Wednesday, April 11, 2007


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Nokia Corporation
Type PublicOyj
Founded Nokia, Finland (1865)
Headquarters Espoo, Finland
Key people Fredrik Idestam, Founder in 1865
Kari Kairamo, CEO in the 1980s
Olli-Pekka Kallasvuo, President & CEO
Jorma Ollila, Chairman
Industry Telecommunications
Products Mobile phones
Multimedia computers
Mobile gaming devices
Enterprise Architecture
Wireless systems
Wireless data devices
Wireless voice devices
Wireless switching equipment
Revenue 41.121 billion (2006)[2]
Net income 5.488 billion (2006)
Employees 68,483 as of December 31, 2006[1]
Slogan Connecting People

Nokia Corporation (OMX: NOK1V, NYSE: NOK, FWB: NOA3) is currently the world's largest manufacturer of mobile telephones, with a global market share of approximately 36% in Q4 of 2006.[1] It produces mobile phones for every major market and protocol, including GSM, CDMA, and W-CDMA (UMTS).

The corporation also produces telecommunications network equipment for applications such as mobile and fixed-line voice telephony, ISDN, broadband access, voice over IP, and wireless LAN.

Nokia's headquarters are in Espoo, a neighbouring city of Helsinki, Finland, but it has R&D, manufacturing, and sales representation sites in many continents throughout the world. Nokia Research Center, the corporation's industrial research laboratories, has sites in Athens, Helsinki, Tampere, Oulu, Tokyo, Beijing, Budapest, Ulm, Bochum, Palo Alto, California, Bangalore and Cambridge, Massachusetts, USA. Major production factories are located at Salo Finland, Dongguan China, Chennai India, Komárom Hungary and Ruhr region at Germany. In March 2007 Nokia signed a memorandum with Cluj-Napoca City Council, Romania to open a new plant near the city [3] [4] [5], in Jucu commune. So far Nokia Design Departure has stayed at Salo Finland.

Nokia is by far the largest Finnish company, accounting for about half of the market capitalization of the Helsinki Stock Exchange (OMX Helsinki); a unique situation for an industrialized country. It also plays a very large role in the economy of Finland, and Finns have ranked it many times as the best Finnish brand and employer.



[edit] History

A closer view of the Nokia headquarters.
A closer view of the Nokia headquarters.

[edit] Pre-telecommunications era

What is known today as Nokia (pronounced /nok-iɑ/ in IPA) was established in 1865 as a pulp mill by Knut Fredrik Idestam on the banks of Nokia rapids. Finnish Rubber Works established its factories in the beginning of 20th century nearby and began using Nokia as its brand. Shortly after World War I Finnish Rubber Works acquired Nokia wood mills as well as Finnish Cable Works, a producer of telephone and telegraph cables. All these three companies were merged into the Nokia Corporation in 1967.

The Nokia Corporation that was created in the 1967 fusion was involved in many sectors, producing at one time or another paper products, bicycle and car tyres, footwear (including Wellington boots), personal computers, communications cables, televisions, electricity production, etc.

[edit] Telecommunications era

The seeds of the current incarnation of Nokia were planted with the founding of the electronics section of the cable division in the 1960s. In the 1967 fusion, that section was separated into its own division, and began manufacturing telecommunications equipment.

Since 1964 Nokia had developed VHF-radio simultaneously with Salora Oy, which later in 1971 also developed the ARP-phone. Fusion of these two companies resulted in 1979 as Mobira Oy and in three years it launched the NMT phone. Nokia bought Salora Oy in 1984 and now owning 100% of the company, changed the company's name to Nokia-Mobira Oy. In 1988 Jorma Nieminen and others started a spin-off company; Benefon Oy. One year later, Nokia Mobira Oy became Nokia Mobile Phones and in 1991 the first GSM phone was launched.

In the 1970s, Nokia became more involved in the telecommunications industry by developing the Nokia DX200, a digital switch for telephone exchanges. In 1982, a DX200 switch became the world's first digital telephone switch to be put into operational use. The DX200 became the workhorse of the network equipment division. Its modular and flexible architecture enabled it to be developed into various switching products.

For a while in the 1970s, Nokia's network equipment production was separated into Telefenno, a company jointly owned by the parent corporation and by a company owned by the Finnish state. In 1987 the state sold its shares to Nokia and in 1992 the name was changed to Nokia Telecommunications.

In the 1980s, Nokia produced a series of personal computers called MikroMikko.[6] However, the PC division was sold to ICL, which later became part of Fujitsu. That company later transferred its personal computer operations to Fujitsu Siemens Computers, which shut down its only factory in Finland (in the town of Espoo, where computers had been produced since the 1960s) at the end of March 2000[7], thus ending large-scale PC manufacturing in the country.

