Nokia CEO admits Apple and Google are streets ahead

A frank and honest memo from Nokia boss Stephen Elop, that has been doing the rounds online, has been confirmed as genuine by the BBC.

The memo, in which Elop (who took over to steady the ship after Nokia fired former CEO Olli-Pekka Kallasvuo back in September) tries to rally the Nokia workforce, and admits openly that the Finnish manufacturer is struggling to compete with the likes of Apple and Google in the battle for smartphone supremacy.

Elop's memo likens Nokia's situation to that of a "burning platform" of which Nokia fuelled itself by lacking "accountability and leadership to align and direct the company through these disruptive times".

"There is intense heat coming from our competitors, more rapidly than we ever expected," he writes.

"Apple disrupted the market by redefining the smartphone and attracting developers to a closed, but very powerful ecosystem.

"The first iPhone shipped in 2007, and we still don't have a product that is close to their experience. Android came on the scene just over 2 years ago, and this week they took our leadership position in smartphone volumes. Unbelievable.

"Apple demonstrated that if designed well, consumers would buy a high-priced phone with a great experience and developers would build applications. They changed the game, and today, Apple owns the high-end range.

"And then, there is Android. In about two years, Android created a platform that attracts application developers, service providers and hardware manufacturers. Android came in at the high-end, they are now winning the mid-range, and quickly they are going downstream to phones under €100."

Elop also states that Nokia is under threat from Chinese manufacturers in the budget market and admits that Nokia has fallen behind, missing "big trends" and losing time.

MeeGo (or rather the lack of) doesn't escape his wrath either. "We thought MeeGo would be a platform for winning high-end smartphones," he states. " However, at this rate, by the end of 2011, we might have only one MeeGo product in the market."

And Symbian gets a bashing too, saying that the OS is "proving to be an increasingly difficult environment in which to develop to meet the continuously expanding consumer requirements."

He ends on a positive note, which Nokia employees probably struggled to read through their tears though, and hinted at some big announcements for the company at its Capital Markets Day on 11 February.

There are rumours aplenty as to what might be revealed, with Windows Phone 7 tie-ups and more focus in Silicon Valley the most likely contenders.

Whatever is announced, it's clear that Nokia is up against the ropes, and it looks as if its legs have gone too.

Only time will tell if Elop does manage to get things back on track.



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