Now that the news about Nokia X is out, we can explore it in greater depth. There are five points to look at — the Nokia X product, its pricing, platform, intended market and that it comes with Opera Mini already installed. Of these, it is the intended market that most acutely differentiates the Nokia X product line as big news.
I’ve been watching and waiting for news like since about 2005. That’s when Nicholas Negroponte with the MIT Media Lab unveiled plans at Davos, Switzerland for a $100 laptop and established the One Laptop per Child initiative. What Nokia is doing with its latest product line can be equated to providing the power of a laptop to adults for $100. We are talking about a mobile device and not a laptop. The Nokia X of today is as powerful, functional, more portable than a laptop from a decade ago — and exponentially more affordable.
Nokia is targeting Asia-Pacific, Europe, India, Latin America, the Middle East and Africa, representing about 80% of the world’s population. Large portions of each of these markets either don’t have a mobile device or are very slow in upgrading their older devices. India’s lifespan for a mobile phone is between 8 – 10 years, on average.
This is a perfect snapshot of what it takes to bridge the “Digital Divide” — between those who have Internet access and those who do not. The marketing strategy itself is clear cut — provide a good product at a good price to people who don’t have it, but who likely want or need it. That, or try selling a 3rd, 4th or 5th mobile device to a population that already has 2 or 3 others laying around.
Nokia deserves a huge round of applause for being among the first to tackle the challenge of emerging markets. A study by GSMA (Groupe Speciale Mobile Association) shows that, “A 10% increase in mobile penetration increases Total Factor Productivity in the long-term by 4.2%.” Their report further finds that, “10 more mobile phones per 100 people would increase GDP per capita growth by up to .6%,” continuing that in developing economies, the impact is between .8 and 1.2%. I would assert that the longer-term impact is far greater as there is an accelerating and cascading effect that is difficult to measure except in 10 and 20 year cycles (as with Singapore and Hong Kong).
This is really part of a preface to a much extended discussion which I hope and intend to begin next week. Most techies will tend to see Nokia X as just another mobile device. Nokia X is about a whole helluva lot more than just a mobile device, but accelerating the process of adding 1+ billion more people to the Internet.
Nokia X is a major Tipping Point. Look at it this way, the One Laptop per Child program, despite being supported by some of the big names in Davos and backed by MIT, has delivered about 2.7 million laptops. There are over a billion Nokia devices in circulation – so, the breadth and depth of its logistical capabilities plus Nokia’s market reach is a game changer. It will also generate greater competition for the emerging market.
The Nokia X Product and Pricing — essentially we are talking about the Nokia X (89 €/$122), Nokia X+ (99 €/$136), and Nokia XL (109 €/$150). Two more devices were announced in the same press release – the Nokia 220 – an Internet-ready mobile phone with social apps (29 €/$40) and the Nokia Asha 230 — a full-touch Asha device (45 €/$62). See product details for full specifications.
The Nokia X line is not trying to compete with mid or upper tier devices, but it is delivering a lot more “ready to go” for first time mobile users than one might expect with the price. Dollar to Euro pricing is subject to considerable fluctuation, so I am exaggerating slightly when comparing it to a $100 laptop. They have more than enough computing power than NASA did to put a man on the moon. It’s all a matter of perspective… and purchasing power parity.
As it is a product line focusing on a low price tier, talking up its features amongst an audience that has the latest and greatest would miss the mark. We’re talking about functionality for a large audience who has not had it before and in many cases where electricity, running water and functional toilets are in less supply. What we take for granted in the West is the envy of entire populations. That deserves its own series of articles unto itself.
The Nokia X platform. First, let me point you to Nokia’s official press-release — extracting a few key points here:
“… Based on the Android Open Source Project (AOSP), and backed by Nokia’s deep ties with operators, the Nokia X platform gives Android(TM) developers the chance to tap into, and profit from, a rapidly expanding part of the market. The launch builds on Nokia’s leadership in delivering innovation to more price points with its family of Lumia smartphones, and the latest momentum for Windows Phone.”
“With billing agreements in more than 60 markets and with more than 160 operators, Nokia provides developers with access to one of the largest mobile operator billing network in the world, offering the scale and global reach needed to successfully monetize their apps and generate higher revenues.”
“The reach of Nokia’s operator billing network provides developers with a powerful revenue driver – up to five times that of credit-card billing offered within other platforms,” said Amit Patel, Vice President, Developer Relations at Nokia. “Combined with Nokia In-App Payment, developers have the freedom to build on the model that works best for them.”
Functionally, I see this as adding diversification to what has tended to be a US-centric market (i.e. Apple and Google). That’s generally a good thing, especially in relation to Nokia having pre-installed Opera Mini on the Nokia X product series.
For developers who only want to be concerned about being on one or two of the biggest stores – that’s probably bad news. But, for everyone else interested in a “free market” (which conveys multiple layers of meaning), it is some of the best news for the mobile market since the days of Adam Smith. It is also a step in the direction of “mobile convergence” in that Nokia is looking at both Android and Windows Phone in relation to its own product line, which owing to existing marketing mechanisms, appears to require some product segmentation. Or to skip the hyberbole, Nokia’s version of Android appears to require some adjustments by developers – but I stand open for correction on that.
Obviously, for Opera and Opera Mobile Store, this is (in the words of Jeff Spacoli), “Awesome, Totally Awesome!” It emphasizes Opera Mini’s ability to reduce bandwidth strain for both Operators and End-Users. This harkens back to the Internet.org initiative and Mark Zuckerberg’s recent comments and Facebook’s August 2013 Press Release — surprise! surprise!
“Nokia is deeply passionate about connecting people – to one another and the world around them,” said Nokia President and CEO Stephen Elop. “Over the years, Nokia has connected well over a billion people. Our industry is now at an exciting inflection point where Internet connectivity is becoming more affordable and efficient for consumers while still offering them great experiences. Universal internet access will be the next great industrial revolution.”
“Today, more than 300 million people use Opera every month to access the Internet. Tomorrow, we have a chance to serve the next 5 billion people connecting on mobile devices in developing countries. It’s in Opera’s DNA to save people time, money and data, and through internet.org we think we can help advance these goals.” — Lars Boilesen, CEO Opera Software.
Five small points — product, price, platform, market, and of course, Opera’s role in it. I realize… that I’m sort of all over the place in trying to cover these five points. All five points are interconnected and their focus is on The Market. We’ll get into more of that on Friday – and likely all of next week.