In 2008, Nokia was at the pinnacle of the mobile industry, raking in over $76 billion in revenue. Yet, in just a few short years, the company that once dominated the global market found itself in crisis, struggling to keep up with the smartphone revolution that changed the industry forever. This is the story of how Nokia lost it all and then staged an incredible comeback, rising from near bankruptcy to reclaim its place as a tech giant.
Chapter 1: The Fall of a Mobile Giant
In the early 2000s, Nokia was synonymous with mobile phones. In 1996, Nokia generated $7.5 billion, and by 2008, this figure had surged tenfold. But Nokia’s success masked underlying vulnerabilities. The turning point came in 2007 when Steve Jobs unveiled the iPhone, introducing the world to a sleek, intuitive touchscreen interface. The iPhone revolutionized the phone market overnight, making Nokia’s durable, bulky phones feel outdated.
At first, Nokia’s management dismissed Apple’s new product, labeling it as costly and fragile. They believed the iPhone was simply a niche device, underestimating the transformative impact it would have. Soon, other competitors like HTC and Google entered the market with Android-based smartphones, leaving Nokia in a vulnerable position.
To compete, Nokia introduced the N97 in 2008, calling it an “iPhone killer.” With a 5-megapixel camera, touchscreen, and GPS, the N97 had impressive hardware, but it fell short due to Nokia’s outdated Symbian OS. Compared to Android and iOS, Symbian struggled to attract third-party developers, limiting Nokia’s app ecosystem significantly. By the time the N97 launched, Apple’s App Store already boasted over 100,000 applications, while Nokia had just over 500. This failure marked the beginning of Nokia’s decline.
Chapter 2: Stephen Elop and the Burning Platform
In 2010, Nokia appointed Stephen Elop as its new CEO, hoping he could steer the company out of troubled waters. Elop’s background as Microsoft’s former head of the business division made him a strategic fit for Nokia’s changing needs. On his first day, he delivered a controversial speech, known as the Burning Platform Memo. He described Nokia as standing on a “burning platform,” facing intense competition from Apple and the emerging Android ecosystem.
Elop’s message was clear: Nokia’s reliance on Symbian was sinking the company, and they needed to change course quickly. However, his words leaked to the media, which damaged Nokia’s reputation further, instilling doubt among shareholders and the public.
Instead of embracing Android, Elop chose to partner with Microsoft and adopt the Windows OS. Elop’s decision was driven by his deep ties to Microsoft, which funded Nokia with billions for developing a Windows-based phone ecosystem. In 2011, Nokia introduced its first Windows Phone, the Lumia 800, but the response was underwhelming. The Windows OS was poorly received, with users finding it unintuitive. Additionally, Nokia’s phones lagged behind competitors in terms of hardware specs, and the app selection was limited.
By 2014, Elop had left Nokia, returning to Microsoft, but he took many of Nokia’s key executives with him. Microsoft acquired Nokia’s devices division for $7.2 billion, only to shut it down in 2015. The Nokia–Microsoft partnership was deemed a colossal failure, and Nokia was left in ruins, having lost billions.
Chapter 3: Rajeev Suri and Nokia’s Reinvention
While the Nokia–Microsoft partnership was crumbling, another part of Nokia was quietly thriving: Nokia Solutions and Networks (NSN). Under the leadership of Rajeev Suri, NSN had transformed from an unprofitable division into a stable, profitable business. In 2014, Suri took over as Nokia’s CEO, bringing a long-term vision focused on financial stability and restructuring.
Suri redirected Nokia’s strategy, pivoting away from consumer electronics toward business-to-business (B2B) solutions. In 2015, Nokia acquired Alcatel-Lucent, gaining access to the prestigious Bell Labs and positioning itself as a leader in 5G technology. Suri’s conservative, calculated approach paid off as Nokia secured contracts with major telecommunications companies like AT&T and Vodafone. By 2020, Nokia controlled 29% of the global 5G market outside of China.
Under Suri’s leadership, Nokia emerged as a key player in the telecommunications industry once again. Their 5G infrastructure became essential, supporting over 6.4 billion subscriptions worldwide through its partnerships.
Nokia Today: Stability and Resilience
Today, Nokia may only be worth a fraction of its peak market cap, but it has something it lacked for over a decade: stability. Nokia’s transition from a B2C giant to a B2B powerhouse exemplifies resilience, turning a once-doomed company into a profitable force in the tech world once more.
Source and image credit: Logically Answered
