NYT: Nokia suffers from 'stifling bureaucratic culture'

By on Sep 27, 2010 at 11:52 AM
General September 27, 2010

The New York Times has an interesting piece up about the hardships Nokia’s new CEO, Stephen Elop, is about to face. Insiders and former employees describe the inner-workings of Nokia as a “stifling bureaucratic culture.” Citing the 2002 cancellation of a 3D user interface for Symbian handsets and the 2004 scrapping of a full-touchscreen prototype device and online mobile applications store, the Times details just what kind of corporate environment Mr. Elop is stepping into. “Proposals were often rejected because their payoffs were seen as too small,” said Ari Hakkarainen, a Nokia manager from 1999 to 2007. Kai Nyman, Nokia’s former chief architect for enterprise domain strategy, described the scrapping of a 3D interface his team had created in 2002; management rejected the idea as it added $2.05 in production costs to each handset. Samsung release the first 3D interface 7-years later in 2009. Nokia is still set to sell a mind-boggling 70 million smartphones this year — not to mention account for 1.6% of Finland’s GDP — let’s hope Mr. Elop can turn the corporate culture around.

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  • Android

    Time for some pee!

  • yellow_trash

    Nokia will end up the way of Blockbuster videos. Too egotistical to listen to consumer demands and let the Corporate managers decide what’s good for us.

  • Hollaman

    What nokia also suffers from: a crap os!

    Talk about your classic case of “not invented here syndrome”!

  • Tdot34

    Ouch canceled a full touchscreen and app store in 2004, in 2007 that is exactly what Apple unveiled and took the smartphone world by storm. Great vision Nokia.

    • Jarrett

      What isn’t said is whether the OS and App Store were a good experience. How was the UI? It is one thing to come up with a concept but yet another to deliver a good UI and experience. Just maybe those managers that nixed the product felt engineering missed on both marks. We don’t know because the engineers are going to say the nailed it and the managers will of course say they didn’t.

      I say keep giving them the funds to keep researching it though. Hell, the Lisa project didn’t go over so well but once Xerox “sold” PARC to Steve Jobs for Apple stock they eventually got the GUI correct inside Apple labs. Sometimes your ideas need a little more “something”.

      • Jarrett

        Incase anyone was not familiar with exactly where all the cool shit we use came from. Xerox PARC created the beginnings of damn near everything we use today. Good thing one company was intelligent enough to understand how to bring products to market.

      • Jeff

        Thank you Jarrett but people already knew this, like, forever ago. Anyway, originating some solid metaphors is not the same thing as bringing them to market and building an ecosystem.

        As far as the Nokia story goes, it can sometimes be a fine line between being careful with R&D budgets and stifling innovation. We can see from Apple’s example that having an engineer with a clear vision at the helm (and a boot to back it up) can innovate more quickly than a company of careful managers trying to keep risk in check.

    • sam

      Just because it reads so in NYT doesn’t mean it’s true. Nokia has been active in touch screens since early 2000, released first touchscreen phone 2005 (7710), since then they have been developing touch screens mostly in Maemo devices 770, n800, n900 and n9 this year.

      It’s just seems to be everyone’s favorite past time to come up with “what’s wrong with Nokia” stories backed with unsubstantiated fiction, even NYT that I once thought having some journalistic standards.

      So just don’t believe none of those stories without checking the facts yourself!

  • Jim

    It is ironic that the New York Times is criticizing something it so much embraces.

    • JK

      I’m truly ignorant on the subject.

      But I’d like to know how the NYT embraces Nokia?

      • Jim

        “bureaucratic culture”

  • Wild Bill

    Nokia is a classic case of a company who after becoming wildly successful thought it could rest on it’s past accomplishments and glories.

    A company can only do that for so long before it starts getting stale.

    • SBD

      like BlackBerry?

  • Wild Bill

    Yeah, but BB still has its legions of users that can still easily get their products at a competitive price. As long as they still have marketing and selling agreements through the carriers, they have more time to than Nokia to make the changes they need to make.

    Because of Nokia’s apparent refusal to buddy-up with the carriers, they are way behind the eight-ball.

    For years now, Nokia thought they could ignore the U.S Market. It’s worked for a while, but ultimately you have to compete in the U.S Market to sustain yourself.

    At least BB is doing that, so their chances are much better than Nokia’s IMO

  • John

    Typical, typical, typical corporate management. Lacey never listening to consumers and has 50 year old men trying to make hip technology decisions. Lol. Losers.

  • NuShrike

    It’s stifling from the other side of the tub with QtbyNokia also!

    They claim they’re OpenSource, but they then bury Qt contributions for edge cases they either don’t care about or don’t have enough payoff (for them) in their JIRA tracking system.

    If you then bring up how bloated in footprint Qt has become for embedded such as phones (QtWebkit lost a huge possible embedded deployment due to bloat), and how Nokia-centric it has become, they could care less. Not good signs for MeeGo beyond Nokia.

