Browning shocked by Nokia new IT distribution strategy

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20:20 Mobile managing director baffled as Nokia relationship ends after 20 years

“We’re shocked by the decision and think it’s a mistake.” So said 20:20 Mobile UK MD James Browning about Nokia’s decision to end its 20-year relationship.

Nokia this month sensationally axed both 20:20 Mobile and Data Select (10 years) and moved its entire distribution to Micro-P and Ingram Micro.

Nokia told the distributor it wanted more “focus” and more “belief” in its brand.

Browning (pictured left) said 20:20 Mobile could fulfil this requirement, but would not risk jeopardising sales from its other manufacturer partners, such as BlackBerry manufacturer RIM, which remains key in B2B.

Speaking exclusively to Mobile News, Browning said the split was “amicable” but he remained “shocked” by Nokia’s decision.

“Conor Pierce (Nokia UK MD, pictured right) told us of their decision in Crewe, shortly before the official announcement on September 15. He told me they wanted more ‘belief’ and ‘focus’ from its
distributors. We can offer this, but not at the expense of other relationships.”

“I don’t criticise Ingram or Micro-P, but Nokia is taking a risk on partnering with distributors who have a customer base almost exclusively of IT companies, when we have more than 600 customers focussed on mobile.”

New relationships
He also argued that its 20 years of experience working with Nokia will now need to be reinvented with the two new distributors, which could ultimately be dangerous for the manufacturer,
during a period where it has struggled in the current market.

Browning said: “The strategic shift they have made away from the mobile phone distributors to the IT distributors has left us scratching our heads. You would have thought when a business is facing tough challenges in turbulent times it would want to work even closer with its partners.

“I know Ingram and Micro-P relatively well and I cannot think of anything those businesses can do or offer that we cannot. I can write a long list of things we do that they are unable to do.

“They are coming from a position of massive weakness in the market. And it’s taking an operating system with two per cent share via distributors that have around five per cent share – it’s a risky strategy.

“Everyone wants a smartphone and Nokia’s share is dreadful. It’s not long before their traditional handset business gets cannibalised by smartphones. Windows is their path into smartphones. Micro-P and Ingram are Microsoft resellers and this played a part in the decision.”

Dangers
Browning continued: “If Microsoft are pulling the shots, that’s dangerous because they don’t understand the mobile phone business; they understand the computing business. We know that convergence isn’t necessarily working at this moment in time.

“We have 600 dealers, they have to go and sign those guys up and that’s going to take time and effort. Before they can sell anything, they have to agree contractual terms and conditions and credit reference these customers, and go from there. It’s a very fundamental basic that needs to be sorted, which I guess is why Nokia have been keen to leave us open until December.”

Browning estimated 20:20 Mobile makes up 40 per cent of Nokia’s current market share. But sources close to the distributor have claimed previously the business share from Nokia sales at 20:20 Mobile has dropped from around 75 per cent to about 25 per cent in recent years.

There have also been suggestions 20:20 Mobile has struggled to meet targets and is sitting on large amounts of Nokia stock due to a lack of customer demand.

Browning refused to discuss these figures, but insists there will be no financial impact on the business by focussing more on its existing manufacturer partners. These include Huawei, Sony Ericsson, LG and RIM – some of which have already expressed a desire to work more closely with the distributor.

Browning said: “It’s been an amicable split and we wish them no harm. But we have to accept that, even on the Windows 7 platform, we will now be selling against them. We have agreements with other Windows 7 vendors. In just the same way we are in competition with a Brightstar or a Data Select.”

“There is great opportunity for 20:20 as a result of this. We have had all the other suppliers on the phone, asking how they can take that Nokia business.”

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