Nokia's internal presentation after iPhone was launched (2007) [pdf]

People blame Stephen Elop. But the person in control of the Nokia board was former CEO Jorma Ollila who headed Nokia through its glory days and had a lot of power. Nothing happened in Nokia without his approval during that period.

The board recruited and invited Stephen Elop. Part of his appointment was the board handing over the company on a silver platter to the new CEO. Negotiations for the acquisition started almost right away in secret. And most likely there were high level discussions ongoing with Microsoft and Steve Ballmer before Elop's appointment.

Jorma Ollila retired as a CEO around 2006; he wasn't really pushed out and Nokia was still performing well. He handed the keys to the company to a non technical CEO with a financial background (Olli-Pekka Kallasvuo, aka, OPK internally). That was the first mistake. OPK was a bit hands off throughout the Iphone and Android rollout. There was no vision, no leadership, just a lot of infighting between heads of various units.

The second mistake was selling out to Microsoft and all the share value implosion that came with that. Microsoft bought several companies over the years. Nokia was one of the smaller ones. That's how bad it had gotten. At the peak Nokia was worth 150 billion or so. MS bought the phone unit for 5 billion. The later Linkedin and Github acquisitions were worth more.

By the time Stephen Elop was brought in (by the board, headed by Ollila) to fix things, it was too late. There were a lot of internal battles as well between the big business units. A whole string of CTOs with no power whatsoever that were appointed and let go. Including Scott McNealy who never really made any impact and was there only briefly.

Was this around the time Microsoft kept switching what "windows phone" was? I remember that the one friend who got into it loved it, and then they released something completely incompatible and he abandoned the platform.

I couldn't believe my eyes when I read that they had hired Elop and was concentrating on Windows phones. I immediately knew that was the end. Unbelievably incompetent by the board.

Nokia was dead company walking before Stephen Elop. Elop saw the writing on the wall and made one of the choices available. A different CEO would have made a different choice but ultimately at that point it would still have been too late to save Nokia.

Nokia was a great hardware company that missed the boat when the market changed to be based around software. When the market changed again to be based around ecosystems, Nokia was beyond saving.

I think the critical failure of the windows phone was that app development was not open. You can't compete with established walled gardens by building your own, you can only compete if you make a huge amazing park free to use just outside the walls of the competitors.

Translating this to windows phones, it would have only succeeded if it either:

1) Made browser applications first-class and pushed phone-specific APIs (gyro, bluetooth, etc) to be open. Then pick a fight with google and apple about supporting PWAs better. This would probably keep windows phones as a "low cost, crappy feeling" systems forever.

2) Made the windows phone native-apps trivial to port to run on browsers with a convenient and easy way to deploy those apps on ios/android (hopefully without feeling too much not-native on those platforms). Would require a lot more engineering resources and time, so much harder to pull off.

Now I can't find that poem about Elop sinking the Nokia ship or something like that.

Do not let the saboteurs in...

Ballmer, the person who pushed for and created the entire Microsoft Enterprise focus, is not an idea guy that understood what made Microsoft successful? This idea that Ballmer was some goof when he was actually considered a co-founder by Bill Gates which is why he received like 17% of the company when he joined.

Also, they put plenty of effort into getting developers to onboard windows phone. They even created multiple platforms that allowed devs to create a single app that worked across all windows devices(pc, phone, xbox) but developers decided, with some very influential devs being extremely vocal, that is was some sort of power grab to force devs to only deliver their software through the windows store.

Wasn’t it already too late by the time Ballmer left?

The follow up N9 was that. It was great. Elop canned it.

I had to import one from Australia. It was totally worth it.

I loved my N810, but Maemo had so many little issues all over the place, it was reaching "Death by a thousand papercuts" territory. iPhone did what Apple used to do so well, which was obsess about the user experience.

I second that ! compact, unbreakable screen, real sliding keyboard with backlight, beautiful interface, true debian, a total shame, I regret it everyday. It was almost perfect. Tons of apps, even Waze! Android & iphone are pure shit. Rip n900...

That’s how I remember Nokia in the first half of the 2000’s: peak arrogance. Even if Steve Jobs himself would have given them the iPhone for free, they would have rejected it.

The N-series were great too, I loved both my N73 and later a N82, both with Gameboy emulators.

I also bought a Garmin license where I could install Garmin on my Symbian phone to do car navigation on my phone, this was at a time where most people had specific hardware for GPS navigation, now we're used to having apps on our phones, but it felt quite special back then!

