Nokia promises new products to exasperated investors

Nokia’s outgoing Chairman Jorma Ollila promised a range of new products ahead of a meeting on Thursday with shareholders who are increasingly losing patience with the company’s recovery efforts. In an interview published on Thursday, Ollila told the Financial Times the Finnish company would launch a range of tablets and “hybrid” smart mobile devices, but did not say when.

Ollila, who will step down at the meeting after 27 years with the company, told the Financial Times that Nokia had been too slow at the start of the smartphone revolution, but said the combination of new products and Nokia services would help. Nokia is widely expected to unveil its first tablet computer later this year when Microsoft’s new Windows 8 operating system becomes available.

“Nokia’s fate in tablets is directly linked to Microsoft, which also has to succeed in this space,” said Pohjola analyst Hannu Rauhala.

Nokia has lost out to Apple Inc and Google Inc in the smartphone business and is now pinning hopes of a turnaround on Lumia, a new range of smartphones which use Microsoft software. Once hailed as a national hero in Finland for transforming Nokia from a toilet paper-to-rubber boots conglomerate to the world’s No 1 cellphone maker in 1998, Ollila has since come under criticism for neglecting the emergence of smartphones.

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New devices are the only way to stay afloat

“Tablets are an important one, so that is being looked into, and there will be different hybrids, different form factors in the future,” he said.

Sales of Nokia’s new smartphone range have so far been slow and are yet to compensate for diving sales of previous products. Nokia also lost its position as the largest volume cellphone maker to Samsung Electronics last quarter.

Nokia executives are likely to face a grilling on these issues at Thursday’s meeting. Investors have seen the value of their Nokia holding fall 90 percent in less than five years – two-thirds of that since its new chief executive Stephen Elop unveiled the company’s strategy shift to Microsoft in February 2011.

Most attendees are likely to be individual shareholders as institutional investors usually do not come to such meetings. The meeting follows moves by ratings agencies Fitch and Standard & Poor’s to cut Nokia’s credit rating to “junk” status given its bleak outlook.

Ollila will hand over his role to Risto Siilasmaa after the shareholders meeting. In a poll published by national broadcaster YLE last week, around 40 percent of analysts following the company rated his 13 years’ work as chairman as ‘poor’ or ‘unacceptable’.

Reuters