[edit] First mobile phones

Nokia had been producing commercial and military mobile radio communications technology since the 1960s and later began developing mobile phones for the Nordic Mobile Telephone (NMT) network standard that went online in the 1980s.

Nokia introduced its first car phone, the Mobira Senator, in 1982 and the world's first hand-held NMT mobile phone, the Mobira Cityman, in 1987. NMT was the world's first mobile telephony standard that enabled international roaming, and provided valuable experience for Nokia for its close participation in developing Global System for Mobile Communications (GSM). It is a digital standard which came to dominate the world of mobile telephony in the 1980s and 1990s, in mid-2006 accounting for about two billion mobile telephone subscribers in the world, or about 80% percent of the total, in more than 200 countries. The world's first commercial GSM call was made in 1991 in Helsinki over a Nokia-supplied network, by Prime Minister of Finland Harri Holkeri, using a Nokia phone.

In the 1980s, during the era of its CEO Kari Kairamo, Nokia expanded into new fields, mostly by acquisitions. In the late 1980s and early 1990s, the corporation ran into serious financial problems, a major reason being its heavily loss-making television division. (These problems probably contributed to Kairamo taking his own life in 1988.) Nokia responded by streamlining its telecommunications divisions, and by divesting itself of the television and PC divisions. Jorma Ollila, who became the CEO in 1992, made a strategic decision to concentrate solely on telecommunications. Thus, during the rest of the 1990s, Nokia continued to divest itself of all of its non-telecommunications divisions.

The exploding worldwide popularity of mobile telephones, beyond even Nokia's most optimistic predictions, caused a logistics crisis in the mid-1990s. This prompted Nokia to overhaul its entire logistics operation. Logistics continues to be one of Nokia's major advantages over its rivals, along with greater economies of scale.

[edit] In the new millennium

In 2004, the troubles of the networks equipment division caused the corporation to resort to similar streamlining practices on that side, with layoffs and organizational restructuring. This, however, diminished Nokia's public image in Finland, and produced a number of court cases along with an episode of a documentary television show critical towards Nokia.[8]

Despite these occasional crises, Nokia has been phenomenally successful in its chosen field. This growth has come mostly during the era of Jorma Ollila and his team of about half a dozen close colleagues. In June 2006, this era came to an end with Ollila leaving the CEO position to become the chairman of Shell. The new CEO of Nokia is Olli-Pekka Kallasvuo.

On February 2006 Nokia and Sanyo announced a MOU to create a joint venture addressing the CDMA handset business. A few months later, in June, both companies announced ending their negotiations without agreement. Nokia also stated their decision to pull out of CDMA R&D, with the intention to continue CDMA business in selected markets.[9]

On 19 June 2006 Nokia and Siemens AG announced the companies are to merge their mobile and fixed-line phone network equipment businesses to create one of the world's largest network firms. Both companies will have a 50% stake in the infrastructure company, to be headquartered in the Helsinki area, and to be called Nokia Siemens Networks. The companies predict annual sales of 16 billion and cost savings of €1.5 billion a year by 2010. About 20,000 Nokia employees will be transferred to this new company.

[edit] Product divisions

A Nokia shop in Würzburg, Germany.
A Nokia shop in Würzburg, Germany.

Nokia comprises four business groups: Mobile Phones, Multimedia, Enterprise Solutions and Networks, plus various horizontal entities such as Customer and Market Operations, and Technology Platforms.

[edit] Mobile Phones

Nokia's Mobile Phones division provides the general public with mobile voice and data products across a wide range of mobile devices. The division aims to target primarily high-volume category sales of mobile phones and devices, with consumers being the most important customer segment. The devices are based on GSM/EDGE, 3G/WCDMA and CDMA cellular technologies.

Nokia believes that design, brand, ease of use and price are mainstream mobile phones' most important considerations to customers. Nokia's product portfolio includes camera phones with features such as megapixel cameras and MP3 players which appeal to the mass market. In the first quarter of 2006 Nokia sold over 15 million MP3 capable mobile phones, this means that Nokia is not only the world's leading supplier of mobile phones and digital cameras (as most of Nokia's mobile telephones feature digital cameras), Nokia is now also the leading supplier of digital audio players (MP3 players). Nokia aims to sell 80 million music phones by the end of 2006, outpacing sales of devices such as iPods from Apple.[10]

[edit] Multimedia

The Multimedia division's purpose is to design devices and applications that bring multimedia experiences to their customers. These devices allow people to create, access and consume multimedia, as well as share their experiences with others. The devices are included with a wide range of connectivity such as GSM, 3G/WCDMA, WLAN and Bluetooth. Nokia Multimedia Nseries extensively uses Symbian OS.

