Nokia’s history: how the company grew into a market leader and lost everything
Incredibly, even 10 years ago, Nokia was the undisputed leader in the mobile phone market. However, now Nokia’s history is perceived differently. It can serve as an example of two extremes: how to become synonymous with the word “cellular” and how to lose everything without noticing the trend of the rapidly developing market in time.
Nokia’s history: from papermaking to power tools
Nokia got its name from the eponymous river, on the bank of which there was a pulp and paper production. Fredrik Idestam and Leopold Mehelin owned them. They laid the foundation of the legendary company in 1865.
At the end of the XIX century Idestam went out of business. Then Mechelin decided to turn his gaze to new markets by rebuilding Nokia for power generation.
Business went well, so in 1922 the company passed under the wing of the Finnish Rubber Works engaged in the production of rubber products. Therefore, boots, gas masks and other things began to be produced under the Finnish brand.
Entry into the telecommunications market
Nokia found its market in the mid-60s. Together with Salora, Finns began working on radio technologies. In the 70s, partners introduced DX200 switch for automatic telephone exchanges – one of the first Nokia telecommunications products.
In 1979, Nokia and Salora merged and became Mobira. Six years later, Nokia bought out a share of Salora and acquired the rights to the Mobira brand.
The new company develops rapidly. In the early 80s, Nokia released one of the first portable phones. Although the Mobira Talkman was rather a massive communication station weighing almost 5 kg, but for those times, it was a breakthrough.
Nokia consolidated success in 3 years. In 1987, the Finnish company showed a device that its shape was more like a mobile phone. Nokia Cityman weighed 750 grams, but it was placed in one hand.
Another height was cleared in 1992. By that time, ARP communication network was outdated, it was replaced by GSM. Nokia instantly responded to the change in the market by releasing its first GSM phone. Nokia 1011 still contained an antenna, but the form and design was quite modern (as for the early 90s) phone.
Meanwhile, until the “golden age” Nokia has remained for 4 years.
Nokia’s history at the time of heyday
The 90s largely determined the leadership of Nokia in its market. At that time, the company received the famous Connecting People slogan; created a phone with a recognizable Nokia Tune ringtone (Nokia 2100) sold 20 million pieces worldwide.
Already in the late 90s, the Finnish company became number 1 among the manufacturers of mobile phones. Its market share reached 40%. Such figures nowadays seem fantastic. For example, in the first quarter of 2018, the share of the current leaders, Samsung and Apple, was 20.5% and 14%, respectively.
The breakthrough models led the company to such heights. The Nokia 7110 supported WAP Internet, and the 9210 had a color screen.
8110 is the same phone that Neo used in the film The Matrix, and the other notable model was 7650. This was the first Nokia smartphone that also had a camera.
7650 worked on the basis of Symbian OS. Excessive hopes for this operating system will ultimately lead the company to crash.
But in the early 2000s this was far away. Then Nokia increased its presence in the market, releasing models that are truly legendary now: indestructible phone-meme 3310, Nokia N-Gage QD gaming smartphone, due to which schoolchildren forgot about their studies, “ladies” Nokia M2 and 7600, 1100 with flashlight and elastic keyboard and other devices.
At some point, it seemed that Nokia’s position was unshakable. However, the company itself became the creator of its failure.
Fatal error of development as the beginning of crash
In 2006, Nokia’s history turned radically – the company released another breakthrough model N73. It was the first Finnish smartphone with 3G support and a front-facing camera.
At the same time, Apple began to prepare for the release of your phone. The iPhone was presented with furor in 2008, but Nokia did not give special attention to the success of Americans. The company responded with the touch model 5800 XpressMusic, which in the end could not become a competitor to the iPhone.
Then Nokia made a fatal mistake, focusing on the development of the Symbian system, refusing to create Android phones. Now these devices are the only competitors of Apple with its iOS operating system.
Finally, the Finnish company lost the battle for the market in 2010, when Stephen Elop previously worked at Microsoft, took over as Executive Director. Over time, Nokia began to produce models on the Windows Phone platform, but they, as it is known now, also did not become successful (Lumia 800 and other failures).
Already in 2013, the market share of the once-leading company was 3%. In the same year, Windows swallowed the firm, thus completing its path.
Nokia’s history shows that even a company from such a seemingly small country as Finland can be a leader in its segment. However, at the same time, its lamentable outcome was an ideal illustration of how quickly things are changing in the IT market. As Kodak did not manage to make progress in the field of phototechnologies in due time, Nokia was not able to clearly react to the emergence of innovative developments from a competitor Apple.