I love Finland and the Fins. But there is a certain type in that population that is extremely bureaucratic. The only country in Europe that has a contingent that comes near is Switzerland, also a great place to live.

This is pretty much just describing the bimodal nature of most markets.

Extracting $100 in surplus profit from someone who's not on the poverty line is easier than extracting $10 from someone who is.

> the iPhone was only "in charge" for a brief year or two, and then Android ate its lunch in terms of marketshare.

This is true worldwide, but there are significant regions where iOS quite handily beats Android (such as the US, Japan, and even some parts of Europe).

> Nit: the iPhone was only "in charge" for a brief year or two, and then Android ate its lunch in terms of marketshare.

Marketshare is less interesting than wallet share for many products.

> a minority marketshare can capture the vast majority of profits

Ah, yes, exactly, there it is.

iPhone offers wallet share, and continues to eat Android's lunch in both total spend and ARPU.

There are two cohorts to be in charge of, for two business models: selling something, or giving it away to show ads.

This looks like Android dominates until you get to the section "iPhone vs Android App Spending" and start doing the math that it's winning on total dollars never mind the number of devices.

https://backlinko.com/iphone-vs-android-statistics

Even then, advertisers tend to advertise because they want to sell something. Advertisers marketing something everyone buys, Android audience is best to advertise to. Advertisers with something that depends on extra cash in the wallet before the buyer considers it, iOS audience makes sense. Ad rates reflect this.

Astonishingly, even on the handset makers themselves, there were years Apple captured over 100% of the revenue. That sounds nuts till you dig and see it's as simple as Apple made money, while so many other handset makers lost so much money.

~Thrice. Airpods.~

Edit: Airpods also has a majority market share, so probably it's not the third in this list.

This is such an important lesson!

I was a day one Android fan (got the Nexus One) but I'd actually debate what "in charge" means... to me it doesn't necessarily mean dominating market share. I think the iPhone defined the touch-based smartphone when it came out and continues to do so. These days Android has a much more cohesive concept (in the form of Material UI and so on) but in the early days it was just a hodgepodge mess of ideas, even if it dominated the market.

Were virtual network operators (?) - VNOs - a thing back then, and could a VNO make its own rules? If so, could Apple (or Palm or RIM) launch their devices without carrier compromise by also owning a virtual network? I guess this would have required a lot of money. Maybe Nokia could have done it?

> Jobs isn't the only guy who could have negotiated that kind of deal

This is a debatable claim.

> Apple was a second run computer company that had almost no previous phone experience. They were not exactly negotiating from a position of strength

The iPhone was not a mobile Mac. It was an iPod with an inbuilt cellphone. iPod was HUGE. That was their upper hand.

Apple in 2006 wasn’t a computer company, they were the iPod company.

It was huge as a consumer product. And that was the only thing that could convince a carrier to take a bet with Apple: they wanted exclusivity on the “next iPod”.

I would expect that being a computer company gave Apple more leverage than the handset makers. Apple could afford to have none of the providers say yes.

Moreover, Apple had prestige. It wasn't that big but it already the high-end computer maker. And Apple had the already successful ipod which served as the basis for the original iphone. And the handset makers had been fundamentally dependent on carriers in determining what features made it to the final phones - which would have had to made them essentially weaklings.

Which is to say, I think there's reason to think Apple had strength in it's negotiation position relative to a random handset maker.

Steve Jobs could say that but as the old saying goes, you are not Steve Jobs.

By the time that the iPhone was introduced, Apple was riding high on the iPod.

That's probably what happens once the traffic quota is exceeded, I would guess.

My pet theory is that this is the natural lifecycle of almost all companies and the reason for that is that they underappreciate the luck involved in their first success. There are a few exceptions in the form of zombies (typically relying on a monopoly or legislative help), but there are very few repeatedly innovative companies.

Remember Jim B. scoffing at how you had to plug an iPhone in every night? And how much more efficient BlackBerrys were with data?

Steve knew that the customers did. not. care. And that the carriers would build more cell stations if they had to.

I worked with an ex-Kodak guy, and he related the following story to me from the 80’s or early 90’s.

Xerox was kicking their ass, they were completely owning the copier market. But it was a natural fit for Kodak, they knew imaging better than everybody, why couldn’t they get into this market? This guy was on a crack team of engineers a VP assembled to create a competing product. 9 months later, they demo a fully digital copy machine, working, ready to go, with competitive pricing and features.

