Who are Nokia´s customers?

I was recently teaching at the Helsinki Summer University and used an article by Harvard Business Review to teach how value can be created and in particular captured in a value net environment (hbr 1995 July August). We went through the cases of the article and the students were fast to learn, but pointed out that these models are not applied in the modern environment. We started to debate how these models could be applied in present business environments.

A very simple question is to ask, who is Nokia´s customer. You can replace the word Nokia with any manufacturer of a mobile phone. One would assume that the customer is the person who buys the phone. This however is only partially true. Every mobile phone comes with a place for the operator Sim card. The phone has been designed in such a way that it really has no major value unless you connect it with an operator. Thus Nokia´s customer is also the operator and here there is a conflict of interest. How can Nokia get as much value as possible from the end user and at the same time optimise the phone for the operator so that the operator can receive as much value as possible.

I have an E7 phone. It´s great, but I am still not 100% sure if I am using wlan or 3 G connection. In particular I would like to use the wlan to download maps and the 3G to show my position on the map - because roaming charges are excessive.

As a consumer I would be wise to try to unbudle the operator from my mobile phone. This can be done by buying an Internet tablet e.g. an Archos. It comes with in built wlan connectivity and also with blue tooth. On the rare occasion that I would actually need operator connectivity (e.g. 3G) I could couple tha Archos device through a bluetooth connection to a mobile network. This needs a little skill, but ensures that it is the consumer who captures value.

The operators and mobile phone manufacturers need to be concerned. However they can also ensure that value creation is made as easy as possible for the consumer. Try for instance taking a photograph and uploading it to upoyr mobile device. Easy, is it?

Smartphones? - Forget the phone and go to tablets

I am sure you all know that language is very important. It is therefore important to consider, how we should name different things and objects.

Petri Sajari, a reporter on the financial pages of Helsingin Sanomat, interviews professor Jukka Manner from the Aalto University who points out that we should really use the name "nettikännykkä" (Internet phone) instead of the word smartphone.

I was searching for a word for these new devices already six years ago and came up with the word verkotin (networking device) in a comment published in the Talouselämä magazine (27/2005 p 27). Six years ago I had dropped out the word "phone", but as you can see change is not easy. Letting go of the past is not easy. Why should we stick to the word "phone" - after all it could be called " a personal digital assistant", or "an Internet tablet".

Economists and especially game theorist use the term "utility", with which they mean the value of e.g. a product to the user. What is important to understand is that this "utility" depends on, what the person already owns. For example I already have a cheap mobile phone, worth 20-30 Euros, but good for calling. When searching for a new smartphone, I have no "utility" for the voice service because I already have the service. Hence the first requirement I drop out is voice. I recently bought an Internet tablet for 285 Euro´s.

Helsingin Sanomat, in its article, goes around shops searching for a suitable smartphone. They find out that smartphones are priced between 179 and 675 Euros. The salesmen in different shops recommend different samrtphones. The reporter can not really make sense on what he needs and argues that consumers in general are in a similar position - maybe so.

The reporter however does not understand that he should drop of the word "phone". He could get a great tablet for 300 Euro and a good enough phone for 50 Euro, so why pay 675 Euro for the combination?

Maybe, because the utility is in the fact that you can show others that you are in a position to pay 675.

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The mobile internet is rather convenient when travelling. Yesterday at the hotel we browsed the internet via a complementary wlan connection, found the first boat connection to grenwich and now we are on the boat.
a word of warning. You should be carefull not to use the mobile operator data connection because the charges are excessively high.
you should fin a picture of big ben attached, but lets see how blogging from a mobile works.
Lähetetty Nokia-puhelimestani