My previous post (visit link) is Finnish version of this one.

Tomi Ahonen, ex-Nokia executive, current consultant and writer has written open letter to Nokia shareholders. I feel responsibility to share my view to all those who happen to read this blog.

Tomi Ahonen is demanding (again) CEO Stephen Elop to be fired. And naturally shareholders have the right to do this, I just want to bring up all the facts Mr. Ahonen is skipping in his blog.

In brief, Tomi Ahonen says CEO Elop should be fired since he has made utter mistake in communication when presenting the new Windows Phone strategy, causing the current loss-making of Nokia (which he has entitled as Elop-effect). As Ahonen himself says: “Elop caused personally the transition for Nokia from profitable business to loss-making business, and he did this in February 2011. Nokia’s smartphone business which generated 40% of Nokia’s profits and had reported growing sales revenues, growing unit sales, and most importantly, strongly growing profits, was instantly plungedinto declining sales in units and revenues, and became loss-making.” [1] In addition, he says Nokia should have had more effort on N9 (the award-winning product) and Meltemi (rumored low-cost segment smartphone operating system of Nokia). In general Ahonen says CEO Elop is incompetent. As basis he states Nokia’s market share plunge from 29% to 7%. [2]
The largest problem of Nokia – Ahonen says – is operator boycott of Nokia mobile phones. As an example he takes China Mobile – largest mobile operator in the world – that is not selling a single Nokia Lumia Device. [2]

I would like to point out that the text of Tomi Ahonen is not on a stable basis and I don’t count him as reliable relating to anything related to Nokia. Good example is his use of Der Stern article. I have covered it here: (visit link)

But I promised to tell the facts Tomi Ahonen is not telling in his letter. So let’s start with Nokia’s market share plunge and it’s relation to February 11th 2011 announcement. I have covered it in more detailed level recently, if you want to read about it, here’s a link to it. (visit link) I’ll cover the details here too.

First of all, Nokia’s market share has not dropped from 29% to 7%, it has dropped from 39% to 6,7%. Reason that Tomi Ahonen is using 2010 end market share (28,5%) is that Stephen Elop as a CEO could not have affected the drop of 10,5 points (or roughly 26%) of Nokia’s market share in 2010.

The unit sales of Nokia fell in first quarter of 2011. However, that cannot be due to February 11th announcement. I have also written about that one, here’s the link (visit link).
Eventually, we can say that 15 points (or 38 percent) of Nokia’s market share disappeared before strategy change (or the way it was announced) had a chance to affect it. This – of course – Tomi Ahonen does not say. It is also worth noticing that market share plunge did not show any signs of slowing down in end of 2010 or at end of first quarter of 2011. So it is reasonable to assume market share plunge would have continued without the new strategy too.

Now China Mobile. Tomi Ahonen says China Mobile “refuses to sell Lumia”. I totally agree, China Mobile uses TD-SCDMA technology, which is not supported by anyu of the current Lumia devices. Selling those would be just as sane as selling diesel-powered cars in a country where only gasoline is sold.

In the writing I refered to previously I openly ask whether Tomi Ahonen is incredible liar or incredibly incompetent. Now he underestimates the intelligence of Nokia shareholders and asks them to do decisions of handset unit – based on recommendations of a man who has never worked for the said unit.
Please, do not take my word here, you can go and read this from the blog of Tomi Ahonen (the very same blog where he has published his open letter):

I am not a ‘mobile phone handset guy’ (really?) yes. My core competence is not smartphones or dumbphones or handsets. It is the ‘services’ and applications of mobile, where this industry makes most of its money. So my core competence is how the operators/carriers make their money with SMS, MMS, voice calls, mobile content like music, games, news; mobile telematics, mobile money, mobile advertising etc. That is my core competence. I really am not a phone designer like say Christian Lindholm or Jan Chipchase. I am not a user interface designer or operating software designer either. So I am honestly not the best person to write this blog – but I am an opinionated guy and I do have lots of thoughts on this subject.

And its literally ten years since I left Nokia HQ and started my own consultancy. I may have had some insights into Nokia markets and products and customers and end-users way back then, but not anymore. As I now live here in Hong Kong, we do not have a very ‘typical’ market, so I am not even exposed to all Nokia phone models here etc. I can make observations and educated guesses, but this blog will by necessity be incomplete. I am not enough of an expert.” [3]

So I’m not surprised Tomi Ahonen recommends to pick new CEO from operator community. Now let them change CEO if they wish to do so, but I think shareholders should be aware that since MeeGo development has been discontinued and employees laid off, new CEO would have to stick with the Windows Phone strategy anyway.

Tomi Ahonen also claims that N9 outsold Lumia devices. His base for the claim is a straight out fraud, but you may want to read more about it. I have covered it recently. (visit link)

Now I can assume people ask who I am.
I am ex-Nokia engineer, who worked over 10 years in Nokia. I have all the good memories from that time and feel that colleagues left behind are like family to me. So despite me being laid off due to strategy change, I simply take Ahonen’s text as if it was insult towards my family. Try to understand.
Many of my friends still work for Nokia and I want to spare them from difficult questions, so I have decided to keep the blog as Anonymous Ex-Nokian.
Since I cannot base my text on “known name”, I have to provide the references to my facts that I use to point out errors of Tomi Ahonen.

I just wanted to make sure shareholders know all the facts when the plan CEO change. Especially the ones Mr. Ahonen refuses to say.

-Anonymous Ex-Nokian-

REFERENCES:

[1] English version of open letter of Tomi Ahonen:
http://communities-dominate.blogs.com/brands/2012/08/open-letter-to-nokia-shareholders.html

[2] Finnish version: http://communities-dominate.blogs.com/brands/2012/08/avoin-kirje-nokian-osakkeenomistajille-this-blog-article-in-finnish-english-version-coming-next.html

[3] Post form Tomi Ahonen, dated January 31st, 2011: http://communities-dominate.blogs.com/brands/2011/01/return-of-the-jedi-nokia-can-be-saved-here-is-the-how.html

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