Nokia's Weber looks beyond AT&T, T-Mobile for 2012 growth
with Nokia's Chris Weber
Last week at the Consumer Electronics Show, Nokia (NYSE:NOK) unveiled the LTE-capable Lumia 900 Windows Phone for AT&T Mobility (NYSE:T), and T-Mobile USA began selling the Lumia 710 for $50 with a two-year contract. At CES, FierceWireless Editor Phil Goldstein sat down with Chris Weber, Nokia's president of North America, to discuss Nokia's U.S. strategy, the role of LTE and how Nokia can differentiate Microsoft's (NASDAQ:MSFT) Windows Phone software from the smartphone pack.
FierceWireless: How important is it to grow and get Nokia Lumia devices on more U.S. carriers, and potentially not just Tier 1 carriers?
Chris Weber: What we've announced today is the 710 with T-Mobile and then the 900 with AT&T. We haven't announced anything else, other than to say what we said at the beginning, which is that for 2012 we'd launch a portfolio of devices across multiple price points across multiple operators. If you want another multiple, I'd say multiple user experiences. And so we're still committed to doing that. Obviously these partnerships we have with T-Mobile and AT&T are very important, and we're not announcing anything next, other than to say, we believe in a broad portfolio across multiple operators.
FierceWireless: But Nokia has said it will launch CDMA devices as well.
Chris Weber: I think the question is about Verizon (NYSE:VZ), and I'd say they're a very important partner for us.
FierceWireless: AT&T is obviously a big partner for Nokia, and has historically been one of Nokia's stronger partners in North America. How much support do you expect to get from AT&T in their retail, sales and advertising operations? Is the partnership with AT&T materially different from the partnership with T-Mobile?
Chris Weber: I think the most important thing that we do in the U.S. is bring exclusive devices and opportunities to each of the carriers. So the 710 is exclusive to T-Mobile. It's a business model and value proposition they can take to their consumers that's unique. The 900 is exclusive to AT&T. The reason I say that, because it gets to your question, is that doing that exclusivity and giving them something unique allows us to get great carrier support.
So T-Mobile will launch it [the 710], and we're in their winter promotion window. If you go into their stores, all 2,400 stores, we'll be in the front poster in the main window. The center island will be the Lumia 710. We'll be in six different locations in the store. We've obviously done a lot of device seeding and training and all those things with the retail people. So I feel really good about that, because, again, we've brought them something exclusive and unique. I would say that same model applies with AT&T. Without getting into the details, I feel very good about the commitment and support from AT&T. Those details will come out the closer we get to launch... It's a lot of things that span the gamut, it's the promotion, it's the marketing, it's the retail execution, it's the cost of the phone.
FierceWireless: You mentioned exclusivity. Is that how Nokia will approach every carrier distribution deal it forms?
Chris Weber: Yes, I do. I think it's critical for us to be successful in the U.S. That's the way you get great carrier support. I've talked about two things, unique and exclusive. We want to be "the most operator-friendly company" around, which is: How do you create unique and different business models for them to grow their business with Nokia? So we're really focused on that and trying to be responsive to their needs and their business.
FierceWireless: Do you think a lack of LTE up until this point has in any way hindered adoption of Windows Phone overall?
Chris Weber: I don't know if I can talk about what's caused the results to date on it. I think there's a lot of things that go into that. I think you've got to have great hardware, and obviously Nokia brings some very innovative hardware. I think obviously the LTE support helps. [It's] building the ecosystem, so Windows is 50,000 apps and they're adding a significant amount on a daily and weekly basis--all of those things combined. I feel like we've got an innovative set of products.
We have to talk about why Windows Phone is different than the competing ecosystems that are out there. So instead of having static icons and apps, what are these live tiles and hubs? How do you think about it in a more integrated way? When I show consumers the phone, whether they're using an iPhone an Android or BlackBerry, and I show the integrated experience. I can show a five-minute demo, and to get that same experience on a competing ecosystem, you have to download and configure six-plus applications. That's a compelling and unique value proposition. We have to do a great job of telling that story, and I think there's room for improvement there and you can expect to see that from Nokia.
FierceWireless: Are all Lumia smartphones going to be targeted at first-time smartphone buyers here in the U.S.?
Chris Weber: The reality is for the business to be successful we have to go after the first-time smartphone buyers, the intenders, and the switchers. ... We have to go after both. So the 710 goes after those first-time smartphone buyers. The 900 will go after two audiences, first-time smartphone buyers--even though we haven't announced pricing or availability, you can expect, as Stephen [Elop] said, we'll be very aggressive on the pricing. We think that will appeal to smartphone intenders. And then switchers will also be another big market.
FierceWireless: How does Nokia get into the consumer consciousness about these new products?
Chris Weber: That's the work that's ongoing. The two things that keep me up at night is how do we break through with that messaging, and then how do we execute at retail. It's about execution now. And it's not just you're going to spend your way there, even though the company is very committed financially to invest, and you'll see a significant marketing presence. But we also have to make sure we have a unique value proposition and view to consumers and that's the work that's being done. The good news is I feel like we have a unique and differentiated product, and it'd be much harder if you didn't have that. We have that, but how do you break through with consumers, but that's the work that's being done now, to tell that story and get consumers excited and interested.
FierceWireless: Some analysts have said that Windows Phone doesn't have an ecosystem engine--the way Apple does with iTunes and the App Store and the way Google does with advertising and search. What helps build and then sustain momentum for Windows Phone with consumers?
Chris Weber: I think it's not a simple, single bullet that says here's what it is. I think it's a number of things. I think the first thing is, I think what Windows is trying to do is take the best of both of those worlds that you just described. A highly curated and controlled environment with iPhone, and the ability to do anything you want on the other end with Android. We think there's a place in between that that can play. And I think it's about a seamless integrated experience.
By the way, we love apps. But to have just a world of apps, disconnected, siloed and static, we think there's a better way to create experiences. If you go in and search for a movie, and then you look at ratings, and you say I want to buy that ticket, it says, oh hey you have Fandango on your phone, let me just pull you over to Fandango and you can buy the ticket. And it says, if you don't have Fandango, by the way, just click here, we'll download it, and we'll pull you in there. So it's a very integrated experience without the fragmentation you get on the other side.
And I think it's about the holistic experience there around this brand called Windows, which is integrating in content, applications, etc. from the phone to the PC to the TV. And you're starting to see that. Microsoft just released an application for Windows Phone for Xbox. When you're sitting there watching Xbox, you can be looking through your phone at any content that's on Xbox, games, videos, music, etc., pick it, select it and it changes on your TV. So that type of integration and play, I think you're going to see more and more of that.
FierceWireless: Beyond sales figures, how and when will Nokia know whether this new strategy of re-entering the U.S. market is working?
Chris Weber: There's a lot of things internally that we'll measure, but there's one that's far superior to everything else. It's how much do consumers love our devices. At the end of the day, if we have great consumer satisfaction, they recommend it to friends, they love those devices, every other business metric takes care of itself. Certainly, we'll measure numbers, and awareness and all of those things. But at the end of the day, when people get those devices in their hands, how much do they love it. And if we create a great experience there, we think everything else will take care of itself.