In In its bid to compete with Android devices and Apples iPhone, Nokia Corp is shifting its programming efforts toward creating software for the low-end feature phones that the company sells in large numbers. After the failure of Symbian, the company has all but abandoned its ambitions in the market for OS for high-end mobiles.
Meltemi is the code name of Nokias project for the Linux-based operating system that will go into its feature phones. Mary McDowell, the handset makers executive vice president in charge of mobile phones, is leading the effort. Meltemi is Greek word for dry summer winds that blow across the Aegean Sea from the north.
Analysts are of the view that Nokias attempt to build its own software is a sign of the fact that value in the technology industry is shifting from hardware to software. In the past year, Android software has dominated the midrange smartphone market while Apple Inc.'s iPhone, which runs Apple's iOS software, has captured the high end.
Handset makers that have their own mobile OS tend to enjoy big advantages. They are in a better position to define their devices and make them stand out in the market. For Nokia, the low-end mobile phone business is crucial for survival. Feature phones accounted for about 47 percent of the company's device-and-services sales in the second quarter.
A new press release from Nokia states that the company was laying off as many as 3,500 people to align its workforce and operations. Most of the job cuts will be in manufacturing, as well as its Location & Commerce division. By the end of this year, Nokia will be closing its factory in Romania, and moving its manufacturing operations to suppliers in Asia.
The company is also decided to review the role of its manufacturing operations in Finland, Hungary and Mexico. Plans are in place to shift the focus of these operations from software and sales. It will close its Location & Commerce operations in Bonn, Germany and Malvern, USA, too.
In an official statement, Nokia, CEO Stephen Elop, said, We must take painful, yet necessary, steps to align our workforce and operations with our path forward.
Nokias low end phone business is in trouble as the touch-screen Android phones are becoming cheaper, and the emerging markets which previously consumed Nokias feature phones are now looking for the next step up: touchscreen capability and better Internet browsing. Indications are the touchscreen interface used in Nokias N9 smartphone could eventually find its way into the companys feature phones.
However, it is still not clear how successful Nokia will be with its Meltemi OS.
For high-end smartphones Nokia already has a partnership in place with Microsoft, in which Windows Phone OS will run on all future high-end devices. It is not clear when the first Windows powered Nokia phone will arrive, but it is widely expected to at the end of this year.
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