Nokia Product Differentiation
NOKIA
History of NOKIA
The name NOKIA comes after the Nokia River in southern Finland, next to which the original Nokia wood pulp mill was located. The first Nokia century began with Fredrik Idestam 's paper mill on the banks of the Nokianvirta river. Between 1865 and 1967, the company would become a major industrial force; but it took a merger with a cable company and a rubber firm to set the new Nokia Corporation on the path to electronic. In 1967, all 3 companies merged-up to form the NOKIA Group. This NOKIA Group provided work for 460 people. The first handheld mobile phone was launched 1987, this phone was called Mobira Cityman. In 1992 NOKIA made a crucial decision; to focus on telecommunications and move out of its other businesses. Nokia 's core business was now: manufacturing mobile phones and manufacturing telecommunications systems.
Porter´s 5 Forces
Porter´s 5 Forces analysis is done to understand the industry attractiveness of the smartphone industry.
Threat of entry
Easy entry for firms with background in production of technology. (Sony-TVs, Apple-computers)
Supplier Power
Software and Hardware provider(Moderate): There are so many suppliers for software and hardwares and hence the bargaining power is low.
Substitutes
The power of substitutes is moderate and it actually depends on the impact of substitute products. Smart phones do wide variety of functions so any product that specialize In one of those individual functions can also be termed as a substitute.
Buyer power
Buyers bargaining power is high because of the following reasons: * More choice of products and very limited differentiation of those products * Elastic demand- demand is highly sensitive to economy * Less asymmetric information-buyers have all the required information * Less switching costs: This depends on the country and type of mobile plans provided by the service provider
Rivalry
* Rivalry is intense among existing players * The
History of NOKIA
The name NOKIA comes after the Nokia River in southern Finland, next to which the original Nokia wood pulp mill was located. The first Nokia century began with Fredrik Idestam 's paper mill on the banks of the Nokianvirta river. Between 1865 and 1967, the company would become a major industrial force; but it took a merger with a cable company and a rubber firm to set the new Nokia Corporation on the path to electronic. In 1967, all 3 companies merged-up to form the NOKIA Group. This NOKIA Group provided work for 460 people. The first handheld mobile phone was launched 1987, this phone was called Mobira Cityman. In 1992 NOKIA made a crucial decision; to focus on telecommunications and move out of its other businesses. Nokia 's core business was now: manufacturing mobile phones and manufacturing telecommunications systems.
Porter´s 5 Forces
Porter´s 5 Forces analysis is done to understand the industry attractiveness of the smartphone industry.
Threat of entry
Easy entry for firms with background in production of technology. (Sony-TVs, Apple-computers)
Supplier Power
Software and Hardware provider(Moderate): There are so many suppliers for software and hardwares and hence the bargaining power is low.
Substitutes
The power of substitutes is moderate and it actually depends on the impact of substitute products. Smart phones do wide variety of functions so any product that specialize In one of those individual functions can also be termed as a substitute.
Buyer power
Buyers bargaining power is high because of the following reasons: * More choice of products and very limited differentiation of those products * Elastic demand- demand is highly sensitive to economy * Less asymmetric information-buyers have all the required information * Less switching costs: This depends on the country and type of mobile plans provided by the service provider
Rivalry
* Rivalry is intense among existing players * The