How Nokia/S60 Could Break Into The U.S. Market
Nokia struggles to sell its higher-end S60-powered smartphones in the U.S. That’s a fact. Their S40 phones do rather well, and are quite easy for the manufacturer to get featured on AT&T or T-Mobile’s product lineup. They also sell quite well, shown recently by the 6555 on AT&T and the 6133 on T-Mobile. However, the last S60 officially offered by T-mobile was the N90, and AT&T’s was the N75, though it was completely butchered.
The problem, as I’ve mentioned before, is that AT&T doesn’t really ‘get’ S60. Either that, or they completely understand it, but are so stinkin greedy that they refuse to offer something so open. However, since they offer Windows Mobile handsets as well, we’re going to go with the former, that they don’t understand S60 and its benefits to both the consumer and the carrier.
I’ve been thinking long and hard about this, and the announcements of the Samsung G810 and LG KT610 finally helped me to figure out how exactly I think S60 could really break into the U.S. market, or at least give it a killer shot…
A few things to note: Nokia owns S60, but operates it essentially as a separate company, more or less. S60 is also (obviously) licensed out to a few other manufacturers, most notably Samsung and LG. Nokia’s presence sucks in the U.S., that’s plain to see. However, Samsung and LG are both doing remarkably well, particularly with the GSM carriers, AT&T and T-Mobile. AT&T and Nokia have a notoriously terrible relationship. However, both Samsung and LG provided the launch handsets for AT&T’s newest services, including Push-To-Talk, 3G, and in the near future, MobileTV based on MediaFLO. At any given moment there are roughly 5-6 different Samsung or LG models in AT&T’s lineup, and that includes smartphones.
Nokia has managed to get a few S60 handsets onto AT&T’s lineup, typically one every other year. It started with the 6620 (as far back as I remember) and then came the 6682, E62, and now the N75. None have done very well, mostly due to the obvious fact that AT&T has no idea how to market S60, and they’re afraid of its openness, in my opinion. Nokia has been the lone wolf fighting for S60 in the U.S., and I think it’s high time they recruited some help, particularly if they want to get anywhere with AT&T and soon T-Mobile.
If you’ve not put the first paragraph with the second, here’s the general idea: Nokia and S60 need to get together with Samsung and LG and do whatever it takes to convince the two that it would be a good idea to get some S60 handsets on the U.S. carriers. I think if Nokia was able to walk into AT&T’s boardroom flanked by Samsung and LG, all sporting S60 handsets, AT&T might be able to give it a bit more attention and possibly learn how to market the things.
The problem is that every S60 handset manufactured by LG or Samsung, up to this point, have lacked the appropriate GSM frequencies for the U.S., showing that neither vendor is interested. Nokia/S60 is going to have to entice these guys to put up some S60 love for the U.S. Exactly how to do that is the issue. Not to worry, I have two suggestions:
1. The first is obviously to give them a licensing discount on S60. This will cost Nokia/S60 at first, but has some potential to make it back once the trio has made headway in the carrier game with S60. Obviously not the most attractive option, but an option nonetheless. However, Samsung is making Windows Mobile handsets for a reason - they’re obviously being given some sort of incentive by Microsoft to keep doing so. Nokia/S60 needs to figure out what that is, and top it.
2. The second method that I have come up with is to work out some sort of collaboration on something big. Get together and help each other out. Nokia’s dominating every other market on the planet. Surely there’s something that they can share with Samsung and LG, and vice versa, so that S60 can be a bigger event in the U.S. market.
What do you think? Do you think that if Nokia/S60 could use existing relationships to edge into the U.S. market, they’d have a solid chance of making an impact? Personally, I think that the iPhone’s success is largely due to the lack of multimedia features on the other smartphones running Windows Mobile and the Blackberry OS. Palm is about as ‘multimedia’ as a Nokia 1110, so I’m not counting it. I think that with handsets such as the N78 and 6210 Navigator that are lower priced but with plenty of features, Americans would definitely be willing to check out the Symbian S60 OS.
Please note that I still do and will always firmly believe that any and all carrier branding is a detriment to the phone, in every case. However, I also know that sometimes you have to move backwards slightly in order to move forward. Pushing more handsets out in the U.S. with AT&T or T-Mobile branding might suck initially, but the end goal is simply to increase S60’s marketshare in the U.S., regardless of how it’s accomplished.
