Submission Date: ___/04/2019 AIMAN JAMIL

04151713057
BSBS- 4A

THE RISE AND FALL OF

• Founded in 1865
• Started as a timber company near Nokia, Finland.

1965-1970s (Bjorn Westerlund)

o Late 1960s; merged with other companies to form Nokia Corp.
o 1970s; developed Mikro Mikko Office Computer and obtained 80% market
share in Finland.
o Developed 1st wireless phone for Scandinavia govt. services.
o 1971; Developed analog car radio telephones.
o Had a 50/50 joint venture with state owned telecom networking company.

1977- 1988 (Kari Kairamo)

o 1983; 1st International acquisition of Luxor AB.
o Increase in export to Europe, UK, North America and Asia.
o 1987; 54% increase in revenue & €210 million investment in R&D.
o Established 2G network.
o Consumer electronics division (70%) struggled due to low cash reserves.
o 1988; became major player in analog handset market with market share of
13.4%.
o Net income fell to €199million i.e., 23%

1988-1992 (Simo Vuroilehto)

o Restructure of firm into 5 divisions but the poor performance continued.
o 1991; Total sales dropped 31% from previous year.
o Consumer electronics division suffered loss as the colored TV set sold poorly
o The fall of Soviet Union pushed Finland into economical crisis and the company
was unable to obtain loans.
o Telecom Networking division was thriving and earned revenue of €323million.

1992- 2006 (Jorma Ollila)

o Adopted the “back-to-basics” approach.
o Focused on 4 business areas
o 1992; received 25% GSM Equipment orders for Europe
o Entered Japanese market.
o Became largest mobile phone producer in Europe and 2nd largest in the world.
o Ollila (CEO); predicted handset penetration to increase 20% by 2000
o 1994; Obtained 25% market share in Finland Stock Exchange and became the
1st finish company to be listed in New York stock exchange.
o 1998; became the leading mobile phone manufacturer with 23% market share.
o Protected its technology developments through patents.
o 1999; Launched 1st camera phone and1st phone with web browsing feature.
o 2002; reorganized its four divisions
o Controlled 40% of the GSM and 5-7% of CDMA market share.
o TCL became the largest handset manufacturer in China
o 2003; Introduced 1st touchscreen device which worked with stylus.
o 2004; Slow sales decreased market share to 28.9%.
o 2005; Low-end handsets became popular in Asia.
o ODMs started growing and threatened vertical industry model companies.
o Sudden emergence of different brands pushed Nokia down.
o Nokia’s patent portfolio, 1600 patents, helped ensue its dominance still.
o 2005; 3G emergence - LG became the first mover.

2006-2010 (Kallasvuo)
o 2006; Joint venture with Siemens which earned revenue of
o 2006; Joint venture with Siemens which earned revenue of €15.8 billion
o Smartphone industry emerged and Nokia Smartphones ran on Symbian OS.
o 2007; Apple introduced iPhone which ran on iOS.
o Nokia’s market share dropped in US but remained the most used in the world.
o Android OS became the most used but wasn’t adopted by Nokia.
o August 2007; Nokia launched its online store to sell songs, games & maps
compatible with Symbian OS and started developing another mobile computing
OS.
o Bought Navteq, digital map database. for $8.1 billion
o 2009; Maintained highest market share at 34%

2010-2013 (Stephen Elop)

o 2010; maintained 40.3% market share.
o Symbian OS was abandoned, and Windows Phone 7 software was adopted,
and shares fell 14% the day it was announced.
o 2011; Smartphone market share dropped to 25% and market value dropped
75% from 2007 to 2011.
o Changed all Symbian OS phones in the market to Windows OS
o 2012; moved US operations from New York to California.
o suffered operating loss of €2.3 billion and gave its market leader position to
Samsung.
o 2013; Sold its Devices & Services Business to Microsoft and provided access
to Nokia patents for ten years for $7.2 billion.
o Upon announcing this deal, Nokia’s share price increased 40% and Microsoft
share dropped 5%