HMD admits it has abandoned Nokia’s flagship software for the time being

Last week’s tech news cycle was filled with announcements from several companies during MWC 2022. But Europe’s most popular mobile phone brand, Nokia, was hardly on anyone’s lips at Europe’s biggest mobile conference. HMD Global, the current manufacturer of Nokia phones, introduced some new devices, but they were all very low-cost smartphones. Nothing can hold a candle to the likes of Honor Magic 4 Pro and Realme GT 2 Pro. This obviously made us wonder if HMD had completely abandoned Nokia’s flagships, and we were able to get an answer that is as clear – or as clear as possible – from the company.

In our conversation with him, Adam Ferguson, Head of Product Marketing for HMD Global, told us in no uncertain terms, “Making a $800 phone just doesn’t make sense to us right now.” This is HMD’s candid admission that they are no longer interested in chasing the lead crowd, and it’s a doubt we’ve all had for a long time. As a matter of fact, Adam added that HMD “doesn’t want to get involved in a massive spec war with other players” and would rather “defend something completely different”.

Why did HMD stop making flagships

HMD Nokia smartphone and feature phone shipments to Q4 2021

In its first few years on the mobile scene, HMD Global tried to do just that everything. Hit every price point, sweep the feature phone segment, innovate at the highest level, keep updates fast, stand out by offering a clean Android One experience, and expand into global markets. All using the resources of a small startup company and while trying to revive a dead name that carries a lot of nostalgia and even more baggage. Looking back, we can all agree that it’s less than you can chew on, and a lot of it fell apart around the release of the Nokia 9 Pureview in 2019.

Looking at HMD’s unit shipments and vague financial announcements, it’s clear that the company took a big hit in 2019 that lasted into the first half of 2020. The pandemic didn’t help, but things are starting to pick up. slowly. Shipments have grown, finances are healthier, and HMD has been in profit for six quarters — that’s since the third quarter of 2020. That’s something to be proud of and Adam was happy to repeat.

Thanks to the change in its strategy, HMD has been profitable for six consecutive quarters.

The fourth quarter of 2021 was HMD’s most profitable quarter to date, according to Strategy Analytics (Across Nokia Mob), shipped more smartphones (3.2 million units) than in the fourth quarter of 2019 (2.8 million units). Smartphone revenue grew 41% year over year, from 2020 to 2021. And the entire company’s shipment numbers, including feature phones, are slowly recovering from their massive decline in 2020.

Behind this rise in profitability is a change in strategy that many of us have criticized over the past few years. Looking from the outside, it looked like HMD had just thrown in the towel and was on her way out, which turned out to be a far cry from the truth.

It’s true that HMD stopped pursuing the high-end market, scaled back its device launches (especially the upper mid-range), skipped or delayed some updates, and slowly faded away from the news cycle, and overall we did whatever we geeks crowd out was championing a Nokia comeback. A little, he didn’t want to. All in a series of compromises that have left many fans disappointed with Nokia – once again. But it’s also hard to denounce this strategy now, given how successful it is from a business perspective.

Our review: 5 years later, HMD’s deal with Nokia is a tale of wasted potential

Strategy centered around the budget market

Nokia booth at MWC 2022

Rita El Khoury / Android Authority

Nokia booth at MWC 2022

Right now, HMD tells us it’s focused on building good feature phones and good entry-level mid-range smartphones. It wants to make devices that last several years, and a battery that lasts several days, at an affordable price. It also aims to be a leader in the US prepaid smartphone market by the end of 2022 (Strategic Analytics). In laying this foundation, hopes to “earn [its] Spurs then expand in a way that supports the core business,” according to Adam. The spec wars and fight to cram so many features into a profitable smartphone seem to be hardly off the table, for now.

And if you ask me, this is the right thing to do. In all honesty, I started preparing for this article from the perspective of a former Nokia fan. (For those of you who don’t know, Nokia was the hallmark of my early mobile tech writing career in 2007-2010, and I have “feelings” about it). The MWC ads, the tiny show booth (seriously, it was the size of a living room), and all the “wrong” decisions I thought she was making. But after stepping back on those charged feelings and looking at the company’s performance and strategy in the past couple of years, I can’t help but agree that most of it makes sense.

It is better to start from scratch with a healthy foundation than to stubbornly continue down a losing path.

It’s better to let the Nokia brand revival fade away than to let it die completely again, and starting from (almost) scratch with healthy foundations is better than continuing stubbornly down a lost path. I still think that many avoidable mistakes were made on the way: the failed update and buggy software could have been handled better, the company could have been more transparent about shortcomings and change in strategy. There is also a more recent issue of HMD patents being banned in Europe, and the current unclear direction taken with/without Android One. Much of the goodwill gained in 2017-2018 was wasted by these missteps and many more.

HMD Global Nokia Phones Back Panels MWC 2022

Eric Zeman / Android Authority

What’s next for HMD and Nokia? Adam says they still have “more to do,” to say the least. At its peak, HMD was the eighth largest smartphone maker in the world, and now it has reached the eleventh position. At the time, it was also part of the weekly conversation on every mobile and Android website. Updates, releases, news, there were interesting things to be covered and for you to read. Currently? Android salad They did not consider the new C21 and C21 Plus worthy of a separate ad article; We just mentioned them in our MWC report. It’s hard to see which brand made the Nokia N95 and E71 fall into a section where other stars shine as well.

Gaining consumers’ trust for the third time will not be an easy feat.

Once it is ready to rise again, HMD has to fight a very competitive battle in the mid- and top-leading markets. Gaining consumers’ trust for the third time will not be an easy feat. But perhaps the fundamentals are now much sturdier than they were in the company’s days in early 2016 and 2017, and if there’s a brand that can win over people three times over, it sure is Nokia.

Or who knows? Maybe we’ll only see low- and mid-range Nokia smartphones for many years. It’s a money-making strategy yet and you can’t break what has already worked. That would certainly be a shame, but if these budget smartphones helped bring the next billions of people online, why not? I enjoyed getting the Nokia as my first smartphone, and I’m sure others will too.