What about if Nokia just decided to cede the American market, would it be so bad? Perhaps they could back off for a few years and come back for another bash once Windows Mobile is dead and the iPhone has beat the US carriers into submission, or maybe when S60 Touch is ready to roll?
Just a thought, probably not a great thought however! (^_^)
Nice post Ricky.
Ricky,
You’ve missed a few S60 handsets on AT&T, notably the 3650 and the S80 handset that escapes me at the moment…
I really think that AT&T is gunshy about the whole ‘5 firmware upgrades to get a fully functional and fast phone’ that seems to be par for the course with Nokia these days.
And finally… on a sort of tangent, is there any sort of XDA-Developers site for Nokia phones? I love the homebrew ROMs they have there, and they’ve pushed me back to the WinMo side. Hell, those ROMs alone push WinMo into the ‘more open than anything else’ realm.. Nokia sure doesn’t let users cook their own ROMs, do they?
Cingy and AT&T (since back in the day they were seperate of course) have at various times offered the 3650 (in some of the 1900 markets prior to the large 850 rollout), 3620, and 3600 (which is of course the 850 version of the 3650).
Anyway, to the post: I agree largely with everything you’ve said, but would add that one of the biggest deterrents to smartphone adoption in the U.S. is Windows Mobile.
Personally, I don’t like Windows Mobile — my most recent attempt to like it (I try every couple of years) was the HTC TyTN loaded up with WM6. It’s still confusing to use. It’s still slow. It’s still WAY behind on things like browsing.
But you can’t deny it’s name brand appeal. I agree that Windows Mobile is probabaly being shoehorned into every handset on the planet because of Microsoft slashing licensing to the point that it becomes very attractive to Sammy, LG, etc… they’ve done it on the desktop market, and tried it on the server market (with less success, Linux still dominates there), why not the mobile market?
But that’s not even the problem really.
The problem is that when the average American consumer thinks of a smartphone, they think of Windows Mobile (due to the aforementioned brand appeal)… they try Windows Mobile… they see how confusing it is… they give it up. At that point, one of two things happens: either they simply go back to a dumbphone and forget about smartphones altogether, or they buy a blackberry.
Plain and simple, rather than trying to beat out Windows Mobile, at least initially, Nokia needs to position itself so that a.) people understand that it too, like blackberry, is the “other smartphone”, and b.) they can then catch more fallout from those that don’t like WM but still might be interested in a more powerful device then their average dumbphone.
The iPhone is doing just that — besides the horde of salivating nutball Apple fans that bought it, Apple has grabbed a chunk of the market that might have considered a WM phone but decided it was too complicated. Nokia keeps approaching the American market as if they already dominated, like S60 does in Europe, instead of gunning for the number 3 spot then working their way up the chain.
Ahhh, I could ramble forever…
-olly
You forgot the fantastic N-Gage QD as well.
Given that N78 NAM was announced already, I hope that’s a sign of it coming to AT&T. It would be a great break through. I don’t think AT&T has had that bad an experience with N75 (just guessing though) so they may be willing to take the next step. The thing with US carriers is that they have very few higher end devices in their line up at any given time, so competition is fierce..
Olly I don’t agree with your assertion that Windows Mobile is the culprit for s60’s poor takeup.
I think it’s three things -
- Carrier ‘misguided’ decisions - like insisting on the E62, rather than taking on the E61/E61i, both of which have Wi-Fi, for instance …
- Palm Pilot. Every American thinks any sort of PDA is automatically a Palm Pilot. That’s effective branding on Palm’s part, all those years ago. Neither Windows Mobile or S60 have broken that branding legacy.
- Blackberry. If it’s a phone with a keyboard, its a Blackberry to most Americans.
- I’ll throw in Carrier Greed as a sneaky 4th, but only because I was being charitable with the first one (misguided carriers)
I don’t think many in America have not heard of Nokia. I just don’t think those in America who are in the market for a full-blown Smart Phone recognise anything outside of Palm/Blackberry/Windows Mobile as a true smartphone.
Oh - and I’ll add a 5th reason for the slow takeup of S60 - Corporate America. The company I work for supports Push email through MS exchange. But, strangely (to me at least) they insist on using Blackberries. Employees have no choice. Blackberry or nothing. Not even Windows Mobile, which synchs more fully and very easy with Exchange!
Corporate America is wedded to their Blackberries, so there’s no chance of sneaking in S60s unless Nokia an others push REAL HARD and back up that push with devices that wipw the floor with Blackberries, Palm, Win Mo and of course the red herring iPhone!!!
