Nokia can't rely on megapixels alone

Nokia’s new phone, the Lumia 1020, is grabbing headlines for a 41 megapixel camera. But the company still has serious hurdles to jump if it has any chance of reclaiming its former glory.

Technically impressive and pretty though it is, since ditching Symbian – and much of its staff – Nokia has been tightly anchored to Microsoft’s Windows Phone OS. Having Stephen Elop at the helm, it seemed like it couldn’t have gone any other way, and executives previously admitted they considered Android but decided to bet the farm on Microsoft.

Since the alliance started, Nokia has put out some gorgeous looking hardware, and its smartphones have generally been well received. But even pop-up collaborations with techno-rodent Deadmau5 haven’t been able to win the world to its brand, and those that do buy the phones will be disappointed when they realise there’s not as much, compared to iOS and Android, they can do with them.

Ovum’s Tony Cripps points out the Lumia 1020 demonstrates Nokia’s fantastic capabilities in R&D and design, and that the device really does raise the bar in terms of imaging and audio experiences. But these features will have to be offset by pricing.

“The device will be expensive,” Cripps says. “Pricing has yet to be revealed but engineering of the kind on offer in the 1020 does not come cheap. Aggressive operator subsidies would no doubt help, but might detract from the device’s premium engineering and user experience”.

Microsoft has had problems getting developers over to Windows Phone for some time now, trying every trick in the book including the simple hard cash. The whole ecosystem is still lacking.

IHS’ mobile analyst, Daniel Gleeson, told TechEye that the relatively small ecosystem “does hurt Nokia and in particular, the lack of Instagram, Vine and Snapchat”.

A large problem facing Nokia is branding. It’s “no longer seen as cool or premium in Europe,” Gleeson says, “and the brand essentially doesn’t exist in North America at all”.

Gleeson notes that the ecosystem is improving, and the close relationship between Windows Phone 8 and Windows 8 should help address these problems. However, “most of these key apps are built by US developers for the US market,” he tells us. “Unless Nokia and Windows Phone is able to make a breakthrough in North America, the ecosystem problem will never be solved”.

One thing is clear – throwing cash at a brand does not necessarily make the brand.

Nokia’s gone nuts on spending and promotional events, but so did Intel with its Ultrabooks. There seems to be a missing ingredient for Nokia devices, and if it does not figure out what that is, it will continue to play a game of one-upmanship against itself while Android and iOS hog the limelight.

Still, the 1020 shows Nokia’s got some fighting spirit yet, and that the company is dedicated to finding its place in the market. Whether that can ever be at the top may be a question for Microsoft, not Nokia.