hello everybody tom Ellsworth welcome
back to case studies this is where you
can learn things that happen to other
companies and apply them to yourself
today’s topic is Nokia and we’re going
to learn two things today the first is
to know the difference between
confidence and hubris when you’re being
successful and you’re growing and moving
along and the second point is to
understand and have it in your heart
that what got you here won’t get you
there and we’re going to apply those two
points and I’m going to show you how you
can use them learning what happened to
Nokia so let’s go Nokia is one of my
favorites because it’s a it’s a handset
maker and I came from the wireless
industry early in my career so I know a
lot about this industry and it’s one of
my favorite case studies even though it
really kind of had a sad ending for a
lot of people and employees but it is
what it is and it’s made something that
we can all learn from
so Nokia started believe it or not as a
paper mill back in the 1800s and somehow
between then and you know in 1990 they
got into wireless phones and they
started making phones really high
quality little phones for you and me
basic bones no innovation their
innovation was that they could make
millions and millions of phones every
month make them very inexpensively and
ship them anywhere that’s what they did
style function innovation in the future
that wasn’t there set of cards make them
really good make them simple make them
small and get them at a low price to you
and me and quite often we got them for
free remember those days you get a
two-year contract and get your loan
okiya phone away you want along the way
though some things happen that’s what
we’re going to learn about in the great
confidence of being able to dominate an
industry by 1998 they had 52% global
market share cranking out millions and
millions of phones every month they were
very confident they were very bold in
that and I knew people at wireless
carriers used to say they used to
negotiate really tough with them and
they were a force to be reckoned with
and so they had a lot of confidence and
what we would soon find out is that
confidence was hubris the difference
between confidence in hubris you
be confident going out to play a game or
do something hubris thinks you’ve
already won before you got there and
you’re cocky and that means you can get
caught by surprise and that’s exactly
what happened to Nokia when life started
moving toward content you know I know a
little bit about content because in 2001
I was working at Sprint and I was
running a wireless incubator or sprint
with help from Qualcomm and actually
Qualcomm’s right here on my shirt
they make chips for phones lots and lots
of chips and they were foreseeing a
future where our phones would be doing
so much sprint knew about that in this
incubator we were helping build little
companies that would build stuff that
the consumer would use tomorrow one of
those was wireless games and a little
company named jammed at mobile was
funded in that Wireless incubator I was
fortunate enough to actually leave
Sprint and join jammed at mobile and
join those founders and go on a run and
while we were building content for the
future it was very interesting companies
like Samsung and Motorola were starting
to build bigger phones and taking
advantage of Qualcomm’s really cool
chips and put bigger batteries into them
so they could do more and jam that we
made a great game called jammed at
bowling and between 2002 and 2003 we
sold millions of copies of jammed up
bowling along that same time we uh
noticed Nokia who had I had known as
this giant knee industry all they were
really doing was they made the battery a
little bigger they added a color display
but they really didn’t get with the
program in terms of content they were
trying to wedge certain features into
all their old little phones for his
Motorola I don’t know if some of you
remember built this thing called the
Razer which was one of the greatest most
popular phones had a big screen on it
and easy to use Menu key made it perfect
for playing games texting and doing all
these cool things and mobile phones were
now being able to do meanwhile Nokia
stuck with their little we used to call
them candy bar phones little basic
little phones and they just weren’t with
the program and actually they were kind
of a pain in the neck to work with
because we’re trying to make our content
and game
teams that jam that do all these really
cool things on phones and unfortunately
you had a Nokia phone where you just
couldn’t do too much with it and so that
was a I kind of saw and everybody in the
industry saw that there was going to be
big changes for Nokia and they were a
giant a big giant that giant sometimes
it was tough to deal with they
negotiated really tough with wireless
carriers and they were also you know
they could if you needed millions of
phones to sell they could get you the
millions of phones to sell and if you
didn’t have any phones to sell you know
you were screwed so in a lot of ways you
had to work with them but they weren’t
evolving to the future and I saw it a
lot of people saw it and I don’t think
Nokia saw it or if they did see it they
weren’t paying attention and they had
such hubris and confidence in their
position that they missed it let’s go
