New Lumia phones, Last chance for Nokia

"The N95 was the last great phone Nokiamade," says Dhruv Bhutani, a technology blogger and a Nokia enthusiast, as he recalls the Finnish company's glory days.

Since he fell in love with N95 in 2007, Bhutani never used a non-Nokia device as his primary phone. That was until 2011, when he decided to give iPhone 4S a chance. He used it for several months and realized it was difficult to part ways with the Apple's phone.
"Nokia made many smartphones after N95. Some good, some average and some marred by glitches. None of them came close to N95 in terms of polish, hardware and user experience," says Bhutani. "But there is one phone that is as great as N95. The one made by Apple. I find iPhone 4S a complete package, the way great Nokia phones used to be."

Bhutani is not the only Nokia enthusiast to feel this way. As the company's phones took a beating from iPhone and Android devices, many Nokia loyalists — and India is full of them — have started doubting if the company can come back from the brink.

"Nokia seems to be trying hard but its best always seem to fall short. The world has changed," says Bhutani. But just like thousands of other disappointed Nokia enthusiasts, Bhutani is looking forward to Lumia 920, the flagship smartphone that the company announced on September 5. Though he has found iPhones to be very good, he is ready to choose the new Lumia over iPhone 5, the greatest and latest from Apple.

"Lumia 920 is a phone that can be the new N95. It can be perfect," he says.

The last chance
For analysts there is no question of 'can' here. They say Lumia 920 and Lumia 820 that are powered by Windows Phone 8 'have' to be perfect.

"If the new Lumia phones fail, it is going to be devastating for Nokia. It is really their last chance to get back into the game. If they blow this up or if it doesn't work out, it is going to be too late for them to come back convincingly," says Anshul Gupta, principal research analyst with Gartner.

The problem for Nokia is that so far its attempts to turn things around have yielded little result. Patrick Moorhead, president and founder of research firm Moor Insights and Strategy, believes Nokia made two crucial mistakes in the past.

"Nokia missed two major inflection points, apps and touch. While the Symbian OS had some of the first apps, Nokia didn't invest to make it a massive ecosystem with easy to use tools. It also ignored the touchscreen at a time when Apple and Google bet everything on a high quality, capacitive touch-first environment," says Moorhead.

Nokia realized its mistake a few years ago but by that time iPhone and Android juggernauts were rolling and gathering pace.

In the early 2011, Nokia CEO Stephen Elop wrote a candid memo to his employees. "Nokia, our platform is burning," he wrote, citing the example of a man who found his ship burning and had to jump in icy cold water. "The burning platform, upon which the man found himself, caused the man to shift his behaviour, and take a bold and brave step into an uncertain future... Now, we have a great opportunity to do the same."

And true to the story, Nokia took a bold step. It decided to jump from 'Symbian the Burning Platform' and selected Microsoft's Windows Phone as the OS for its future phones in the early 2011. It was a jump in the icy cold water.

The partnership bore its first fruit in October 2011 when Nokia announced Lumia 800 and Lumia 710. While the phones looked good on the paper, they were not very well received by buyers despite a marketing blitz that saw Nokia spending millions of dollars. Lumia 920 and Lumia 820 too look good on paper. But for now analysts are wary of terming them Nokia's saviours.

Gupta believes that the new Lumia phones are flagship devices and they are going to change little for Nokia. "They will sell in limited quantities. High-end phones are one part of the story. Nokia also needs killer devices with a price of around $150 that can help it in markets like India and China," he says.

Moorhead is cautiously optimistic. "The new Lumia phones have many distinctive features that set them apart from iPhones and Android-based phones. These are features like very high-performing PureView cameras, NFC for simpler pairing with connected devices, ceramic exterior, and flashy colors. But most of Nokia's success is governed by the acceptance of Windows Phone 8. If Windows Phone is accepted, the higher likelihood Nokia will do well and vice-versa," he says.

All eyes on Windows Phone 8
One of the reasons why the earlier Lumia phones failed to take off was Windows Phone 7.5, the OS that powered them. Bhutani believes that even though it is a beautiful OS with a fresh user interface, it lacks too many important features like Bluetooth file sharing or mass storage mode to be truly useful.

Though Microsoft is yet to reveal details of Windows Phone 8, it seems that most of these issues have been taken care of in the new OS that powers Lumia 920 and Lumia 820. Peter Bright, who covers Microsoft for Arstechnica, a popular technology websites, believes Windows Phone 8 can match Android or iOS, which powers iPhone.

"I think WP is a good platform with an ecosystem that is far stronger than its market share would imply. I think it will survive for at least as long as Microsoft feels threatened by the growth of the smartphone, but it may never prosper," says Bright.

Gupta agrees. "As an OS Windows Phone is nice. There is nothing wrong with it. Gartner has predicted that it can be the second top mobile phone OS by 2016 so obviously we see lot of potential and merit in it," he says.

The problem for Nokia is that even though it finally has a viable OS with which it can build its phones, the competition is very strong. "Nokia needs a way to punch through the clutter of the rest of the market. They do have some very distinguishing features but they need something groundbreaking and exclusive. The answer lies somewhere with a connection between Windows 8 for PC and tablets and Windows Phone 8," says Moorhead.

So far, no one outside Nokia or Microsoft clearly know what sort of connection Windows devices are going to share. But the consensus on future seems clear. All depends on new Lumias.

"If Nokia's new phones don't do well in the marketplace, they should start preparing themselves to be a much smaller company focused on lower priced phones. Alternatively, they could prepare themselves for a sale to either Microsoft who must be successful in phones, Sony who needs more innovation, or a Chinese brand like Huawei or ZTE who need a western brand and the highest quality phone," says Moorhead.

In Elop's memo, the man who jumped from the ship survived and lived long enough to tell his tale. "He was able to tell his story," wrote Elop. Nearly 18 months after the company jumped from the burning platform, Nokia is still swimming in icy waters.