But the higher ups at Kodak were incensed. They told the product needs a redesign, because Kodak was a film company, so the product needed to use film for copying. The revised product was a complete failure, and was the reason said engineer left Kodak shortly thereafter.

My take is devotion to brand identity is death during these critical inflection points. YMMV

Kodak also bought Ofoto in 2001. So basically they had over a decade lead on Instagram. What did they do with it? Try to drive people to print more photos, on Kodak paper. I don't think they ever really embraced digital, maybe isolated parts of the company did, but the film/print cultural inertia was just too strong.

If you aren’t already familiar, Clayton Christensen’s theories on this, on innovation and disruption, are widely praised.

https://en.wikipedia.org/wiki/Clayton_Christensen

One of the problems for Kodak was that selling people digital cameras was always going to be just a fraction of the profit of selling them film.

Today, in 2025, Fujifilm makes more money from selling film (Instax instant photo film) than they do from digital, even though they "won" in digital over Kodak to some extent.

The theory is already out there, it’s called Counter-Positioning. Hamilton Helmer in 7 Powers.

It’s a bit more nuanced as Kodak isn’t such a case due to digital photo being commodity.

- Can't play Flash.

- Forces devs to release their apps as open software, HTML5 apps that anyone can just install the home screen from anywhere*, no marketplace gatekeeper needed, no 70% rev share to the telcos.

* This remains true, except if you really want to you can pay 30% in year one and 15% thereafter for shelf space, mobile apps PaaS, billing/subscription management, and end user app payments support. If you don't want to, you can still just release HTML5 apps like the Xbox Cloud player from Microsoft, downloadable direct from their web site, no App Store involved. And the HTML5 locally installable PacMan game from 2007 still works.

Not supporting Flash and Java was an advantage. Having apps written in an actual performant language made sense.

RIM with their minimal OS and a bunch of Java crap on top of it, just wasn't gone cut it.

Expensive is the only good point. But the issue with expensive is that, if everybody wants it, like 10% of the population will get it, and the other 90% will want it. And then you have product everybody is trying to get.

The iPod applied the same strategy. When it launched it only worked on Macs with a FireWire port, meaning <10% of the personal computer market.

In what way is a BYD a completely different/revolutionary product compared to, say a KIA or Volvo EV? This comparison seems a bit strange tbh.

Sure they are more nimble and have higher margins. But the products they make are still just copies of what those other dinosaurs are making. And for a car I'm still very reluctant to buy a Chinese one. Politics aside, what I'm buying is a 5-10 year long service experience where the Volvo dealer is 1km away and where the BYD service location is I'm honestly not sure. It might be around the corner too, but I don't know because it hasn't been there for 50 years yet. It's a much harder market to break into. The easiest way to do it is probably the way Geely and SAIC did it - Buy a brand and/or service network.

I don't see the comparison. BYD is a decent car for an impressive price, but they're ... just cars. The iPhone wasn't "just a phone" that was cheaper than its contemporaries and a little better in very specific areas, it was a complete overhaul of the entire market.

You can look at a BYD and a Nissan and make a decision based on minor trade-offs between different aspects of the car. You couldn't do the same between iPhone and a Sony Ericsson.

I somehow fail to see this as the most I want in a car is confort and perhaps space not screen time.

A killer feature for a car would be FSD but that’s not an “iPhone” thing.

BYD and the other Chinese manage to sell good EVs for great prices but I don’t see them irreplaceable like the iPhone.

Maybe they are the new Toyota but not the iPhone.

Same goes with Tesla though it’s more complicated because Tesla keeps promising FSD.

The iPhone didn’t promise anything. It just delivered.

IMO it's shocking that this _did not_ happen in cars, in past tense.

Model S launched 12 years ago. Apple replaced Nokia in 4 years. Model Y was the second best selling car worldwide, supposedly, after a Toyota and followed by a Toyota. Tesla has market share of about 2.3% globally and stays out of top 10.

iPhone became de facto definition of a phone. In less than 5 years from nothing. Tesla is... not that.

BYD+CATL is Android. Tesla is Apple.

By borrowing your analogy, the general sentiment with the iPhone was excitement and interest when it came out. I just don't see it in the folks around me regarding EVs (price is high, charging is pain). Yes, it's the future, but a future that is way ahead. We aren't even at the point where those old "devices" start to show their age. I'd say Symbians and Ericssons still have time.

