Why Nokia and Sony Ericsson are failing

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scaled090724_1aFosfor posted an incredible look at what has befallen phone manufacturers and why they’re all faltering. Mikael headed over to Nokia and Sony Ericsson’s sites and tried to list all of the models available. Nokia had 44 and S-E had 70. He then points out that there are three iPhones at best and in reality there are only two.

It costs money to manufacture and sell things. While many of the phones on Nokia’s site may be out of production, they still show them to users as if they were available. This is wrong-headed and ridiculous.

The manufacturers will complain that carriers make them offer so many phones. Carrier A wants a cheap phone to sell to grandmas in Latvia while Carrier B wants a fancy phone to sell to the rich in South Africa. Cry me a river. Are we really that neophiliac that every country and every carrier has to have something a little different? Do we really have to bend our desires to what companies that essentially sell the transmission of bits over radio waves want?

I’m reminded of something I heard when I was interning at Bloomberg news back at the turn of the century (2000, actually.) We were in an intern meeting with one of the managing editors and we were supposed to ask questions. One intern, bright and fresh from an Ivy league school, raised his hand and asked what Bloomberg is doing to get terminals to developing nations. The editor said: “If they buy the terminal and pay the monthly fee, we’ll send them one.” There wasn’t a dilution of brand. There wasn’t any expectation that a business that needed a Bloomberg terminal in China was different than a business that needed a terminal in the UK. There is no such thing as a lower-end Bloomberg machine, no Bloomberg Lite.

Brand dilution is what is killing Nokia and what killed Sony Ericsson. S-E had some great phones but they couldn’t escape entropy. Nokia is still high on the hog but their N-series, the phones that should be making them the most money, is roundly dismissed as out of date.

I understand their hands are mostly tied but when carriers squander your business opportunities for frivolous reasons, something needs to change. Noone cares about 44 phones. They care about the one in their pocket. Figure out why its there.

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