Nokia is heading in a new direction without its mobile-phone division. The man charting it: Rajeev Suri, whom the Finnish tech company appointed as its CEO on Tuesday.
Suri, the former head of Nokia’s networks division, will serve as the company’s CEO starting May 1. He will take over duties from company chairman Risto Siilasmaa, who has served as acting CEO since September, and succeed former Nokia CEO Stephen Elop, who joined Microsoft (along with several other company executives) when the company purchased Nokia’s devices and services division last September in a deal worth roughly $7.2 billion. The acquisition was finalized last week, and Elop now serves as the head of Microsoft’s new mobile division.
So where does he take Nokia from here?
Suri will have to focus on Nokia’s remaining products and services—namely, its lucrative if boring network-equipment business and its Here location-services division, which makes navigation apps for consumers and licenses maps data to other businesses.
What Suri Means For Nokia
Suri is known as a turnaround specialist, but that’s not what Nokia needs. Instead, it must build new businesses. That’s where Suri could turn back to the early days of his career at Nokia, when colleagues credited him with driving revenue at Nokia Networks, the company’s telecom-equipment division, and creating a new services hub in India.
To bring in revenue, the company will largely rely on its network-equipment business, which accounts for roughly 90% of the company’s sales. It helps that Suri knows this business well. In this space, Nokia needs to fight off Ericsson and Huawei Technologies, so Suri will be charged with making the company more focused, and efficient.
But that business is uninspiring, and doesn’t paint a future for growth.
Mapping A Future
Suri would be wise to focus on expanding Here, Nokia’s cloud-based location services and mapping solutions. Google Maps is a dominant presence in this business, and has largely locked up the Android world for mapping and navigation tools; Apple is trying to exert similar control over maps on iPhones with its own service.
As such, Nokia is a critical counterweight. Microsoft, Amazon, and Yahoo, among others, use Here’s location data in their online services.
Maps will be a big focus in software this year: Apple is expected to announce big improvements to its Maps in June, while Google keeps adding new features, like Street View’s new Time Machine.
Nokia’s Here has features like guided voice navigation, live traffic information and even heatmaps to show popular areas for food and nightlife in select cities. The company also has a great deal of indoor maps available—49,000 buildings in 45 countries. If Nokia hopes to compete with Apple and Google in this field, the company will need to expand those offerings further and improve its mobile experiences on iOS, Android and Windows Phone devices. In not being tied to a mobile operating system, Nokia has a chance to win partners and court developers who don’t want to depend on a single platform.
There are other areas where Nokia could innovate. It has kept its large pile of patents, and it has retained an “office of the CTO,” a group that explores new technologies.
In shaping what remains of Nokia into a coherent company, Suri must shed his reputation as a turnaround artist and instead become a builder. If Here does not become the company’s iconic new product, he’ll have to invent one. Can Suri make Nokia the world’s biggest startup? It’s a tall order for someone who has spent most of his career as a company man.
Image courtesy of Reuters