The Multimedia group also works with other companies outside the telecommunications industry to make advances in the technology and bring new applications and possibilities in areas such as Internet services, optics, music synchronization and streaming media.

[edit] Enterprise Solutions

As the name implies, the Nokia Enterprise Solutions offers businesses, corporations and institutions a broad range of products and solutions, such as enterprise-grade mobile devices, underlying security infrastructure, software and services. Nokia also works with a range of companies to provide network security, bring mobilized corporate e-mail and extend corporate telephone systems to work with Nokia’s mobile devices.

[edit] Networks

Nokia Networks provides mobile network infrastructure, communications and networks service platforms, as well as professional services to operators and service providers. Networks focuses in: GSM, EDGE, 3G/WCDMA and WiMAX radio access networks; core networks with increasing IP and multiaccess capabilities; and services.

At the end of 2005, Networks had more than 150 mobile network customers in more than 60 countries, with its systems serving in excess of 400 million subscribers.

On 19 June 2006 Nokia and Siemens AG announced the companies are to merge their mobile and fixed-line phone network equipment businesses to create one of the world's largest network firms, called Nokia Siemens Networks.

[edit] Corporate affairs

[edit] Historical logos

[edit] Corporate governance

Group Executive Board
Olli-Pekka Kallasvuo (Chairman)
President and CEO of Nokia Corporation from June 1, 2006
With Nokia 1980-81, rejoined 1982, Group Executive Board member since 1990
Carl Belding
Executive Vice President, Chief Legal Officer
Joined Nokia 2007,
Robert Andersson
Executive Vice President, Customer and Market Operations
Joined Nokia 1985, Group Executive Board member since October 1, 2005
Simon Beresford-Wylie
Executive Vice President and General Manager of Networks
Joined Nokia 1998, Group Executive Board member since February 1, 2005
Mary T. McDowell
Executive Vice President and General Manager of Enterprise Solutions
Joined Nokia 2004, Group Executive Board member since 2004
Hallstein Moerk
Executive Vice President, Human Resources
Joined Nokia 1999, Group Executive Board member since 2004
Dr. Tero Ojanperä
Executive Vice President, Chief Technology Officer
Joined Nokia 1990, Group Executive Board member since January 1, 2005
Niklas Savander
Executive Vice President, Technology Platforms
Joined Nokia 1997, Group Executive Board member since April 1, 2006
Richard A. Simonson
Executive Vice President, Chief Financial Officer
Joined Nokia 2001, Group Executive Board member since 2004
Veli Sundbäck
Executive Vice President, Corporate Relations and Responsibility of Nokia Corporation
Joined Nokia 1996, Group Executive Board member since 1996
Anssi Vanjoki
Executive Vice President and General Manager of Multimedia
Joined Nokia 1991, Group Executive Board member since 1998
Dr. Kai Öistämö
Executive Vice President and General Manager of Mobile Phones
Joined Nokia 1991, Group Executive Board member since October 1, 2005
Board of Directors
Jorma Ollila (Chairman)
Chairman of the Board of Directors, Nokia Corporation
Board member since 1995, Chairman since 1999
Chairman of the Board of Directors of Royal Dutch Shell PLC
Paul J. Collins (Vice Chairman)
Board member since 1998, Vice Chairman since 2000
Georg Ehrnrooth
Board member since 2000
Member of the Personnel Committee, Member of the Audit Committee
Daniel R. Hesse
Board member since 2005
Chairman and Chief Executive Officer EMBARQ Corporation
Dr. Bengt Holmström
Board member since 1999
Per Karlsson
Board member since 2002
Independent Corporate Advisor
Dame Marjorie Scardino
Board member since 2001
Chief Executive and member of the Board of Directors of Pearson PLC
Keijo Suila
Board member since March 30, 2006
Vesa Vainio
Board member since 1993

Source: [11]

[edit] Corporate culture

Nokia's official corporate culture manifesto, The Nokia Way, emphasises the speed and flexibility of decision-making in a flat, networked organization, although the corporation's size necessarily imposes a certain amount of bureaucracy. Equality of opportunities and openness of communication are also stressed, along with management leadership and employee participation.

Nokia is a progressive and forward-thinking mobile technology group that spends a significant amount of its revenue on research and development, and prides itself on often being the first to market with new products and applications.

The official business language of Nokia is English. All documentation is written in English, and is used in official intra-company spoken communication and e-mail.

The Nokia Values are Customer Satisfaction, Respect, Achievement, and Renewal.

