North America is tough neighborhood for Nokia. While the Finland-based cell phone giant is reputed to control over 40 per cent of the mobile market globally, its brand is stamped on a mere 10 per cent of America's sets.
But Nokia's CEO Olli-Pekka Kallasvuo is pretty optimistic about his stateside prospects. Speaking to Silicon Valley's Churchill Club, he said we should expect the US to soon steal Europe's we-drive-the-mobility-market crown, as more emphasis is placed on software and internet-based services.
"I think this will be driven by the Valley," said Kallasvuo. "The US, as opposed to being a laggard, will lead."
But where would that leave Nokia? Software has historically not been been its strong suit. Then there's a few of American joints known as Apple, Google, and Microsoft getting deep into the mobility software act as of late.
"Suddenly, you have the mightiest companies in the world as your competitors," said Kallasvuo.
"It's sort of mind boggling. You have to stay humble and say 'it's a new game, there are new business models.'"
Nokia made its play in June by purchasing Symbian and then pushing the OS into an open source foundation. Kallasvuo reckons it has struck up a a sweet combination of open and mature software that can put it ahead of the race.
What does Kallasvuo think about the competition? Apple's iPhone is based on mature software platform, but it's certainly not open. Microsoft is the same. Google with Android is (pretty much) open, but its OS is the new kid on the block.
Nokia believes it had built it, but will developers come? Fighting the sex appeal of Google and Apple isn't easy even with a nice personality.
"It's quite easy to see when it comes to the US — especially in the Valley — [Apple's] App Store and Android have more mindshare," Kallasvuo said.
Meanwhile, the company has RIM to worry about. The Blackberry has found itself becoming the de facto standard for corporate communication in the States. Nokia's answer has been somewhat of a retreat, leaving corporate email to enterprise vendors such as Microsoft, IBM, and Cisco. Meanwhile, it's buying OZ Communications, a Canadian-based company that specializes in consumer mobile messaging.
Kallasvuo assured that Nokia will remain active in the corporate email space, all the while making new strides into the consumer and what he calls "pro-sumer" email markets.
But if North America is supposed to be where the action is for for a new generation of mobile products, surely a lack of modern infrastructure would get in the way. After all, the US lags far behind much of Europe in terms of internet bandwidth per capita. If Nokia expects to push services — especially video and TV — could it make due with what it has now?
"I think the US [infrastructure] is quite advanced," said Kallasvuo. Yet he concedes: "Sometimes the coverage is spotty. US networks are not necessarily that strong."
There's a silver lining.
"Data plans in the US are quite competitive. You can get a lot of data at reasonable amount of time. And consumer take-up is happening thanks to the iPhone. I see plenty of opportunities in the US. Man of these things, including video and TV can really start to happen here." ®