Xi’an Jiaotong-Liverpool University
西 交 利 物 浦 大 学
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Name | Gao | (Surname) | Xiang | (Other Names) |
ID Number | 10113515 |
Programme | Financial Mathematics |
Module Title | Final Year Project (Phase 1) |
Module Code | MTH301 |
Assignment Title | An investigation and analysis of the factors that lead to Nokia’s declining market share. Lessons learned from Nokia’s decline. |
Submission Deadline | week 13, Thursday, 05th of ...view middle of the document...
Lessons learned from Nokia’s decline
This proposal will focus on formulating a strategy to complete the final year project. The topic of the project is “an investigation and analysis of the causes that lead to Nokia’s declining market share and give some advices of what can be learned from its decline”. The remainder of the proposal will give a brief description of the background information of the Nokia, the research objectives, literature review, research methods, and feasibility of the research.
The topic is interesting because the smartphone has become one of the necessities of our life nowadays. A recent article (Tree, 2013a) states that eighty percent of the people around the world own mobile phones, of which over one fifth are smartphones, which means there are more than one billion smartphones are being used. Through the smartphone, people can browse webpages, check emails, play games, and send short messages to communicate with other people (Tree, 2013b). In addition, Elyse Dupré (2013) reports that “the smartphones sold across the world increase over forty percent in 2012 compared with the quantity in 2011”. Nevertheless, as once the largest mobile phone maker around the world, Nokia even fell out of the top five global smartphone vendors now including Samsung, Apple, Huawei, Sony, and ZTE according to International Data Corporation(IDC) in quarter 4 2012.
What leads to the downturn of Nokia? It was stated in an article that “Nokia seems to have been owned as the first mobile phone for everybody” (Chris Silva, 2013). Therefore, the factors that lead to Nokia’s weakened position after its prosperity is appealing to study. Meanwhile, what can be learned from Nokia’s case will also be investigated. Some advices for Chinese mobile companies like Huawei, Lenovo and BBK will be considered as well.
In 1865, a mining engineer called Fredrik Idestam set up a wood pulp mill in Finland, and the second mill named Nokia Ab was built up after 6 years. After that the industry in which Nokia engaged in evolved from wood pulp and power generation, to rubber boots, tires, and until mobile phones (International Business, 2013). Nokia’s headquarter is located in Keilaniemi, Espoo in Finland (Collion, 2013), for which it creates thirty percent of the total GDP in 2008 (International Business, 2013). Furthermore, Nokia has been the leader of mobile vendors since 1996 for fourteen years (Awais Imran, 2011). However, the dominant position of Nokia is threatened as a consequence of the born of IPhone from Apple and other smart phones carrying Android operating system from Google in 2007. Additionally, it can be found that although Nokia still possesses about thirty percent of the market share from 2007 to 2010, its share of profits are dropping. On the other hand, Apple Inc. occupies over fifty percent of the total profits in the mobile market in 2010 (Economist online, 2011a). Nokia is not standing still, and it decide to...