Nokia Pushes for U.S. Comeback

The three partners in the launch of the new Nokia (NYSE: NOK) Windows-powered Lumia 900 smartphone — AT&T (NYSE: T), Microsoft (NASDAQ: MSFT) and Nokia — were effusive about its chances to rival Apple’s (NASDAQ: AAPL) and Google’s (NASDAQ: GOOG) Android-based products.

Microsoft CEO Steve Ballmer said during the launch of the product at CES that, “The work Nokia is doing around Windows phone and this third ecosystem is really going to pay off.” It may be a third ecosystem, but it is a tiny one. And the comments violate one tenet of good business practice: underpromise and overdeliver.

CES is by it nature an “overpromise” environment. Companies large and small only have a few hours or a few minutes — or no time at all — to present their products at center stage with reviewers and press seated in rows. Nokia and its partners found it impossible to resist what is probably an exaggeration of the Lumia 900’s prospects.

The entire presentation of the product was carefully scripted. AT&T’s president of mobility, Ralph de la Vega, said, “I think Nokia is going to be back in the U.S. in a very big way.” What de la Vega neglected to mention is that his fortunes are based on Apple and Android products, along with a successful roll-out of AT&T’s 4G LTE network. The Lumia 900 cannot be a central part of his plans. AT&T Wireless has enough to occupy it already.

Senior managers of Microsoft, AT&T and Nokia also did not mention that the Lumia 900 is just one smartphone, and it is not the iPhone 4S. It also is not one of an army of successful smartphones from legions of manufacturers led by Samsung and HTC. Many of these Android-based devices work on 4G networks, which has driven, in part, their unusually successful adoption rates.

The Nokia Lumia 900 may be the best smartphone in the world, but it will become caught in the seas of competitors. Many of those rivals, despite the lessons of the BlackBerry, are almost too established to dislodge.

Douglas A. McIntyre