Tuesday, August 25, 2009

Nokia netbook nonsense

After proclaiming for a decade that smartphones will inevitably rule the world, on Monday Nokia announced the Nokia Booklet 3G, a high-end netbook that runs Windows.

To avoid allowing Windows Mobile get established in cellphones, Nokia created and nurtured Symbian for more than a decade. Now it’s becoming one of the last firms to adopt Windows, at a time when PC makers (like Dell) are adopting Linux-based Android smartphones, while other PC makers are considering ARM-based (rather than Intel-based) devices.

While I’ve noted that the netbook niche is growing rapidly, I don’t see how Nokia hopes to achieve any meaningful market share. Perhaps there will be a good 3G radio in its netbook, but HP, Dell, Lenova, Toshiba, Sony and others can buy such radios on the open market. (We call this open innovation).

I don’t see how Nokia will have an advantage on scale, innovation, features, branding or distribution over existing netbook makers like Asus, and Acer or the PC followers such as HP, Dell, Sony etc. etc.

It’s not that I doubt Nokia’s capabilities — although using software off the shelf will help it provide greater functionality than its current mobile devices.

However, I can’t see how being late to market in a commodity market is going to turn out well. The choices are low cost or differentiation. The former seems less likely, since it hasn’t been a low cost producer and it seems unlikely to happen any time soon.

Update 8am: However, based on the comments of reader Naru (below), it’s quite possible that Nokia is selling the product as a defensive measure to keep existing netbook producers from gaining a toehold among the network operators and their distribution channel.

Has Nokia has produced innovative phone hardware? Sure, but so have the Korean companies — and they also make PCs.

Meanwhile, the Taiwanese leaders seem to be keeping their lead producing low cost implementations of commodity netbooks. So far, there hasn’t been a lot of volume in the differentiated offerings, and perhaps there won’t be until the new Apple tablet comes along.


Naru's musings said...

There is little doubt in my mind that the 3G powered netbook is a product of the future. I see operators subsidizing the same, in an effort to bring in new users into the mobile fold. the value added services offered by the HW mfg (in this case Nokia) can make a big difference.
I am somewhat more optimistic even if the 1st round goes a bit amiss. Your point though is valid. They need to spell out a clear differentiation.

Joel West said...


That's a reasonable argument — that operators are going to sell these things, and so this is a defensive product to keep competitors from getting too much of a toehold with the operators.

I should have thought of that. Thanks for sharing.


Joy Reed said...

It looks very sleek, I hope it performs as good as it looks.