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Nokia facing 'crisis', warns CEO

Nokia facing 'crisis', warns CEO

Leaked memo warns of competitors stealing marketshare

Nokia is facing a potential crisis, according to warnings reportedly issued to staff by its chief executive.

In a memo from Nokia CEO Stephen Elop, seen by Engadget and verified by various news outlets as official, Elop said Nokia stands on a burning platform surrounded on all sides by fast-growing competitors. Nokia declined to confirm the accuracy of the reports.

Nokia had been surprised by the success of the Apple iPhone, as well as the Google Android operating system, he admitted. Nearly four years on from the iPhone launch, he said, we still don't have a product that is close to their experience.

In the message, being branded by observers as unusually frank in the corporate world, he wrote: Android came on the scene just over two years ago, and this week they took our leadership position in smartphone volumes. Unbelievable."

We have some brilliant sources of innovation inside Nokia, but we are not bringing it to market fast enough, he wrote. We thought MeeGo would be a platform for winning high-end smartphones. However, at this rate, by the end of 2011, we might have only one MeeGo product in the market.

Elop said lower end phones, made and sold in vast numbers, are also presenting a serious problem for the company. They are fast, they are cheap, and they are challenging us.

Nokia still sells the most smartphones of all manufacturers globally, the BBC reported, but its marketshare lost 10 percentage points to 28 percent in the last year alone.

We poured gasoline on our own burning platform, Elop reportedly wrote in the memo. I believe we have lacked accountability and leadership to align and direct the company through these disruptive times. We had a series of misses. We haven't been delivering innovation fast enough. We're not collaborating internally.


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