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What UT and Capital Bank Can Learn from Nokia

There is the saying that “if you have never made a mistake or failed, you have never tried anything”. Sometimes no matter the effort you put into your work, things just don’t work out. That was the case of Nokia a few years back. The company had to be acquired by Microsoft because they just couldn’t keep up with change and technology. As a mobile device and telecommunications company, it is imperative that you remain on top of all things technology-related. Nokia failed to do that, and that resulted in it being acquired by Microsoft.

However, Nokia has made a dramatic comeback and is set to challenge its competitors on the market. The issue of Nokia’s comeback is one that is very relevant in Ghanaian conversations; especially at a time when two banks have been taken over by another.

Let’s take a look at the developments that led to the collapse of Nokia. It all began in 2010 when Stephen Elop became CEO of the company. Nokia’s primary Operating System (OS) at the time was Symbian, which was still the dominant mobile OS. However, new CEO Stephen Elop realized Nokia was losing its market shares to rival Operating Systems – Android and iPhone. In an attempt to keep up with the competition, Nokia partnered with Intel to create MeeGo. But in early 2011, Stephen Elop issued the now-famous “Burning platform” memo. He stated in part: 

The battle of devices has now become a war of ecosystems, where ecosystems include not only the hardware and software of the device but developers, applications, e-commerce, advertising, search, social applications, location-based services, unified communications and many other things. Our competitors aren’t taking our market share with devices; they are taking our market share with an entire ecosystem. This means we’re going to have to decide how we either build, catalyze or join an ecosystem.

Nokia has stopped producing the Lumia line of phones

Nokia, therefore, partnered with Microsoft on February 11. Stephen Elop later said that he wanted Nokia to use Windows Phone instead of Android to differentiate the company from its competitors. The first Nokia Windows Phone was the Lumia 800. The Lumia and Asha feature phones increased the company’s market share but didn’t do much for Nokia’s profits.

Finally, in September 2013, Nokia announced it would sell its mobile devices division to Microsoft. The purchase was finalized in April 2014. Nokia was out of business.

Our greatest glory is not in never falling,

but in rising every time we fall – Confucius.

Per its agreement with Microsoft, Nokia was not allowed to sell smartphones with its own brand until the end of 2016. Nokia was also not allowed to sell Nokia feature phones for the next 10 years. But that didn’t stop Nokia from moving to other segments, and just a few days after the purchase was finalized, work began on the Nokia N1 tablet. The N1 was released in January 2015, but there wasn’t any new announcement or release of consumer hardware from Nokia for the rest of the year. Then in 2016, Microsoft decided to sell Nokia’s feature phone business to Foxconn subsidiary FIH Mobile and a Finnish firm called HMD Global.

At the same time, Nokia announced a partnership with HMD Global, which would become the sole licensee of the Nokia brand for phones. This meant HMD would become the only manufacturer of both Nokia feature phones and smart phones.

Nokia missed its chance to adopt the Android platform earlier and is now embracing Google’s operating system and ecosystem at a time when the mobile market is brimming with Chinese players offering affordable handsets with high-end specifications and solid designs. The first Nokia device by HMD was the Nokia 150. In January 2017, the Android-based Nokia 6 was released in China. At Mobile World Congress, HMD revealed the Nokia 5, Nokia 3, and a revamped Nokia 3310.

All Nokia smart phones will be shipped with the latest version of Android OS with guaranteed monthly security updates. These smart phones also feature Google’s recent Google Assistant.

Nokia has made an impressive comeback and is already threatening masters of the market like iPhone and Samsung among others.  Nokia management is confident that the company can bank on its popularity with consumers to set itself as a force to reckon with in terms of mobile and tablet devices’ manufacturing and sales.

So the question is, “Can UT Bank and Capital Bank follow the footsteps of Nokia and make a dramatic comeback into the finance industry?”