take a look a little chart I made
because I’ll tell you what happened
interior in 2007 and Nokia has got 52
percent market share and guess what
happens sitting there in 2007 the iPhone
yeah my crude attempt at an Apple logo
but there’s the iPhone gets it
introduced and if you’re in the United
States you remember that it was
introduced through one just one carrier
and people thought wow that’s a really
cool phone those of a certain making
content we knew that was the future what
was really interesting is there was a
little company you may remember called
danger that made a very very interesting
phone that t-mobile had been able to get
into the hands of celebrities and it was
called the danger to you I don’t know if
you remember it but ultimately Google
says I’m going to get into this game and
the way I’m going to get in I’m going to
by danger so here you have Google not a
mobile phone company not a mobile
software company buying danger to get in
the game
well Nokia really wasn’t doing anything
they were putting color in it they knew
content was important but when you
looked at their product line they really
didn’t get there and so what they didn’t
realize is what gets you here the
ability to make all these phones and
make them fast and make millions of them
isn’t going to get you there a new world
order we’re
content is king and you need storage you
need bigger displays and you need
features so that you and me could do so
much more with getting to the internet
playing games doing all these things
well what got you there isn’t going to
get you over here and Nokia found out
the hard way this is a little chart here
I drew but this is really what happened
to their market share between o7 and in
2012 Nokia’s market share went from 52
percent all the way down to 2 percent
and here comes the Android guy and here
comes multiple versions of the iPhone
and you just can’t think of an industry
where somebody that had built up to such
a dominant position was just gone in
such a short amount of time I think that
if you really you know look back you
know now you can say oh everybody saw it
coming but then you say to yourself
Nokia had smart people and the answer
was they just had a lot of corporate
hubris about who they were they whiffed
they didn’t you know buy companies where
they had opportunities to make me buy
companies that would get them there and
they just missed on the content deal in
the ending of the story is in 2014
Microsoft actually bought what was left
of Nokia and I say what was left because
they paid 7.2 billion dollars for it and
after they bought it one year later with
market share having dropped down again
they actually wrote it off for seven
point six billion let me give you those
two numbers they bought it for 7.2 and
then they wrote it off for 7.6 which
means he made other investment after
they bought it and Microsoft was like
wow that year was a bad dream and that
was it and then Nokia’s brand and a few
patents were sold to an offshore company
and if you look around you can see a few
Nokia phones because that little company
is trying to do it but big Nokia they’re
gone
this year when they have 52 percent
market share they sold more than 450
million phones half billion phones
almost half a billion phones
two gone bought by Microsoft and then
written off when Microsoft bought Nokia
everybody including Steve Ballmer who
now owns the Clippers was very excited
they thought that all that Nokia
technology and what they were doing was
going to add to Microsoft Windows Phones
and we know the Microsoft Windows Phones
never got any sort of traction in 2016
when it all came to a head and it was
done there was this press conference and
the CEO of Nokia was seen there actually
crying and saying you know we didn’t do
anything wrong and somehow we lost you
know that really bothered me when I saw
it because I said to myself wait a
minute
you did do something wrong you you
forgot that life doesn’t stand still and
you were cocky you had a lot of hubris
when you dealt with all the wireless
carriers and here you’re saying I didn’t
do anything wrong
I just lost really what she did wrong
was you failed to understand content
what you did wrong was you
underestimated competition you
underestimated Google it wasn’t even in
mobile phones buying a company called
danger and building the Android
operating system you missed that yet you
had the kind of clout and the kind of
dollars you could have done that you
could have made that move so to sit
there and cry and say we didn’t do
anything wrong but somehow we lost I
just can’t go with that that’s hubris
and that’s denial and I think that just
underlines that Nokia didn’t understand
that what gotcha here can’t get you
there and they were full of hubris and
they missed all the signs too terrible
consequence because 7800 people lost
their jobs and that’s a huge tragedy so
that’s the Nokia case study I hope you
got something out of that and comply it
to yourself now I need a pillow I think
I need the magic pill oh here we go
if you like this please come to value
tainment to see more case studies and to
see the best content on the internet for
entrepreneurs featuring Patrick bet
David please subscribe here on YouTube
and until next time with more case
studies I’m Tom Ellsworth and I hope I
left you better than I found you
you [Music]
