” has been one of the key stickiness factors for many consumers and a greater part of the “Nokia” brand promises story.
  • There is still lots of hope among consumers and trade across several key markets of re-owning or re-selling a Nokia branded phone respectively, which is surely a positive.


  • While FP biz is a big near-to-mid term opportunity to get the business model rolling, transitioning to Android based smartphones with similar scale will be a daunting task. And even the feature phone business is not without its challenges. Microsoft was rapidly and radically downsizing its exposure to FP so both the portfolio and personnel were severely impacted. Pulling the feature phone business out of the fire will be a tough but urgent task.
  • More than 300 brands are competing in the Android smartphone space, out of which the top 20 brands control almost 80% of the total volume share and 95% of the value share and profits, its a blood bath out there. The game has changed since HMD’s management were kings of the hill. They will need to learn fast and play their cards right. Having said that, big market share shifts are still possible – vivo and OPPO have proven what can be done in China and India.
  • Differentiating on cutting edge design, manufacturing quality, choosing the right channel strategy by geography will remain a challenge. And this just as the smartphone business is beginning to shift to a new era of conversational AI mediated user interfaces.
  • Since the acquisition of Nokia devices by Microsoft, the entire channel, portfolio and network has been downsized quite a bit. To scale it back to levels of Apple, Samsung or Huawei will be a huge task and might not be possible for at least next three to four years, which means it will be difficult to see Nokia brand in the top ten manufacturers rankings anytime soon
  • Rebuilding Nokia brand in China, USA, Japan, Korea which are the key markets from value and volume perspective will be a mammoth task. Europe, Asia, Africa, India and Latin America will be the key first markets for HMD here to depend on penetrating and drive scale.
  • Establishing a good working relationship with FIH will be critical. Ensuring alignment of key objectives must be the priority; FIH is also driving InFocus and Sharp branded smartphones – so it may not be as single minded as HMD.

In summary, it is great to see Nokia brand reliving via HMD-FIH partnership. Coming back strongly will all depend on the tight supply chain control, differentiated design, Intellectual Property (IP) cushion and selection of right channel partners in coming years. On top of that HMD has to rebuild the Nokia brand in the consumer channel and rebuild a sales team that was once a dominant force in the industry. But an industry that has changed dramatically since Nokia’s glory days. While nothing is impossible, the mountain HMD-FIH is embarking on climbing is a tall one. And there’s a very real danger that when and if they get up high, they will find they’ve been climbing the wrong mountain.