I think olly is partially right in that Nokia seems to approach the US market as if they already dominate it, and they expect people to just start buying their phones as if potential customers know it too. All in all, Nokia phones aren’t any more expensive than other handsets when you buy them off contract at full retail price. I’ve had my share of WinMo devices and truly like them; especially with a QWERTY keyboard. Things like email just become easier in that regard, not to mention document editing in a pinch. I realize Nokia has S60 phones with large displays, however, having a fairly large touch-sensitive screen makes remote accessing a PC or server over VPN much easier. I know that there is software for my Nokia that can do this, but VPN access is native in Windows Mobile as is the Terminal Services client. Granted the TS client isn’t truly great, but it works well.
With all that in mind, I think Nokia can make some in-roads with their upcoming S60 touch interface. The iPhone, in my opinion, simply can’t compare to my E51 as far as features and usability. I think that anyone who knows would choose S60 over Apple’s product more often than not. I don’t think the problem has anything to do with open or closed operating systems. If a carrier sees something that will make them money, they’ll go for it. Nokia just has to show that their phones and S60 can make a carrier money.
I still think something fundamental is being overlooked, and Steve’s blackberry comment nailed it.
Those phones (blackberries, Treos, Blackjacks) *just work*. There are fewer firmware updates to fix memory leaks or address broken functionality than a typical S60 phone. If I were AT&T, I’d be (rightly) afraid of the prospect of users bringing phones back in because they were rushed to market and/or to have a store employee do a firmware update.
And yes, Apple gets away with the same issue… but then again, they’re Apple, and they’ve made the process relatively painless.
To sell smartphones in the US, the old rule was you’ve got to start with the business market and expand into the consumer market. Apple’s turned that rule around, but… they’re Apple.
As for Nokia, the E-Series is hardly business friendly. Most corporate network admins love the BBs, the Treos, and the WM phones because they have an aspect of control over the devices from the server. You can even remotely shut down WM phones if they’re stolen. That’s business friendly.
Nokia is working a lot closer with all the carriers in the U.S. now, though it appears most of the phones being worked on with carriers are of the S40 variety.
The S80 phone in question with Cingular was the Nokia 9300.
The non-carrier channel is slowly starting to open up. Everything I’ve heard suggests that trend will continue. Just because S60 isn’t in the carrier channel doesn’t mean people won’t be able to get S60.
Good read and discussion here. I agree with Ricky, getting to the North American market is going to require carrier support, because that is where the general public makes contact with handsets. The system sucks, but that’s the way it’s been and that’s the way it will be for a long time IMO.
Where I disagree is at&t not understanding series60 obvious capabilities. Nokia and Series60 dominate the global smartphone marketshare, how could they not know what these phones are capable of?
My opinion is that at&t is not an innovator any more, they like to jump on the bandwagon. The old at&t wireless was into innovative handsets (thus the 3650,6620 etc…) but as a larger at&t, they adapt to what the American public wants.
The general consumer wants a cheap, easy to use phone that looks nice, with some multimedia capabilities. RAZR’s, Samsungs and LG’s. Nokia is none of these.(to the general consumer)
Business users want blackberries, Palms and Windows because they were built for business, and they have built a reputation with business.
Nokia fills a niche market with handsets that are “jack of all trades” that can do many things, but cannot master (at least in general) any.
I think they have tried to fill the nice with the e series, specifically the e61/e62, but most consumers contact with the e-series is the e62. Unfortunately the branded version was super slow, and overall one of the worst series 60 phones, so people moved back to blackberries and WinMo!
There are many other smaller factors involved as well, such as the bickering with Qualcomm, Nokia’s resistance to US market trends (flip phones, touchscreen devices etc..) and lack of any real marketing puts Nokia in a bad place here in the US.
This is simple.
When, in an ATT store, you pick up an iPhone, they have everything to say: that it is as easy to use as a Mac (which it is).
When you pick up a Tilt, they wax on about how powerful it is and that it runs Windows - and all the powerful work-ish capability things that implies.
When you look at an S60 device. The sales people have nothing to say. They don’t know anything about it.
So the issues is what it has been since the Psion days: no f*#)*&g branding.
Retail sales people don’t sell. They bank (ricochet) off of what you think you know as a consumer…and, simply, “it’s as easy as a Mac’” or “it’s as powerful as your PC,” is all it generally takes.
Symbian will never make it in the USA because there is no cachet to the brand, there is no reference point for the brand and there are not enough resources to sufficiently train and incent the people who sell to the “great unwashed” that is are carrier’s main customer demographic.