I disagree. Cars are much more entrenched status symbols than phones were back then. A Porsche is a Porsche, a truck to show you're manly and outdoorsy is a truck.

People will continue to buy brands they know and whose marketing aligns with how they see themselves. Not everyone will switch to BEVs for a variety of reasons - cost, lack of infrastructure, or hell, even contrarianism.

VW, Renault, Nissan, Stellantis, Toyota can change fast enough before BEVs are the only thing on the market. All of them already have models in various sizes (e.g. Renault make very good and adequate cheap EVs nobody else comes even close to in the big EU markets) and varying quality. It's easier for VW to improve their EVs than it is for Tesla to launder their image.

I wouldn't count Toyota out. Their mega battery plant in North Carolina is coming online this year, and the biggest drag on their current EV/PHEV lineup is the batteries. New EV/PHEV models are on the way, and frankly if they just update what they have with better batteries they will be absolutely phenomenal because they are currently great to drive and run extremely well despite lackluster battery range.

Did you work with Symbian/UIQ software, feature phone software or something else? The feature phone team actually showed signs of getting the idea of no-jank and a rich UI very early.

A lot of people made the same mistake. They didn't understand -- simply couldn't understand for some reason -- that the imperfect iPhone that was launched in 2007 was the worst one that would ever exist.

You see this attitude a lot today. ("AI? LOL, it can't even count the letters in 'Strawberry.'") People have a mental block when it comes to understanding that the value of something new doesn't matter as much as its time derivative.

Can you elaborate?

My memory is that Apple _charged_ developers to make apps :)

As a developer, I remember a few bosses that thought "who needs a stupid phone? no one will buy that" except that Android could already do most of what Windows was capable of, and the bonus was that the SDK was free and Java was an easy language.

They were stuck in their post-Windows 95 world, and did not understand that multimedia CD-ROMs were clunky and dying.

Wasnt ISDN still circuit switched?

> as likely the black rectangle would be developed by someone eventually, phone carcinization

Relevant: LG Prada (2006) https://en.wikipedia.org/wiki/LG_Prada

> For example, the bullet "scaling the user experience to lower HW specs may be challenging. iPhone mini may be closer to iPod UI" comment still suggests they were stuck in the mindset of the time. They thought it was unlikely that Apple could deliver a horizontal platform, rather Apple would be launch a series of individual phones at different prices, each with bespoke interfaces, just like all the players had been doing, over and over.

Indeed. I referred to it at the time as the 50-model strategy.

> Parts of the deck suggest that they didn't fully understand what they were facing.

The biggest one to note is the somewhat-hopeful comment that the lack of Java support was cutting off the iPhone from a "large swath of existing software" ... that barely anyone enjoyed using, and didn't amount to much mindshare or incumbent advantage.

the mention of lack of Java was also very indicative of the mindset

also that most of the deck is about the hardware.

There is almost no understanding of the software needed for an iPhone UI.

That Apple succeeded in having people pay $500 and up for a phone that was cool but frankly not very useful, was amazing.

We should remember the original iPhone was more a tech demonstrator than anything else. It had the revolutionary touch screen, yes, but you couldn't really DO that much with it. There wasn't even an app store! You still needed to buy a digital camera and a garmin GPS and so on. This was a telephone in the old sense of the word (For younger readers, "telephone" used to mean a thing you made calls with).

The fact we pay 2-3 times as much now for premium smartphones is no wonder. Now it's a PC power thing with a better camera. By the time the iPhone 3G arrived it was a marvel. It had ironed out most of the kinks of the early versions, added the GPS, App Store etc. But by then, the other dinosaurs were already dying. They murdered them with the initial versions of the iPhone, which really weren't even that impressive.

The presentation shows they were aware of what was happening. But that Nokia didn't just make their portfolio two lines (really simple cheap feature phones and really expensive all-glass smartphones) on the day after this presentation came out, is strange.

The first Nokia phone-mini-computer was the original Communicator, with a 640x200 resolution and a full keyboard, launched in 1996(!) Of course at that time it was targeted purely for business users, but by 2007 they already had a well-established high-end consumer smartphone selection (the N series – rather more advanced than the first iPhones). They just weren’t able to pivot to the touchscreen form factor, largely due to betting on Symbian – I can see how writing an entirely new OS userland from scratch wasn’t a terribly attractive idea.

