Business
4:00 am
Wed April 4, 2012

Nokia Aims For Comeback With New Phone

Transcript

RENEE MONTAGNE, HOST:

And this weekend Nokia rolls out its newest smartphone to the American public. It's called the Lumia 900. Nokia is trying to break its way back into the high-end mobile phone market it once dominated. In this fight against Apple iPhone and Google's Android, Nokia is the underdog now.

And as NPR's Steve Henn reports, it has joined up with Microsoft in its bid to make a comeback.

STEVE HENN, BYLINE: When I pick up a smartphone what matters most to me - aside from the basics like it can actually make calls - is that the phone is smart. I'm a Dad. I depend on my phone to help me answer my kid's questions. Questions like...

ELLA HENN: Who was Crispus Attucks?

HENN: It's American History Month.

HENN: Who was the first patriot killed in the American Revolution?

(SOUNDBITE OF BELL)

HENN: What was the nickname for the battle of Lexington and Concord?

(SOUNDBITE OF BELL)

HENN: So when I got the newest Nokia phone, my daughter Ella and I decided to put it to the test - head to head versus the iPhone's Siri.

SIRI: How about a Web search for who was the first pitri killed in the American Revolution?

(SOUNDBITE OF LAUGHTER)

HENN: What's a pitri?

HENN: Nokia's new phone got nine of 10 questions correct. Siri understood what we were asking less just half the time - and even when it got an answer right it took up to four times as long to respond. But beating Siri in voice recognition may not be enough to help Nokia regain its crown as king of the mobile phone industry.

To understand just how far Nokia has fallen, another little history lesson less might help. Back in the late 1990s, when Bill Gates was still the undisputed king of the geeks, Nokia was Europe's answer to Microsoft. It dominated the mobile phone market. It was the most valuable company on the continent. Nokia seemed almost invincible. But by the fall of 2010, all of that had all changed.

BEN WOOD: This was a company that had lost its CEO - its number two in command left.

HENN: Ben Wood is a mobile analyst at CSS Insight in London. Wood says Nokia lost its footing. It fell badly behind in the race to create the global smartphone market. And then its board did the unthinkable. It hired someone from outside of Finland to run the firm. Stephen Elop - a Canadian - who came from Microsoft. His first act was to write a memo.

WOOD: An internal memo which was leaked which was called the burning platforms memo.

HENN: In it Elop compared Nokia's smartphone platform - this technology the company had spent billions of dollars developing - to a burning oil platform stranded in the North Sea. He told the entire company and all its employees they had to take a gamble and jump. Elop said Nokia would abandon its own technology and start building Windows phones with Microsoft. And Nokia was choosing a completely untested and unproven partner. But Wood says Microsoft was motivated.

WOOD: The mobile phone is emerging as the most prolific computing platform on the planet.

HENN: Microsoft has to compete in this space. It has to succeed.

WOOD: Microsoft will spend every last dollar, dime and cent on making sure they are successful in mobile - because if they don't their future will be in jeopardy as well.

HENN: And over the last few months in Europe and China, Nokia has introduced stylish new phones that look and feel different.

Carolina Milanesi says that's the point.

CAROLINA MILANESI: With this device we need to get consumer's attention.

HENN: Milanesi is a mobile analyst at Gartner.

MILANESI: You are talking about a phone that is comparable to a high-end Android or an iPhone.

HENN: But it's a bargain, selling for half the price of Apple's new iPhone. And that means Nokia and Microsoft may not make much money on these new phones but they are doing everything they can to make sure consumers take notice.

Steve Henn, NPR News, Silicon Valley. Transcript provided by NPR, Copyright National Public Radio.