Period. End of story.
Richard, I think you’re spot on. My next question, then, is HOW would you suggest they create that cachet?
This is what I mean by the statement that AT&T doesn’t ‘get’ S60. To them it looks like a featurephone, so that’s how they market it. However, it’s clearly NOT a featurephone, and thus sales blow.
I think it’s just a matter of picking the right device. They should offer high end S60 devices like the N95 or the E90. The N75 didn’t do well (it’s not even available anymore) because it had too many problems, mainly with the battery, if I’m not mistaken. And the features it had weren’t good enough to “offset” the problems.
Unlocked, and priced in the range of $600~$700, the N95-1 sold around 400k units in the US. With ATT backing it up and with a price of $299 (like the Tilt) I can’t even imagine how much the N95-3 would have sold.
Just adding to my last post, ATT should market the N95-3 (or the N95-4) as “do-it-all monster” that it is. It would sell like cupcakes. Their top of the line do-it-all smartphone/ppc, the Tilt, is selling pretty well.
I own both and the N95 owns the Tilt in almost every aspect (except for the qwerty and the GPS, which is a lot better on the Tilt). The ocnsumer isn’t that stupid. Give him a good product and they will buy it. Show him that nice 5 megapixel camera, show him that flawless video playback, show him that “DVD quality” video recording. If you offer it they will buy it.
Well, I live far away from the US so I can’t say that my idea is actually realistic, but hey, here goes…
Nokia advertising/marketing inside carriers’ sales points. Have a Nokia ‘desk’ where a Nokia ‘genius’ (nice reference, huh?) can explain stuff about the phones. Oh, and get a TV, a CD-player, a digital camcorder, a laptop, etc., inside glass box. Then put an N95-3,-4 or N96 on top (or wherever) of that and CLEARLY say: this IS all of those.
Or if this isn’t possible in the operators’ stores (I am not talking Nokia Flagship stores, those are way too few for now), at least advertise this way. Place huge ads all across the big cities, on TV, etc. But simple ads. Nokia need to simplify their ads a LOT if they want to count on the US market (yes, looking at Apple for comparison is good here).
I hope this made some sense.
Guru,
I am a guy who takes on incredibly long odds: things that no one has done, I do (in the marketing world, that is).
It cannot be done with Symbian…or S60…or UIQ. None of them exist in the mega-brand world.
There is one, slim chance. It would be expensive, it would pay off, it would be fun. But Finland would have to call.
Technically speaking, Nokia doesn’t own S60 and run it as a different company. They own Symbian and run it as a “separate” company. They also own the S60 and Series60 names, but S60 or Series60 are by no means companies.
You say Nokia’s presence sucks in the U.S. when you had just said S40 phones do rather well, which I agree with. And I don’t think you meant to say S60, because you compared it to the presence of Samsung and LG, neither of which has a huge presence when it comes to smartphones (leave that to HTC); certainly not LG. Most Americans agree Nokia makes excellent handsets featuring the best build, RF and voice quality you can get, so I think Nokia’s presence here is quite good, although not nearly as good as in other places of the world; Europe, for example.
You keep contradicting yourself when you say the solution is to have Samsung and/or LG sell S60 phones instead of Nokia because… er… AT&T doesn’t get or know how to market S60? So how will AT&T get or sell S60 correctly just because it comes in a package labeled Samsung or LG?
I personally feel S60 does not and will not sell in the U.S. in its current form nearly as much as it sells in Europe, because it wasn’t designed for the U.S. market to begin with, no matter who implements it in their devices. Its basic philosophy doesn’t target the American consumer and his needs when it comes to cellular phones. In fact, the platform is getting quite old, even for the European folk. And the fact that America is [finally] biting into the smarphone craze (let’s admit it, thanks to Windows Mobile) and that the iPhone has raised the bar in many fields (most UI-related), makes it a perfect opportunity for Nokia to come out with an all new S60 or whatever they want to call it next. And what do they do? S60 Touch, which is nothing but S60 with a touchscreen. Certainly falling short here, aren’t we, Nokia?
Nokia needs to analize everything that made the iPhone an instant hit in the U.S. to finally understand the American market, they need to see how Microsoft is finally reaching the mobile professional with their O/S. And then outdo them both with a killer, all new user interface, multitasking, best in industry multimedia capabilities, the oh-so-popular-now blogging, chatting and social networking features, that openness you talk about and all the good things we’ve come to love from Nokia.
