Nokia is the world leader in the mobile telephone market and has 38% of the market shares. The telephone market witnessed a strong growth between 1990 and 2000. Today, it looks like the market is mature.
However, competition remains fierce. The phones tend to include many more sophisticated features and have also begun to exploit the internet. A serious competitor to Nokia,is Apple and they launched their iPhone in the third quarter of 2007. On August 29, 2007, Nokia announced the launch of several new internet services in its phones, by creating a new multimedia platform in collaboration with Ovi. Then Nokia announced its intention to acquire the map maker, Navteq, for 5.7 billion euros in early October.
This operation was a part of the diversification strategy that it initiated in September.
Tags - Nokia, Navteq, Apple, map maker
[...] The group will have to implement specific management processes to avoid conflicts arising from restructuring. This new structure is in harmony with the new strategy. Changing the organization of the company because of a new strategy is a sign of overall coherence of the strategy process. The leaders took into account the operational dimension in their strategic decision which was crucial. In conclusion, Nokia is committed to a strategic process for determining its performance and growth for the coming years. This is risky, if that works to provide sustainable positive group dynamics. [...]
[...] However, the Spanish operator Telefonica had agreed to offer Ovi services to its offerings. Maybe that other operators will see this change as a strategic opportunity rather than a threat. The decision to diversify into multimedia services can be analyzed from the perspective of portfolio management of SBU. Also, facing the SBU phone which is in the phase of maturity "cash cow", Nokia anticipates the possibility of a future decline by launching a new promising SBU; multimedia services. But it is also important to upgrade the skills and search for synergies (slide 9 chapters 6). [...]
[...] Development is still the most important element integral with the creation of the multimedia platform, Ovi. The acquisition for the moment makes the GPS service available on mobile phones. These methods involve a relatively low reversibility and a fairly high cost. Also, it is unlikely to be a test pilot, but rather a strong desire to expand into this market. Regarding the timing, Nokia is not the first to enter the market. It would thus be a follower strategy. From this, one must ask whether the learning process of Nokia will not be too long and will not penalize the brand against competitors like Apple who already entered the market of multimedia service. [...]
[...] However, competition is very fierce . Phones tend to include many options for more sophisticated and begin to exploit the Internet. Serious competitors of Nokia are Apple with the launch of its I-phone in Q Apple is currently the leading online music download platform with its iTunes. On August Nokia announced the launch of several new Internet services by creating a new multimedia platform under the brand Ovi. Then, the company announced in early October its intention to acquire mapmaker; Navteq for 5.7 billion euros. [...]
[...] Thus, one may question the relevance of this strategy of frontal attack. For this we must examine the internal and external features of Nokia. Nokia customers (operators) are currently experiencing a crisis rather serious. So, Nokia has anticipated and wanted to start a new business that complements its current offering an offering for good prospects for growth to avoid being trapped and suffer the difficulties of its customers. Like any market expansion strategy, this strategy sets out Nokia with new risks. [...]
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