Mobile Entertainment

It didn’t have anything anywhere near as sexy as Motorola’s Razr and observers wondered whether Nokia had an answer for Sony Ericsson’s success with its Walkman and Cyber-shot families.

Well, that was then and this is now. Last week Nokia reported financials that confirmed it is as big in device sales as Moto, Samsung, SE and LG put together. It now commands an incredible 40 per cent of the world’s handset market – and does so despite meagre sales in North America.

It’s an astonishing performance. I bet there are some wry Finnish smiles in the Nokia boardroom at the continuing hype around iPhone and Apple’s four million handset sales. In 2007, Nokia sold 437 million phones – including six million N95s in the last quarter alone.

Obviously this is not a like-for-like comparison. iPhone did its four million with just four operators, but it still indicates the massive gap between the perception of Apple in the mobile space and the reality.

What’s going to be most fascinating in the next few years is where Nokia goes next. As ME readers should know, Nokia is subtly diversifying from devices to services by launching content initiatives like Nokia Music and N-gage. It’s also bought Navteq, Enpocket and, most recently, Trolltech, taking it respectively into location services, advertising and operating systems.

Now, this would be understandable for a company like, say, Motorola, which is struggling a bit in hardware (and there have been unsubstantiated rumours that Moto is considering a pull-out from devices), but Nokia sold 100 million more phones in 2007 than 2006. 100 million!

Nokia is clearly preparing for the future by looking back to the past. One of its execs told me recently that the company is mindful of what happened to IBM in the eighties as an example of how an apparently unassailable market leader can be overtaken by events and lose its way. It’s probably looking to its own history too.

This week I downloaded a podcast about a small Finnish village in which elderly residents were left some shares in a rubber company by an old guy who used to live there. You can guess the rest. The rubber company got into mobile and now there are some very rich OAPs in the locality.

I’m sure those aged shareholders will be following the progress of N-gage with interest.