Innovation is the key to survival
Microsoft Corp’s $7 billion bargain with Nokia to drum up a mobile future for the software giant is a tell tale sign that unless you innovate in the cut throat global telecom sector, you are likely to perish or be gobbled up by the bigger fish in the ocean. While Nokia’s current CEO Stephen Elop is likely to replace Steve Balmer, who has announced his retirement some time back, insiders admit that the Finnish company’s effective exit from the mobile business – one that it pioneered the world over, particularly in India, where its trademark handsets are still fashionable despite being thoroughly supplanted by first Apple iPhone and then Samsung – is now imminent. Of course, it is a sentimental moment for both Nokia and its millions of users worldwide, but financial viability and strategic choices were such that the acquisition with Microsoft was the way out. Clearly, this means that Nokia, over the past few years, has suffered enormous losses, in terms of brand value and actual sales of its mobile units, particularly in the wake of exponentially rising appeal of smartphones with touchscreens.
Clearly, the telecom and information and communications industry, which is increasingly becoming a troika of Apple, Google and Samsung, is extremely volatile and is the site of ever-new trends that not only make the experience of mobile telephony integrated with other interfaces of communication, such as internet, satellite television, smart phones and TV, but also ride the tide of a constant redefinition of what is meant by ‘cutting-edge’ technology. Nokia, which heralded the mobile revolution the world over, had been struggling to make ends meet and its acquisition by Microsoft is therefore an unfortunate though necessary measure to stay afloat. The company’s mobile phone business accounted for almost half of the group’s revenues last year, and clearly profits had thinned. to propel the top brass towards the drastic step. Nevertheless, the sentimental readjustment will be a heavy price to pay.