In the end they did that too, of course, and the N9 was an astonishingly good phone, with a slick zero-button interface and silky smooth scrolling and multitouch gestures. And a terminal and reasonably-privileged root access if you were so inclined. I used a normal ssh/screen/irssi combo to IRC. It’s such a fucking shame that Maemo/Meego was killed.

> and this was the age of "smaller is cooler" mobile phones, so they tried to keep the screens small.

I, for one, would love a return to "smaller is cooler" with small screens and big numeric keypads. I have an elderly relative whose only use for a smartphone is calls (it's a phone after all) and text messaging (SMS and WhatsApp); these don't need a big screen.

This section: “There is nothing revolutionary or disruptive about any of the technologies. Touch interface, movement sensors, accelerometer, morphing, gesture recognition, 2-megapixel camera, built in MP3 player, WiFi, Bluetooth, are already available in products from leaders in the mobile industry” has to rival “No wireless. Less space than a Nomad. Lame.” In the early impressions that didn’t age well category.

Not that it hurt her career in any way, looking at her Wikipedia article. Failing upwards is a thing.

I would kill to see the presentation from RIM

This is to Nokia's credit. It didn't work out, but they also weren't arrogant like RIM or Microsoft

The bawk stops here.

Clearly in retrospect these were transferable skills.

Stephen Elop’s good a$$ barbecue and foot massage

Well, $500 in 2007 is $756 in 2025, not exactly a "budget phone" price.

It was $500 with an expensive mandatory 2-year contract. With an expensive 2-year contract you can get most budget phones for 'free'.

> In the end I was mainly using mine to listen to podcasts (before they were called that)

I'm interested in understanding what you meant here?

To my understanding, the N800 was released in 2007 according to Wikipedia[1] and the first craze of podcasts was in the first half of the 00's, with the most notable fact being the official support of podcasts in iTunes in 2004[2]. They then lost their fame before knowing a second wave of popularity starting in the second half of the 10's.

Are you talking about something else?

[1]: https://en.wikipedia.org/wiki/Nokia_N800 [2]: https://en.wikipedia.org/wiki/Podcast#History

>And you still had to carry your flip phone in another pocket.

UPDATE: Memory failure! I meant N900, not N800

Why? I had N800 as my only mobile, and was more than happy with it. Stylus was not optional for things like browsing. But most of the time I took it from my pocket, I used it for text input, and physical keyboard made it comfortable to the point no other device has been able to offer me ever since I retired my N800

I never had a N800, but I still have a working N900 used as my secondary phone and while it has a stylus holder, I have never pulled it out of there for many many years except to stim. Its resistive touch screen was excellent and I liked it more than today's capacitive screens. The only issue I have with it is that it's ageing and developing problems over years and eventually I may end up out of spare parts.

I had one too (and a 770 before it). Great idea, so-so implementation. It was slow (and slowness is a cardinal sin, since you're always reminded that you're using a machine -- in my opinion, the way Apple products react so much faster to user input than competing products is a huge factor in their success, and Apple knows it) and the touch screen was terrible.

Yes, that platform was set to compete with iOS and Android and with fine timing.

I think they fumbled with the developer relations when first choosing Gtk for the UI and then jumped to QT. That made developers angry. And then of course the Microsoft steamroller killed it.

The App Store didn't exist for the first iPhone. It launched with the iPhone 3G. The original plan was for everyone to develop web apps; the SDK was added due to external developer demand.

https://en.wikipedia.org/wiki/App_Store_(Apple)#History

Not denying how important it was, but the App Store wasn't "invented". It was created because Apple listened to what developers wanted.

As a Linux user, it just felt like a locked-down package repository to me.

Pretty sure there was some sort of App Store.

It didn’t have a hell of a lot in it, but I remember grabbing a cute little game (hex-a-hop) and … maybe an Angry Birds demo on it?

— edit - I’m thinking of the N900

Yea, no one believes me when I tell them that the Lumia with Windows Phone 8.1 or 10 was one of my favourite phones ever. WP 8.1+ was such an underrated OS. Unfortunately it had virtually no support from anybody, even Microsoft quickly stopped caring.

> Because they didn't have the sharp focus of Android and kept a lot of crap from Linux (like X11 sigh)

X11 let them use existing apps outright and made porting easy. What else would they have used at that time and what advantage would it give them?

If I see another one of these insane "explainations", I'm gonna have a stroke. Nokia - dominating the mobile phone market for years - is evidence that Europeans are just fundamentally incapable of innovation!

Ok bro.

Steve Jobs was a boomer.