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When Giants Transform: 3 Lessons Mobile Startups Should Learn From Nokia

This is the story of a giant.

Despite a long history of growth, adaptation, and resilience, something changed: Nokia fell into the hands of Microsoft. With a $7.5 billion acquisition, Microsoft officially purchased Nokia Devices and Services in April.

This signaled the end of a mobile dynasty. But this dynasty is one that all mobile startups can learn from.

The Rise and Fall of a Mobile Giant

Nokia’s history dates back to 1865, when Fredrik Idestam set up a wood pulp mill in Finland. By the 1900s, the company grew into a major conglomerate with its hands in rubber, forestry, cable, power generation, and electronics.

Nokia began experimenting with mobile technology in the ’60s, and by 1982, the company had introduced its first car phone.

Fast forward to 2003’s introduction of the Nokia 1100 handset. It became the bestselling mobile phone and consumer electronic of all time, contributing to Nokia’s rise and leadership in the realm of mobile technology.

But Nokia’s fall from telecommunications dominance was as fast as its rise. In 2011, Nokia reported heavy revenue losses, and by 2012, the company was rapidly laying off staff. Its acquisition by Microsoft this year indicated Nokia’s official end as a mobile leader.

The real question is: What can mobile startups learn from this giant’s dynasty?

Lessons for Mobile Startups

For mobile startups, seeing this major shift in the mobile industry might be scary. But here are some lessons they can learn from Nokia’s transformation:

1. Transform to remain relevant.

In the world of constantly changing technology and innovative solutions, mobile tech companies are practically thrown into “Survivor.” They have to continually think ahead and adapt to changes within the mobile industry.

Initially, Nokia was a great example of adapting to changing industries as it transitioned from leading the rubber industry to the cable industry, from the cable industry to electronics, and from electronics to telecommunications. When mobile tech peaked with the introduction of the iPhone in 2007, Nokia slowed down and fell behind.

2. Persistence and resilience are key.

This is not Nokia’s first time undergoing a major transformation. It was on the brink of bankruptcy in the 1910s as a rubber and cable manufacturer. To avoid failure,

Nokia merged with Finnish Cable Works to stay afloat. In 1967, the merger of Nokia, Finnish Rubber Works, and Finnish Cable Works formed an industrial conglomerate named Nokia Corporation. This merger eventually led to Nokia’s involvement in telecommunications. With each industry shift, Nokia managed to remain resilient until the mobile boom in 2007.

3. If you snooze, you lose.

Perhaps the biggest lesson to be learned from Nokia’s mobile saga is the importance of moving quickly and staying a step ahead of industry changes.

The iPhone changed the mobile movement, and after four years of trying to catch up, Nokia’s smartphone market share continued to plummet. In 2011, Nokia finally announced a strategic alliance with Microsoft. This partnership came a little too late, though. If Nokia had acted more quickly, it may have been able to continue as a major player in mobile tech.

Lessons to Learn From Nokia’s Biggest Competitors

Although Nokia’s lost the lead in the mobile tech game, several of its competitors have seen increasing success. Here’s what mobile startups can learn from them:

1. Apple: Nokia’s largest competitor was the one that got it right — and fast. Transitioning from personal computers to music players to smartphones, Apple paved the way for the mobile tech explosion. Rather than let the market lead it, Apple created the market. When you define the market, others have to play by your rules. This gives Apple a competitive advantage.

2. Google: Google was certainly intimidated by Apple’s rise, just like Nokia. A mobile world where consumers don’t always have access to a PC threatened Google’s desktop search dominance. To keep up, Google released Android in 2008. Android’s release was later than Apple’s iOS; by most accounts, it was still clunky and couldn’t compete. However, multiple updates later, Google proved it could keep up. Android is now the most popular operating system, and Google is leading the market in many areas of mobile UX.

3. Samsung: Samsung is an interesting case study — a company that didn’t just survive the feature phone-to-smartphone revolution, but thrived. In what has been coined by Businessweek as “The Samsung Way,” the company executes projects with “ferocious drive and speed.” Samsung is running with the digital appliances and television markets, in addition to its ever-changing smartphone endeavors. Samsung is driven by the concept of staying “at the forefront of core technologies” and mastering manufacturing. Although many tech companies have failed at this strategy, Samsung has demonstrated that fast, adaptable innovation is a winning strategy, with the right execution.

The biggest piece of advice mobile startups can take away from Nokia is this: You have to keep innovating. The world is changing, and it’s changing fast. Mobile startups must make sure their products, strategies, and company structures are just as agile and quick. In an industry that never sleeps, mobile startups must be a market maker wherever possible — not a market follower.

Ioannis Verdelis is the co-founder and COO of Fleksy, a revolutionary keyboard that makes typing on a touchscreen so easy you can type without even looking. Ioannis is a member of many entrepreneurial organizations, including the Young Entrepreneur Council, Empact Sphere, Startup America, and more. Connect with him on Twitter.

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