[edit] Trivia

Nokia headquarters in Keilaniemi, Espoo, Finland.
Nokia headquarters in Keilaniemi, Espoo, Finland.
  • Nokia was originally set up as a paper mill along the Nokianvirta River.
  • Unlike other modern day handsets, Nokia phones do not automatically start the call timer when the call is connected, but start it when the call is initiated. (Except for Series 60 based handsets like the Nokia 6600 and the N-Series)
  • The name of the town of Nokia originated from the river which flowed through the town. The river itself, Nokianvirta, was named after the old Finnish word originally meaning sable, later pine marten.
  • The native Finnish pronunciation of "Nokia" is [ˈ], i.e. stress on the first syllable and all vowels short. North American speakers of English often mispronounce the name as [ˈnoʊ.ki.ə] or [noʊˈkiː.ə] (putting the stress on the middle syllable).
  • The ringtone "Nokia tune" is actually based on a 19th century guitar work named "Gran Vals" by Spanish musician Francisco Tárrega. The Nokia Tune was originally named "Grande Valse" on Nokia phones but was changed to "Nokia Tune" around 1998 when it became so well known that people referred to it as the "Nokia Tune".
  • The ringtone "Special" is in fact morse code for "SMS". Likewise, the ringtone "Ascending" is morse code for "Connecting People", the company slogan.
  • Nokia is sometimes called aikon (Nokia backwards) by non-Nokia mobile phone users and by mobile software developers, because "aikon" is used in various SDK software packages, including Nokia's own Symbian S60 SDK.
  • Nokia sponsored several pan-European Alternate Reality Games from 1999 to 2005, under the name Nokia Game. These were used to promote their latest phones, as well as introducing the ARG format to Europe.
  • Nokia was listed as the 20th most admirable company worldwide in Fortune's list of 2006 (1st in network communications, 4th non-US company).[12]
  • Nokia is currently the world's largest digital camera manufacturer, as the sales of its camera-equipped mobile phones have exceeded those of any conventional camera manufacturer.
  • In the mobile phone market, Nokia is in direct competition with Motorola, Sony Ericsson, Samsung Electronics, LG, Philips, Kyocera, SAGEM, among others.
  • The Nokia corporate font (typeface) is the AgfaMonotype Nokia Sans font, originally designed by Erik Spiekermann. Previously in advertising and in its mobile phone User's Guides Nokia mostly used the Agfa Rotis Sans font.
  • In the first movie of The Matrix trilogy, the character of Neo (played by Keanu Reeves) used a Nokia 8110, modified with a spring loaded slider for dramatic effect (production units had manually operated sliders).
  • Nokia handsets are prominently featured and preferred on film and music videos, making the brand one of the heavy users of product placement.

[edit] See also

[edit] References and footnotes

[edit] Further reading

  • Michael Lattanzi, Antti Korhonen, Vishy Gopalakrishnan (2006). Work Goes Mobile: Nokia's Lessons from the Leading Edge. ISBN 0-470-02752-5 .
  • Christian Lindholm, Turkka Keinonen, Harri Kiljander (2003). Mobile Usability: How Nokia Changed the Face of the Mobile Phone. ISBN 0-07-138514-2 .
  • Martti Häikiö (2002). "Nokia: The Inside Story". ISBN 0-273-65983-9 .
  • Trevor Merriden (2001). Business The Nokia Way: Secrets of the World's Fastest Moving Company. ISBN 1-84112-104-5 .
  • Dan Steinbock (2001). The Nokia Revolution: The Story of an Extraordinary Company That Transformed an Industry. ISBN 0-8144-0636-X .

[edit] External links

Find more information on Nokia by searching Wikipedia's sister projects
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 Learning resources from Wikiversity

v d e
OMX Helsinki 25 companies of Finland

Cargotec | Elisa | Fortum | Huhtamäki | KCI Konecranes | Kesko | KONE | Metso | M-real | Neste Oil | Nokia | Nokian Tyres | Nordea AB | Orion |
Outokumpu | Outokumpu Technology | Rautaruukki | Sampo | SanomaWSOY | Stora Enso | TeliaSonera AB | TietoEnator | UPM | Wärtsilä | YIT

v d e
OMX Stockholm 30 companies of Sweden

ABB | Alfa Laval | Assa Abloy | AstraZeneca | Atlas Copco | Autoliv | Boliden | Electrolux | Eniro | Ericsson | Hennes & Mauritz |
Investor AB | Nokia | Nordea | Sandvik | SCA | Scania | SEB | Securitas | Skanska | SKF | Stora Enso | Svenska Handelsbanken |
Swedbank | Swedish Match | Tele2 | TeliaSonera | Volvo | Vostok Nafta |