Are Nokia's mobile devices being pushed on to us, or is demand being driven by us?
July 27, 2003
By Max Gebhardt
Johannesburg - For those of us who thought that Nokia makes cellphones, you might be a little surprised that Nokia does not. It in fact makes mobile devices.
Voice, the company says, just happens to be one feature of a mobile device and just happened to be the first feature adopted for the cellphones. It is this thinking that drives the company's new vision "life going mobile".
"It's a great vision to have," said Pekka Ala-Pietila, the president of Nokia, to a briefing of journalists in Nokia's home town of Helsinki, Finland. The briefing is entitled Mobility 2003 and Beyond - a play on the line used by Tom Hanks's character, Buzzlightyear, in Toy Story.
But what sort of beyond is Nokia taking us to? And will we really want it when we get there?
At the moment Nokia is fairly certain that its consumers want three things on their phones: music, pictures and games. And with that comes e-mail, or, in the industry language, multimedia messaging services (MMS), an advanced form of data sending similar to the current SMS.
But the real revolution is video MMS. Currently you can do still MMS. In other words take a picture with your mobile device and send it to a friend. The next step is make a video with your mobile device and send it to your friend with music attached or a voice message.
From there it is a short leap to mobile operators selling you content. CNN on the phone - with clarity to match your television.
The future? Forget it, it's already here and it's coming soon to a phone near you.
But are these mobile devices being pushed on to us or is the demand being driven by us?
In this light, it is interesting that when Ala-Pietila talks about the future of Nokia and the company's vision of "life going mobile", he says Nokia needs to get three elements right.
"We have to win the hearts and minds of the consumers, master mobility, and get the right business model in place."
Initial market research in Japan, where it has been tested with the J-Power mobile operator, suggests there is a demand for mobile imaging and messaging.
So much so that Nokia found that a typical image mail user spent 53 percent more than those without the service, and those with video spent 91 percent more than non-video users.
In other words it is great business sense for Nokia and cellphone operators, and less perhaps about the hearts and minds. For them it is a win-win game. For the consumer of mobile device services it's about being enticed into spending more money.
As one Nokia executive said at the company's Salo factory, MMS offered "significant unexploited revenue potential for operators".
With that in mind should we be worried about the company's motives? Nokia argues that research has shown that users are enthusiastic about consuming and paying for mobile video services.
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