Former Microsoft Executive, current Nokia CEO, and soon-to-be Microsoft Executive, Stephen Elop, has been making a lot of news lately – and most of it is not good news. When Elop arrived at Nokia he brought his “Windows” mindset with him and signed a two-year deal with Microsoft to produce their Lumia smartphone line using only the Windows Phone platform, rather than the more popular Android OS. By committing Nokia to what was basically only a niche operating system, they were limited in sales potential from the very beginning. The once pride of Finland, Nokia, continued their downward spiral under Elop’s direction and in May had come under fire by Nokia’s shareholders demanding that Elop “switch to another road.”
The problem was that Elop’s allegiance was always toward Micro$oft and he brought that loyalty with him to his new found job as Nokia’s CEO. By “destroying” Nokia from within, Elop allowed his old company, Microsoft, to buy them out for less money as Nokia’s value continued to slide. Elop gets a nice fat bonus, a new executive job with his old company, with a real shot at becoming their next CEO when Steve Ballmer retires in a few months, and Microsoft ends up with Nokia – an earlier article we wrote describes it as Microsoft planting their “trojan horse” in Nokia.
This is as much about Nokia’s board not willing to act and force Elop to do the right thing, and even though the stock prices had fallen, the company was worth much more than the $7.2 billion Microsoft paid for Nokia. Nokia even had Android running on test devices, almost as if Elop was humoring them, as late as January, he said, “anything is possible” when it comes to Android devices. The next month he pretty much took Android out of the picture, claiming that it was an already crowded market and Samsung was too dominant a force – so instead he stuck with a platform that was barely alive rather than jumping into the popular Android field.
Next up on Elop’s plate was an impending divorce and Nokia’s plea to take a smaller bonus with his departure, but Elop told the board that he needed the full $25 million to pay for his divorce because he could not talk his wife into taking less money! The hiring of Elop, the downward spiral of Nokia, the selling of Nokia, Elop’s rehiring by his former employer, and now the divorce and bonus scandal is more than the Finnish media could handle and they began to question Nokia.
Nokia finally entered the tablet world with the new Nokia 2520, running Windows 8.1 RT and so far it is garnering good reviews. They also came out with their first phablet, the Nokia Lumia 1520, with a 6-inch display to go up against the Samsung Galaxy Note 3. But with all of this going on as Microsoft gets set to swallow up Nokia, Elop is now hinting that the Nokia name may be dropped from use – what remains of the Nokia company owns the rights to the name, which Microsoft is able to use for ten years according to their agreement. However, according to The Telegraph, it was licensed to use on their low-end Asha line of phones, sold only to the developing countries. When they asked Elop about Microsoft keeping the Nokia name:
Speaking to the Telegraph in Abu Dhabi, Elop said that a decision would have to be made as a “combined company” about smartphone branding once the transaction is complete, but that “Lumia” was a possibility.What we have to decide is what the brand will be. Because we have not decided what brand will be dominant for smartphones, that’s work that’s still ahead. And of course the way we’ll go through that process is to assess with consumers what they respond most positively to, what conveys the best message and the best hopes of success. Microsoft as a company, of course, has many brands: Xbox, Office, Surface and a variety of others. We have brands like Lumia. So we’ll need to decide what the next step is from a branding perspective.
Spoken like a true “politician;” it sounds like Microsoft will just swallow the Nokia name and brand their phones, Lumia. It will be a sad ending to a once proud and prosperous company, and much like BlackBerry, their board and executives refused to keep up with change in the everchanging technical world of smartphones. Once you react too slowly, you can find your company being bought up by the competition, and sometimes sold out by those within.