Nokia on Thursday said that it is planning to invest strongly in products and experiences that make Lumia smartphones stand out. It also intends to invest in location based services as an area of competitive differentiation for Nokia products and extend its location based platform to new industries
Nokia outlined a range of planned actions aimed at sharpening its strategy, improving its operating model and returning the company to profitable growth. While planning to significantly reduce its operating expenses, Nokia remains focused on the unique experiences offered by its smartphones and feature phones, including an increased emphasis on location based services.
It said that it is going to improve the competitiveness and profitability of its feature phone business and to execute this strategy, Nokia is making changes to its management team by tapping into the strong leadership bench at the company.
To support this period of transition, Nokia intends to improve its operating model by significantly reducing its Device & Services operating expenses, substantially reducing its headcount and reducing its factory footprint. As a result, Nokia intends to return to sustainable non-IFRS operating profitability in Devices & Services as soon as possible.
"We are increasing our focus on the products and services that our consumers value most while continuing to invest in the innovation that has always defined Nokia," said Stephen Elop, Nokia president and CEO. "We intend to pursue an even more focused effort on Lumia, continued innovation around our feature phones, while placing increased emphasis on our location based services. However, we must re-shape our operating model and ensure that we create a structure that can support our competitive ambitions."
In Smart Devices, Nokia plans to extend its strategy by broadening the price range of Lumia and continuing to differentiate with the Windows Phone platform, new materials, new technologies and location based services.
In line with this strategy, Nokia today announced the planned acquisition of assets from Sweden based Scalado, which currently has imaging technology on more than 1 billion devices. This acquisition is aimed at strengthening Nokia''s imaging assets.
Nokia's location based platform is expected to be another principal area of investment as Nokia plans to differentiate its portfolio of Lumia smartphones with leading location based services including navigation and visual search applications such as the recently announced Nokia City Lens. Additionally, the company plans to extend its mapping technology to multiple industries to strengthen the platform and generate new revenue.
In Mobile Phones, Nokia intends to improve its competitiveness and profitability. Nokia aims to further develop its Series 40 and Series 30 devices, and invest in key feature phone technologies like the Nokia Browser, aiming to be the world's most data efficient mobile browser. Early results of this innovation can be found in Nokia's latest Asha feature phones which offer a full touch screen experience at lower prices.
Balancing its investment priorities, Nokia plans to rescale the company by making additional reductions in Devices & Services. Nokia plans to pursue a range of planned measures including: