Foundering Nokia pushes 10,000 bods, 3 veeps overboard
Google, Apple peer through periscope torpedo sights
Nokia will shed another 10,000 staff by the end of next year, and has shuffled its VP pack in the ongoing struggle to make money against increasing competition.
It's not just the workers getting the boot this time around, three existing vice presidents are "stepping down ... to pursue other opportunities outside of Nokia", and the whole Vertu operation (luxury phones for the obscenely rich) is being flogged off to a private equity fund. But there's still cash to buy up imaging-experts Scalado, and pay redundancy to those 10,000 workers too.
The VP shuffling puts Juha Putkiranta into operations, from supply chain, Timo Toikkanen into mobile phones from special projects, Chris Weber into marketing from markets, and Susan Sheehan found a seat covering communications. Still standing when the music stopped were Jerri DeVard (Marketing), Mary McDowell (Mobile Phones) and Niklas Savander (Markets), though they'll be hanging around as "senior advisors" during the transition.
Nokia isn't saying where the 10,000 staff who'll be losing their jobs will come from. Talking about the revised focus, CEO Steven Elop would only say: "We intend to pursue an even more focused effort on the Lumia," which sounds like a smartphone strategy... until one gets further down the same release and discovers that "Nokia aims to further develop its Series 40 and 30 devices, and invest in key feature phone technologies".
There will be increased focus, we're told, on location-based services and attempts to get the price of the Lumia down with "new materials, new technologies" but one would imagine that happening anyway. So basically Nokia is going to continue doing the same things it's already doing, only with 10,000 fewer people and a different executive team, and without the facilities in Ulm, Germany, and Burnaby, Canada and without the manufacturing site in Salo, Finland (although R&R will remain in Salo).
The changes are promoted by poor sales, or as Nokia puts it:
[C]ompetitive industry dynamics are negatively affecting the Smart Devices business unit to a somewhat greater extent than previously expected.
And it gets worse:
Nokia expects competitive industry dynamics to continue to negatively impact Devices & Services in the third quarter 2012.
Cutting costs is all very well, and laying off 10,000 people should reduce running costs even if it will take a lump of cash to do, but reducing costs doesn't address the "competitive industry dynamics" that are hurting Nokia so badly. Hopefully we'll see some action on that side of things before it's too late. ®
Re: What new direction?
Your breakdown is nonsense.
There were no problems with symbian and maemo/meego were coming along nicely. The 'new direction' they needed was to get some UI design folks on board, and fire half the management. Cut the number of models down from the hundreds of similar-but-not-equal handsets they were chucking out and get all the engineers pulling in the same direction instead of competing internally on hundred of different teams. Nokia wasn't one company at that point, it was about 8.
By ditching what was at the time the world's leading smartphone OS for one from a company with a history of failing in this arena, they simply torpedo'd existing business and pinned their entire future to a lame donkey.
They're making the wrong one redundant
title says it all....
Backed the wrong horse - WP is too late and too limited.
Maemo/Meego had rough edges, but were better, more polished and had more features than WP.
sounding the death knell for Symbian they way they did was the second single worse mistake Nokia made. The first was Elop himself!
Re: They're making the wrong one redundant
What's being a dick about it?
It was obvious that WP was a terrible move from the get go - an extremely late entrant to the market from a company with a history of failed consumer electronics products and shafting business partners. The Xbox does indeed stand out as a counter example, but I'll see your Xbox and raise you a Zoon.
New direction was needed, yes. But even a muppet could see that it was a bad choice, foisted on them by Microsoft's new man at the top.