Randy Arnold's Blog

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In a press release yesterday, Nokia informed its customers that its Ovi services would be folded back into the Nokia brand.  Is this simply an admission of brand evangelism failure, or the prelude to further, more significant business changes?

Ovi History

Publicly launched as a brand in late 2007, Ovi was intended to be a comprehensive collection of web and device services/applications with an emphasis on mobility.  Nokia at the time began referring to itself as an “Internet company” although some, including employees such as myself, were never clear on just what that meant.

Perhaps Nokia executives weren’t, either.  Ovi services have been in perpetual beta and never seemed to enjoy the level of support the solution set needed in order to compete.  But who was Ovi competing against?  In some ways, Google, Microsoft, Yahoo and even cell phone service carriers.  The chimeric Ovi struggled to find acceptance as a unified brand because too many customers and partners only wanted certain pieces of it, unwilling to give up their own equivalent offerings.

Crack in the Door

First to fall in the Ovi stable was Ovi Files, the web-hosted file replication part.  This is certainly a compelling service for mobile and desktop customers, and cloud-based solutions are steadily gaining traction (despite the occasional major outage) so it wasn’t as if Nokia erred in putting it out there.  But monetizing consumer web storage has been tricky, at least partly due to figuring out a reasonable subscription fee.  After its acquisition from Avvenu, the Ovi Files service went from a paid premium to free model, perhaps to position Files as a loss-leader to draw customers in to other premium services.  Why was it discontinued?  Shane McLaughlin of Nokia stated that Files was at some point evaluated as not fitting in with their evolving business model.  Given that they also offer dedicated media storage solutions, this can be understood.

There have been various misfires, delays and other frustrations involving every piece of Ovi, but none likely more aggravating to users than the Nokia-to-Yahoo Ovi mail migration.  Some disruption was to be expected, and Nokia did a great job keeping customers notified of the impending change and then its progress.  I had no problem with being unable to access legacy Inbox contents and was well-prepared for it.  What I wasn’t ready for was that email would be completely inaccessible via the web client for two weeks.  Let me clarify: emails would load, but I could do nothing with them– not even read.  When that was finally resolved, I received another rude awakening: full IMAP support was removed once the mail service moved to Yahoo.  This meant going to POP, which typically cleans emails off of the server once they are downloaded to a local reader.  POP doesn’t cut it for mobile email; users need to feel confident that they can access the same content via smartphone, laptop, desktop or what-have-you.  It doesn’t help that Ovi site documentation is out of date.  On a positive note, the web client has been behaving the past few days as if full IMAP is there again, but I need to confirm.

Another plus is that Ovi Maps has been, for the most part, a stellar success.  Even as other parts of Ovi struggled and stumbled to escape the beta black hole, Maps consistently added feature after feature.  True, the N900 implementation came up short, contrary to some puzzling, glowing reviews– but I’m focusing on the main line.

Name or Game Change?

Now Nokia shifts gears once again, rebranding Ovi services with the Nokia name.  This seems to be a concession that “Ovi by Nokia” failed to resonate as a sub-brand.  One can argue the value of pulling service branding closer to the core, but sub-branding has been either an outright success or a non-issue at least for many other consumer brands.  Consider for example US-based General Motors, which for decades had no problem managing several sub-brands under its umbrella.  But perhaps this is easier to pull off for hard goods than for services… especially if the owning brand seeks to sell those services beyond its own borders.

To make matters more interesting, technology gadfly Eldar Murtazin is at his rumor-pushing best again, this time claiming that the recent Microsoft-Nokia partnership is a first step to something more astounding.  With the signature ink still wet on the device-contracting agreement, the two companies are supposedly negotiating the sale of Nokia’s handset business, in whole or part.

Such a move could conceivably pare Nokia down to little more than a service, or Internet, company after all.  Thus, more closely identifying services with the company name would make sense, especially to trade customers.  Would, say, T-Mobile really want to put out something like “the T-Mobile Model XXX phone with Ovi by Nokia”?  Too much for consumers to chew on.  Cropping off “Ovi” tidies things up immediately.

IF Eldar is correct on this one, the move would be profound.  In essence, it would signal a monumental sea change for both companies, each shifting dramatically from one core business toward its polar opposite.  Microsoft would be extending its Xbox and peripheral businesses to become more of a hardware company, while Nokia could become a more virtual version of itself.  Nothing new in Nokia’s case, but for Microsoft it would be another acknowledgement that its desktop consumer and business software segment are falling victim to consumer mobilization.

Door Half Open or Half Closed?

I tried as both a Nokia employee and later as pure consumer to support and offer feedback on Ovi services.  I was a hardcore user of Ovi Mail especially but the Yahoo debacle left a sour taste in my mouth.  I’m in the process presently of migrating over to a new email address associated with my skimpy vanity site.

I still want to see the original idea succeed, but I’m thinking more and more that it will do so in a very different way than first presented.  Will that be due to another revolutionary business change at Nokia, or something more evolutionary?  And how will the changes enabled by HTML5 play into Nokia’s web service plans?  Right now all anyone outside Nokia House can do is speculate, but I guess we’ll know something by the end of this year.  Stay tuned!