Only Nokia can make the American market aware of what Nokia can offer them. Not AT&T, not Samsung, not LG. Having another phone maker sell S60 will not make John Doe realize what a great O/S Symbian really is.
Actually, Razor1973, According to wikipedia: http://en.wikipedia.org/wiki/S60_platform Nokia does indeed own S60 and licenses it out to other manufacturers, such as Samsung and LG. They also do NOT own Symbian, though they are a large stakeholder, they are not owners by far. Sony Ericsson and Motorola are both large stakeholders in Symbian, hence the UIQ platform (which is owned jointly by SE and Motorola).
Nokia’s S60 presence sucks in the U.S. Samsung certainly has a large presence, specially in smartphones with its wildly popular Blackjack handset. Also, I merely pointed out that both Samsung and LG have 2 things: 1. large presence in the US (smartphone or not) and 2. history (albeit small) of manufacturing S60 handsets.
The whole point is that alot of the reason that AT&T doesn’t like S60 is because they don’t like Nokia, and Nokia is currently the only one pushing S60 in the U.S. With Samsung and LG, both of whom have tremendous carrier relationships, helping to push S60, they could convince AT&T of its benefits and sellability.
Furthermore, I don’t quite know how you think that S60 doesn’t ‘cater to’ the U.S. market when other multimedia-based handsets, such as the iPhone, rock it. That’s what S60 is, basically. It does multimedia better than any Smartphone OS on the planet (depending on whether or not you count the iPhone as a ’smartphone’, and even then, overall, including imaging, S60 spanks the iPhone, but that’s another conversation). Otherwise, please inform me what S60 is ‘at its core.’
You can read my thoughts on S60’s Touch here: http://www.smstextnews.com/2008/02/why_nokias_s60_touch_demo_sucked.html.
Personally, I feel that it would be an incredible mistake for Nokia to just copy the iPhone. That would be a horrible thing.
The point of the article is that if Nokia is licensing S60 to other handset manufacturers, why shouldn’t they bring Samsung and LG on board for a ‘challenging’ market such as the U.S.?
Guru, I didn’t say Nokia didn’t own S60. I said “Nokia doesn’t own S60 and run it as a separate company”, since S60 is not a company. Symbian is. In fact, I said Nokia does own S60; the S60 name. But you’re right in that Nokia doesn’t fully own Symbian, although their share of the company is so large at almost 50% that you might as well call it ownership.
Now, you did not say Nokia’s S60 presence sucks in the U.S. You said, and I quote, “Nokia’s presence sucks in the U.S.”, which is why I had to point out that you had mentioned the opposite just before (”Their S40 phones do rather well”). Granted, this is a site about Symbian, so maybe you did mean S60 after all.
But, regardless of these technicalities, I don’t agree with the bigger picture of your rant. If I understand it correctly you mention two factors that could contribute to S60 not hitting it big in America. (1) AT&T doesn’t get or know how to sell S60, and (2) AT&T and Nokia don’t get along.
Your suggestion is that another phone maker sells S60 here, but that would certainly not solve point (1), as it would be the same O/S (technically the same UI). And if the problem really is the relationship between AT&T and Nokia as companies, not technology (point 2), then why “Their S40 phones do rather well, and are quite easy for the manufacturer to get featured on AT&T. They also sell quite well, shown recently by the 6555 on AT&T”? That’s the same Nokia that makes S60 phones, so it’s not the company either.
Really, I don’t think either of these factors play the slightest role in S60’s lack of popularity in the U.S., but the O/S itself. We can’t blame AT&T for not “getting it” or not getting along with Nokia. It’s really Nokia who’s to “blame” here.
And I am by no means saying Nokia should copy the iPhone. Yes, that would be a horrible thing indeed. I said learn from the iPhone and what made it a hit in America. And then keep the same principle and implement their own solution and outdo Apple.
The American consumer seems to favor coolness above anything else. Form over function. Their devices need not do many things, but do those few ones in a very cool fashion. They need the wow. They need the oomph. And this most likely stems from the alienation we suffer in this country and the need to stand out and be seen. But, regardless, it’s what we crave. (And, even though I do say “we”, I wouldn’t include myself in that stereotype.) And this is probably also the reason blogging, chatting and social networking sites are becoming so hip right now, since people are looking for that “human” contact we’ve lost. And Nokia needs to see this and exploit it in their next platform. S60 Touch isn’t it. The iPhone hit the nail right on the head. (No, I don’t or would own one.)