Know-How Exchange : Student Questions

Hi Nikita,

Try this website:

• https://en.wikipedia.org/wiki/Nokia
• https://en.wikipedia.org/wiki/Sony_ericsson
• https://en.wikipedia.org/wiki/Product_life_cycle
• https://www.sequentlearning.com/
• https://www.nokia.co.uk/nokia/0,,27313,00.html
•https://www.weeeman.org/html/what/lifecycle_case.html
• https://www.weeeman.org/html/what/lifecycle.html
•https://www.matrixone.com/pdf/releases/2004_07_21_release.pdf
• https://www.sonyericsson.com/spg.jsp?cc=global&lc=en&ver=4001&template=pc1_...

Regards,

M Bhor

Hi Niketa,

Before starting the research on Product life cycle and its management I think you must have an fair ides of the current market situation of the nokia and sony ericsson handets/products. Because if you have clear cut vision of the ongoing market scenario then it will be more easier for developing any new product life cycle for any product in new geographical area like you said UAE.

So here are the profile of the two companies:

NOKIA:
Nokia is the largest mobile phone manufacturer in the world and holds around 34% of the global market share, significantly higher than its principal rival Motorola, which controls about 20% of the market. In 2005, Nokia manufactured and sold 265 million mobile phone units, close to twice the volume of the nearest competitor. Additionally, Nokia is also the world leader in GSM and WCDMA devices. The company also has production facilities in eight countries, sales in more than 130 countries, and a global network of sales, customer service and other operational units. The company's leadership position in the mobile phone market has increased its bargaining power and establishes its brand image in global markets.

Market shares......

Nokia Thailand - 46%
Nokia Singapore - 37%
Nokia UAE - 30%

Product development capabilities

Nokia has strong product development capabilities compared to its industry rivals. The company has released a number of new handsets, featuring a variety of new technologies and line extensions including javascript, photo messaging and Bluetooth in recent years. In 2005, Nokia introduced its first 3G/WCDMA products: the Nokia 6280, the Nokia 6233, the Nokia 6234 and the Nokia 6282. The company also introduced the Nokia 3250, a music-optimized device supporting 1GB of memory and the Nokia 6230i, Nokia's highest revenue generating phone in 2005. The company also introduced the 'L'Amour' collection of fashion-inspired mobile phones and the Nokia 5140i outdoor mobile phone featuring thermometer, compass and flashlight. Nokia allocates a vast amount of time and money to its research and development activities (17.8% of net sales in 2005) and this focus will help the company to stay ahead of competitors and retain its market leadership.

Nokia faces stiff competition from various large players in its key segments and markets. The company's principal competitors in mobile devices are companies such as LG, Motorola, Samsung, Siemens and Sony Ericsson. The company also competes with consumer electronics manufacturers and business device and solution providers. In the businesses of operating system and user interface software, chipsets, and application software such as games software, Nokia faces competition from companies like Apple, Canon, Dell, HP, Microsoft, Palm, Research in Motion and Sony. Intense competition threatens to reduce the company's market share and revenue earning capacity.

New cell phones developed by Nokia and Motorola have decreased in life cycle time from 12 to 18 months to just under nine months. Here is product and services analysis of Nokia, based on product types and geographical areas:

PRODUCTS AND SERVICES ANALYSIS:

The company recorded revenues of E34,191 million during the fiscal year ended December 2005, an increase of 16.4% over 2004. For the fiscal year 2005, Europe, the company's largest geographic market, accounted for 42% of the total revenues.

Nokia generates revenues through four business divisions: mobile phones (60.8% of the total revenues during fiscal year 2005), networks (19.2%), multimedia (17.5%), and enterprise solutions (2.5%).

Revenues by Division

During the fiscal year 2005, the mobile phones division recorded revenues of E20,811 million, an increase of 12.4% over 2004.

The networks division recorded revenues of E6,557 million in fiscal year 2005, an increase of 2% over 2004.

The multimedia division recorded revenues of E5,981 million in fiscal year 2005, an increase of 62.7% over 2004.

The enterprise solutions division recorded revenues of E861 million in fiscal year 2005, an increase of 2.6% over 2004.

Revenues by Geography

Europe, Nokia's largest geographical market, accounted for 42% of the total revenues in the fiscal year 2005. Revenues from Europe reached E14,360.2 million in 2005, an increase of 16.4% over 2004.

Asia Pacific accounted for 18% of the total revenues in the fiscal year 2005. Revenues from Asia Pacific reached E6,154.4 million in 2005, an increase of 31% over 2004.

Middle East and Africa accounted for 13% of the total revenues in the fiscal year 2005. Revenues from Middle East and Africa reached E4,444.8 million in 2005, an increase of 26.1% over 2004.

China accounted for 11% of the total revenues in the fiscal year 2005. Revenues from China reached E3,761 million in 2005, an increase of 28.1% over 2004.

North America accounted for 8% of the total revenues in the fiscal year 2005. Revenues from North America reached E2,735.3 million in 2005, a decrease of 22.4% from 2004.

Latin America accounted for 8% of the total revenues in the fiscal year 2005. Revenues from Latin America reached E2,735.3 million in 2005, an increase of 16.4% over 2004.

Research at Nokia:

Nokia's continuous high investment in R&D is one of our key success factors. As of December 31, 2005, we employed 20 882 people in research and development in 26 countries, representing approximately 36% of Nokia’s total workforce. R&D expenses totaled EUR 3 825 million in 2005, representing 11.2% of Nokia’s net sales in 2005, compared to 12.9% of net sales in 2004.

Short and medium term.
Nokia researchers support the product development units to master key technologies and their evolution. This enables us to develop competitive products efficiently.

Long-term.
Research aims to disrupt the present. Research in different sciences with global participation is a prerequisite for creating these disruptions. Research also serves as an organizational pioneer. By challenging the present working methods and technologies we keep the organization moving. Our researchers are also encouraged to bring forth ideas for new business development.


here are few article you can go through:
https://www.nokia.com/2006/Q2/index.html
https://www.strategiy.com/telecomnew.asp?id=20060610071433
https://press.nokia.com/PR/200603/1037967_5.html

SONY ERICSSON:

Sony Ericsson Mobile Communications is an equally-owned joint venture of the Ericsson Division Consumer Products and Sony Digital Telecommunication Network Company. The company combines the cellphone operations of both companies and provides co-developed cellular handsets and services. The company is headquartered in London, UK.

For the fiscal year ended December 2005, the company generated revenues of E7,268 million. The company saw a net income of E556 million during fiscal 2005.

Here are the results:
https://www.sonyericsson.com/spg.jsp?cc=global&lc=en&ver=4001&template=pc3_...

Ericsson mobile development platforms:
https://www.ericsson.com/mobilityworld/sub/open/technologies/emp/index.html...

I will keep posting new information regarding your question

Regards
Maximus

Hi nikita,

I have a good information on Sony ericsson's product development strategy but it is in PDF format. so can i have your email to send it.

Regards
Maximus