Nokias huge content project, Ovi Store, is days from launch. We got the big picture from Niklas Savander, EVP of Nokia Services
It’s over 18 months since you announced this. Are you all set for Ovi Store’s May launch?
We’re on target for May, and expecting to have 20,000 content items available from day one. I can’t say how many partners we have, but it doesn’t require many products per company for us to hit 20,000.
Since the various Nokia content services have launched, there has been inevitable resistance from operators. Does this still hold true?
Honestly, in the 18 months since we announced Ovi, the biggest single change has been the relationship with the operators. There are small and mid-tier operators that would struggle to say anything bad about Ovi. The bigger carriers, with their own ambitions in services, have mostly moved from principle to pragmatism. Of course, it’s possible that in some countries not all operators will support Ovi. But most are saying to us: ‘let’s compete in some areas but not all’. I think the economic downturn will be an interesting factor here. It could change things even faster.
The option to charge using operator billing is a big differentiator for Ovi against, for example, iPhone. It must be difficult to implement though.
We don’t want to rely on credit card payments. We can’t. Clearly we are strong in countries where there’s negligible credit card penetration, and in many of these regions the operator is a well-established channel for payments of all kinds – and that’s okay with subscribers. The biggest issue is technical integration. Any operator would tell you that billing is the single most complex issue in running a network. That’s what’s holding us back from launching more quickly. Having said that, we will run the Ovi Store on the basis of a single sign-in and one user identity – just like you get on a credit card-based store like iPhone.
Ovi Store has a huge addressable audience. But this must present a problem in terms of UI...
True. This is clearly not an issue when you only have one product. But we’re trying to get to a broader audience than iPhone. The main aim is consistency – there has to be logic even across different devices or when there is co-branding with operators. We’ve made a dozen or so acquisitions in the run-up to this so now we have to connect them to each other. In everyday terms that means, for example, making sure the log-in to Maps is the same as Ovi – same shopping cart, same billing gateway, navigation, etc.
Is there a future for paid-for products when so much of what we see on existing app stores is free?
I think the products have to be free or fantastic. But free only means the consumer is not paying. It doesn’t mean there’s no revenue. We need to build ad-enabling into the offer, and we bought Enpocket to do just this. We’ve done trials, but it’s not easy. You can ask Blyk how tough it is. I think we all recognise there will be a new mobile model. It’s easy to imagine a situation, for example, in which a user might ask ‘where can I hire a car?’ and Hertz will pay.
Other app stores have been criticised for rejecting apps that might compete with the host’s own services. What’s Nokia’s stance?
Anything goes, whether it competes with our content or not. Consumers want a mash-up of products and we must follow their lead. Obviously, there are default settings where we can promote our products. But there’s no question of us barring competitors, absolutely not.
But surely there are some products, like Spotify for example, that have the potential to destroy a music download store like Nokia’s…
I agree that where there are cheap ubiquitous networks, this is possible. But in mobile there is a limit to bandwidth: you can’t put wires in the sky. And there will always be a bottleneck in the radio frequencies. So in my view we have to build apps that make efficient use of bandwidth, which process data in the client and minimise what goes over the air. It’s what we’ve done in the way we have integrated Maps, for example.
What’s your stance on the taste and decency issue in apps?
It’s difficult because this is not just about adult content but about less clear questions like ‘when does gameplay become violence?’ So it’s about legality, but also morality. Something like Mosh was different, because we operated a safe harbour policy where we took down content when an objection was raised. We take the role of publisher on Ovi, so all content is pre-approved. We have editorial teams working on the service, and there will be different offerings in different countries to protect cultural differences.
What about operator partners? They may not be too happy about a VoIP app on Ovi…
In every market there will be two variants of Ovi – an open market version and one developed with a partner operator. For example, an Orange Signature Ovi might be different from a Phones 4U Ovi. We leave it to the operator to make decisions about what’s acceptable.
Nokia has tried twice before to get into content, with Club Nokia and Nokia Entertainment Services. Both times it walked away. Why is Ovi different?
I was working for the infrastructure side of Nokia back then, so I was trying to build the servers that would run those services. It wasn’t easy. All I can say is that every good idea has to be accompanied by good timing. Maybe the timing wasn’t so good then. It is now.
Finally, what kind of company does Nokia want to be? Is it an entertainment distributor now? Or is the real purpose behind Ovi to sell more phones?
We are a product company. There are still billions of people looking for telephony and we have no intention of leaving that market for anybody else. But we are also a solutions company. We have to change because it’s where our consumers are leading us. They are moving their spending to the digital domain and we hope to extract a larger part of that spending.