back to case studies this is where you
can learn things that happen to other
companies and apply them to yourself
today’s topic is Nokia and we’re going
to learn two things today the first is
to know the difference between
confidence and hubris when you’re being
successful and you’re growing and moving
along and the second point is to
understand and have it in your heart
that what got you here won’t get you
there and we’re going to apply those two
points and I’m going to show you how you
can use them learning what happened to
Nokia so let’s go Nokia is one of my
favorites because it’s a it’s a handset
maker and I came from the wireless
industry early in my career so I know a
lot about this industry and it’s one of
my favorite case studies even though it
really kind of had a sad ending for a
lot of people and employees but it is
what it is and it’s made something that
we can all learn from
so Nokia started believe it or not as a
paper mill back in the 1800s and somehow
between then and you know in 1990 they
got into wireless phones and they
started making phones really high
quality little phones for you and me
basic bones no innovation their
innovation was that they could make
millions and millions of phones every
month make them very inexpensively and
ship them anywhere that’s what they did
style function innovation in the future
that wasn’t there set of cards make them
really good make them simple make them
small and get them at a low price to you
and me and quite often we got them for
free remember those days you get a
two-year contract and get your loan
okiya phone away you want along the way
though some things happen that’s what
we’re going to learn about in the great
confidence of being able to dominate an
industry by 1998 they had 52% global
market share cranking out millions and
millions of phones every month they were
very confident they were very bold in
that and I knew people at wireless
carriers used to say they used to
negotiate really tough with them and
they were a force to be reckoned with
and so they had a lot of confidence and
what we would soon find out is that
confidence was hubris the difference
between confidence in hubris you
be confident going out to play a game or
do something hubris thinks you’ve
already won before you got there and
you’re cocky and that means you can get
caught by surprise and that’s exactly
what happened to Nokia when life started
moving toward content you know I know a
little bit about content because in 2001
I was working at Sprint and I was
running a wireless incubator or sprint
with help from Qualcomm and actually
Qualcomm’s right here on my shirt
they make chips for phones lots and lots
of chips and they were foreseeing a
future where our phones would be doing
so much sprint knew about that in this
incubator we were helping build little
companies that would build stuff that
the consumer would use tomorrow one of
those was wireless games and a little
company named jammed at mobile was
funded in that Wireless incubator I was
fortunate enough to actually leave
Sprint and join jammed at mobile and
join those founders and go on a run and
while we were building content for the
future it was very interesting companies
like Samsung and Motorola were starting
to build bigger phones and taking
advantage of Qualcomm’s really cool
chips and put bigger batteries into them
so they could do more and jam that we
made a great game called jammed at
bowling and between 2002 and 2003 we
sold millions of copies of jammed up
bowling along that same time we uh
noticed Nokia who had I had known as
this giant knee industry all they were
really doing was they made the battery a
little bigger they added a color display
but they really didn’t get with the
program in terms of content they were
trying to wedge certain features into
all their old little phones for his
Motorola I don’t know if some of you
remember built this thing called the
Razer which was one of the greatest most
popular phones had a big screen on it
and easy to use Menu key made it perfect
for playing games texting and doing all
these cool things and mobile phones were
now being able to do meanwhile Nokia
stuck with their little we used to call
them candy bar phones little basic
little phones and they just weren’t with
the program and actually they were kind
of a pain in the neck to work with
because we’re trying to make our content
and game
teams that jam that do all these really
cool things on phones and unfortunately
you had a Nokia phone where you just
couldn’t do too much with it and so that
was a I kind of saw and everybody in the
industry saw that there was going to be
big changes for Nokia and they were a
giant a big giant that giant sometimes
it was tough to deal with they
negotiated really tough with wireless
carriers and they were also you know
they could if you needed millions of
phones to sell they could get you the
millions of phones to sell and if you
didn’t have any phones to sell you know
you were screwed so in a lot of ways you
had to work with them but they weren’t
evolving to the future and I saw it a
lot of people saw it and I don’t think
Nokia saw it or if they did see it they
weren’t paying attention and they had
such hubris and confidence in their
position that they missed it let’s go
take a look a little chart I made
because I’ll tell you what happened
