Days ago, Nokia CEO gave a hint of Nokia Android phone in an interview with El Pais. Although that's a misunderstanding, no one can make sure that Nokia won’t make Android phones in the future. Let’s just imagine what will happen if Nokia Joins Android phone.
Low profit ration, price war
Revenue of Nokia is mainly from phone, maps and Nokia Siemens. In Q3 of 2012, revenue from phone and Nokia Siemens is almost same, as 3.5 billion euro. And just 0.265 billion euro from maps which can be ignored.
Nokia Siemens was in the red since it was established in 2006. Until Q3 2012, Nokia Siemens made its first profits about 0.128 billion euro. In the low profit period of telecom equipment, Nokia Siemens can’t be expected too much. And then, phone becomes the only hope for Nokia.
Actually, revenue from Smartphone is about 27% of total revenue of Nokia. phone And most of them is from cheap feature phone, while its market share is being ate. If Nokia joins Android, higher R&D expenditure is necessary, along with fierce competition in Android camp and low profit, Nokia has to be competitive in price. But instead, only high profit ration can support Nokia to move on. Samsung has relatively complete industry chain to support them. In that case, what Nokia can depend on? So, Nokia has to face low profit ration and even price war.
Mid and low-end market impacted
From another perspective, makers in mid and low-end market should be the most worried. Once Nokia joins Android, the best strategy for Nokia is to stay in high-end market by Windows Phone, and gain the market share which is lost in feature phone market by Android phone. As a new-comer, it’s not easy for Nokia to compete with Samsung in high-end market. But Nokia can still gain market share in mid and low-end market by its solid quality and brand. Especially in China, Nokia still has its rich soil.
WP is frustrated, Microsoft-branded WP
So far, only four main makers in Windows Phone: Nokia, HTC, Samsung and Huawei. HTC, the other closed partner of Microsoft besides Nokia still put their focus on Android, who just announced HTC butterfly last month. Samsung, of course, will continue to make Galaxy phones since its great success in 2012. For Huawei, who just released a low-end Windows Phone in CES. And it seems that Nokia becomes another name of Windows Phone. If Nokia joins Android, although it can’t prove a failure for Windows Phone, Windows Phone can’t help Nokia to resurge at least. For users and makers, Windows Phone may not seem so successful. And at that time, Microsoft probably bring out self-branded Windows Phone to strength Windows Phone ecosystem.
General speaking, Nokia who has more than hundred years history ever made contributiion to the society development, no one want to see its end. But can the Windows Phone really be Nokia saver?