    Their recent blog about how they’re trying to make bug-reporting better is followed up with complaints of how alienating trying to report/contribute is. Of course, they’ve followed up that through JIRA that they take any complainer on their blogs as a spammer. Good job!

  • Deaconclgi

    The problem is that no one cared for some of these technologies until certain US companies started doing the same thing. For example, Nokia has was using phones with OMAP/PowerVR GPUs since atleast 2007 and the MAJORITY of you readers never had or knew or even used a phone with a GPU or with dedicated gaming. It wasn’t until certain companies did the same and got their devices in the hands of consumers through subsidized prices that the whole US smartphone industry started clamoring for GPU equipped phones. Nokia eventually decided GPUs were not profitable if developers and consumers were not going to ask for them so they stopped including them. THEN all of a sudden, phones started including GPUs and Nokia had already stopped doing that and they effectively shot themselves in the hardward foot.

    Same thing with cameras and video quality. Nokia had DVD-Quality video for years while everyone else was doing 15fps QFC video and 2-3MP stills. For years, you all have looked past Nokia’s award winning camera and video quality and NOW, all of a sudden “ooohhhh 5Mpix..HD….oohh”.

    Gaming: Nokia had a phone based gaming service (Ngage)AND a “repository” of software called Nokia Mosh well before any established app stores AND their phones could already do more with less apps. I was watching flash in the built in web browser before Skyfire ever hit alpha. Now…ooohhhh, xxxxOS has flash 10.1. We NEED flash!!! You all didn’t have flash for years until it became viable for you to get it on some carrier subsidized handset…

    TV OUT: Been doing that for years, stereo speakers, on device video and photo editing, unrestricted bluetooth and other technologies.

    Here is the problem. We americans are CHEAP. We want everything cheap and as pretty as possible. Nokia has not had cheap or pretty phones in the US. We are really cheap. If it is not LESS than $200 on 2 year contract, we complain. If it is $200 with a mail in rebate, WE COMPLAIN!

    You all missed out for years because you are either cheap OR too young at the time to pay for the tech that you wanted OR to young to know what you needed and had to wait for glitzy marketing to hand it to you.

    Bottom line: Apple, Google and the rest of these companies didn’t creat or invent the majority of the OS ideas that you so love today, they only made the flashier to attract you to them and cheap enough for you to afford them. Nokia failed on that part.

    Nokia under estimated the superficiallity and cheapness of the american market. Nokia believed if you build it, they will come. There is no technical reason that the Nseries from 2008 should have outsold every other phone and been more popular except for the fact that we are cheap and attracted to what is pretty more that what is useful.

    Finally, IF Nokia would have made the 3D interface or the App Store….AMERICANS STILL WOULD HAVE NOT BOUGHT THEIR PHONES!!!!!!! We are cheap and that overrides how pretty something is. The VAST majority of you would NOT own a single iPhone or Android device if you had to pay retail for it. That is the truth. If Apple did not secure a carrier contract like they did, the iPhone would have been just another phone because americans would NOT have paid $500 plus for it.

    Nokia faces this problem: They design and build devices for world use. The rest of the world isn’t as cheap and carrier restricted as the US. US companies design devices for the US, they will sell them on contract and impose any restrictions, whether manufacturer or carrier and YOU will still buy it for cheap on contract.

    Get this. I paid $529 for my Nokia N82. Americans say “WHAT?!?!” FOR THAT” Yea, and I have enjoyed DVD quality video, tv out, Quake 3 arena online, Ngage games like One, tethering, wifi hotspots, video calling, unrestricted GPS apps like Nokia Maps, Garmin XT, stereo speakers, xenon flash, high quality audio recording, GPU accleration, accelerometer, proximity sensor and MORE and this phone came out in 2007!!! It was WELL worth the $529 entry fee. Oh, and I can still multitask over 66 applications with ONLY 90MB!!!!. Also as a bonus, I was watching Hulu in my built in browser well before they got money hungry and started restricting it.

    I also paid $561 for my N900 and it does more than any other device. It doesn’t do all things, no device does.

    This is why it is crazy when people shout “Nokia sucks!!!, Symbian sucks” We need to take a look and see who did what historically and we will find that it is we, the american consumer that missed the technological curve because we ARE CHEAP AND MARKETING BAITS US LIKE A WORM ON A HOOK!!!!!

    Nokia didn’t know how to market to us because common sense tells Nokia that hardware and software do the talking yet here, in america, lesser hardware and lesser software talk louder if the price is right and that sense is NOT common. That is why Nokia leads everywhere in the world but in the US. Also, stop citing the N97, where were you before then, when Nokia had the most powerful hardware and software? The MAJORITY of you didn’t even buy the N97 because we are cheap. I didn’t buy it because I was smart enough to know that it was a weak phone and no amount of design polish and website traffic could convice me otherwise.

    Oh well, this post is too long. Either way, learn about Nokia for yourself, US media will always depict them as a failure.

    This new CEO is inheriting an entirely different Nokia than the one that canceled GPUs in phones in an entirely different smartphone battle.