interior in 2007 and Nokia has got 52
percent market share and guess what
happens sitting there in 2007 the iPhone
yeah my crude attempt at an Apple logo
but there’s the iPhone gets it
introduced and if you’re in the United
States you remember that it was
introduced through one just one carrier
and people thought wow that’s a really
cool phone those of a certain making
content we knew that was the future what
was really interesting is there was a
little company you may remember called
danger that made a very very interesting
phone that t-mobile had been able to get
into the hands of celebrities and it was
called the danger to you I don’t know if
you remember it but ultimately Google
says I’m going to get into this game and
the way I’m going to get in I’m going to
by danger so here you have Google not a
mobile phone company not a mobile
software company buying danger to get in
the game
well Nokia really wasn’t doing anything
they were putting color in it they knew
content was important but when you
looked at their product line they really
didn’t get there and so what they didn’t
realize is what gets you here the
ability to make all these phones and
make them fast and make millions of them
isn’t going to get you there a new world
order we’re
content is king and you need storage you
need bigger displays and you need
features so that you and me could do so
much more with getting to the internet
playing games doing all these things
well what got you there isn’t going to
get you over here and Nokia found out
the hard way this is a little chart here
I drew but this is really what happened
to their market share between o7 and in
2012 Nokia’s market share went from 52
percent all the way down to 2 percent
and here comes the Android guy and here
comes multiple versions of the iPhone
and you just can’t think of an industry
where somebody that had built up to such
a dominant position was just gone in
such a short amount of time I think that
if you really you know look back you
know now you can say oh everybody saw it
coming but then you say to yourself
Nokia had smart people and the answer
was they just had a lot of corporate
hubris about who they were they whiffed
they didn’t you know buy companies where
they had opportunities to make me buy
companies that would get them there and
they just missed on the content deal in
the ending of the story is in 2014
Microsoft actually bought what was left
of Nokia and I say what was left because
they paid 7.2 billion dollars for it and
after they bought it one year later with
market share having dropped down again
they actually wrote it off for seven
point six billion let me give you those
two numbers they bought it for 7.2 and
then they wrote it off for 7.6 which
means he made other investment after
they bought it and Microsoft was like
wow that year was a bad dream and that
was it and then Nokia’s brand and a few
patents were sold to an offshore company
and if you look around you can see a few
Nokia phones because that little company
is trying to do it but big Nokia they’re
gone
this year when they have 52 percent
market share they sold more than 450
million phones half billion phones
almost half a billion phones
two gone bought by Microsoft and then
written off when Microsoft bought Nokia
everybody including Steve Ballmer who
now owns the Clippers was very excited
they thought that all that Nokia
technology and what they were doing was
going to add to Microsoft Windows Phones
and we know the Microsoft Windows Phones
never got any sort of traction in 2016
when it all came to a head and it was
done there was this press conference and
the CEO of Nokia was seen there actually
crying and saying you know we didn’t do
anything wrong and somehow we lost you
know that really bothered me when I saw
it because I said to myself wait a
minute
you did do something wrong you you
forgot that life doesn’t stand still and
you were cocky you had a lot of hubris
when you dealt with all the wireless
carriers and here you’re saying I didn’t
do anything wrong
I just lost really what she did wrong
was you failed to understand content
what you did wrong was you
underestimated competition you
underestimated Google it wasn’t even in
mobile phones buying a company called
danger and building the Android
operating system you missed that yet you
had the kind of clout and the kind of
dollars you could have done that you
could have made that move so to sit
there and cry and say we didn’t do
anything wrong but somehow we lost I
just can’t go with that that’s hubris
and that’s denial and I think that just
underlines that Nokia didn’t understand
that what gotcha here can’t get you
there and they were full of hubris and
they missed all the signs too terrible
consequence because 7800 people lost
their jobs and that’s a huge tragedy so
that’s the Nokia case study I hope you
got something out of that and comply it
to yourself now I need a pillow I think
I need the magic pill oh here we go
if you like this please come to value
tainment to see more case studies and to
see the best content on the internet for
entrepreneurs featuring Patrick bet
David please subscribe here on YouTube
and until next time with more case
studies I’m Tom Ellsworth and I hope I
left you better than I found you
you [Music]
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