    ALSO: Those that want to cite Nokia losing market share. Common math states that if more people enter the race, percentages change. Nokia is supposed to lose market share as competitors enter and get better. What? Is the 100% total market pie supposed to go up to 115% total market pie to “fit” an unchanged Nokia share while the newcomers increase their market share. No.

    • NuShrike

      How about citing why if Nokia was so superior, they never successfully sold their upper-end “smartphones” over Windows Mobile, Palm, RIM in the USA — ignoring the rest of the world.

      Actually, it can be argued that the latter 3 were also in the same boat. So then it can be argued that they were all in collusion in the same unimaginative fail boat of resistive touch-screens with silo’ed hardware/software deployment and no online unification (iTunes).

      Then Apple came along, threw that old box of fail out, and here we are now with phones of better cpus/gpus ram, sensors, etc than even DVR boxes.

      To note, I wanted a N95 (N97 was gay with no GPU) but I couldn’t justify it over its close development model (which they only just changed a FEW WEEKS AGO with the certs signing), tiny screen/res, and a usual lack of world 3G frequencies (I require USA+JP).

      • Deaconclgi

        I never said Nokia was superior but the phones that they made at that particular time were superior. Even the express music line of feature phones such as the Nokia 5300 and 5310 offered more features than similiarly priced phones at the time. My point was that Nokia is not as bad off as US media tries to make it look and that they have made great hardware with great software (OS and UI are different things) at a time when no one else was doing so. I also stated reasons why they failed in the US, our part and Nokias part of the failure.

  • Deaconclgi

    Oh, one last thing. An increase in production costs of over $2 per unit is a LOT considering you sell over nearly more 50million phones. Most companies would not even dare to increase costs by 15 cents unless it was guaranteed to return on investment. Nokia made the right decision. Now, GPUs are less expensive to include and they can stay fairly profitable and as we see, Symbian^3 is built upon GPU acceleration so ALL phones that use that OS will have a GPU. Nokia would not take a loss on every device to gain mindshare like some unnamed companies.

    • Jarrett

      And that is the difference between companies that go up and companies that go down.

      • Deaconclgi

        Every company has its up and down times. Apple’s phone marketshare was going up and I think they are not going up as they were before. Right now, Android is going up but that does not mean they always will be. Nokia was going up, then down, now up again. You can insert any manufacturer/OS and chart it out and you will see up and down points. I remember our stock (not Nokia) was worth over $20 a share and at our lowest we were at around 29 CENTS a share and begging for bailout money and now the stock is going upwards of $12 a share.

        Ups and downs are given to all. It is what you do and the product you put out is what matters. We americans are very opinionated and not factual. For example, I think that it is a joke and a SHAME that in 2010 you have to hack your way into using an FM Radio on a device. The facts state that other unnamed companies have been making FM radio AND FM Transmitter equipped phones for years….

        Opinionwise in the US, Nokia is junk and doomed. Factually, they are doing better than everyone else overall and increasing marketshare and offer more features, services and devices than anyone. Truth is marketing sways opinion and facts are hardly discussed but that doesn’t give the media the right to feed us opinions that are ignorant of the facts. Apple has hands down the best marketing, factually and by opinion. US opinion wise they have THE best phone but factually they don’t. My thing is buy what works for YOU but also take the time to gather some facts to support your purchase and opinion. Decisions should be made off what a device can or cant do for you and the importance of the feature.

      • Wild Bill

        Deaconclgi….I basically agree with everything you wrote. Especially…..

        “Nokia faces this problem: They design and build devices for world use. The rest of the world isn’t as cheap and carrier restricted as the US. US companies design devices for the US, they will sell them on contract and impose any restrictions, whether manufacturer or carrier and YOU will still buy it for cheap on contract”

        That basically sums it up. You can’t compete on any level unless your product is “out there” where it can be seen. Unless Nokia plays by the same rules that the U.S Carriers impose on EVERY manufacturer that wishes to have their products marketed, subsidized and sold through them, nothing is going to change for them regardless of what they do.

        You won’t have success in the U.S unless your products are sold through a carrier. It’s that simple. And I don’t care if it’s an iPhone, Android, BB or anything else anyone cares to mention.

        It’s the way things are.

      • Deaconclgi

        Exactly. I hope that Nokia realizes that too and begins negotiations with every carrier. Nokia has to give a little to get a little.

  • thebizz

    While I loved my n76 it did alot of things that the us is just getting tether great camera still better than any cell phone camera that I’ve used. The simple fact is the need to get into the us market with us carriers. They have great design and optics but at this point symbian and their processores are behind the curve. Jump in now or throw in the towel. Its due or die time

  • bob

    he’s from Microsoft… if there’s anything he should be an expert on it’s a ’stifling bureaucratic culture’..

    • BChau

      Before Microsoft, Stephen Elop worked for Adobe. Before Adobe, he was the CEO of Macromedia. And one more thing, Stephen Elop is a great leader with great vision and he can execute his plan well.

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