How HMD Global breathed life back into the Nokia brand

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The Nokia 7.1 is another string in the bow for HMD Global

The launch of the Nokia 7.1 gives HMD a stage to reveal its growing confidence as a top player

HMD Global has continued its rise in telecoms with the launch of the Nokia 7.1, as the two-year-old “start-up” solidifies itself as a global top-five vendor.

“We’re proud and confident to say we’re in the top five of the world’s largest manufacturers. Customers love to hear that we’re within that bracket amongst other big names, but we’re not done; we’re still growing very fast at a rate of 100 per cent year-on year,” said HMD Global Western Europe vice president and industry veteran Jon French, speaking to Mobile News at the exclusive launch.

HMD Global, the licensee of the Nokia mobile phone range, unveiled the Nokia 7.1 on October 4 at the Welsh Chapel in central London at an exclusive event for 70 media representatives. It was the sixth device released by the company this year.

Around 70,000 people watched the event live on the internet as CEO Florian Seiche, chief product officer Juho Sarvikas, and UK and Ireland general manager Sarah Edge took the stage to unveil the mid-range smartphone.

Seiche, who helmed HTC when it developed the first Android smartphone, the G1, in 2008, said: “Today marks a key step in our journey. Today we will double down on our efforts with operating partners, especially in Europe. We will partner with the biggest names to accelerate our momentum.

“We’re already working with leading operators. We continue to strengthen partnerships and now we are proud to unveil the Nokia 7.1; it will be our most widely ranged smartphone across Europe.”

The fresh strategy comes after the vendor raised $100 million from investors in May to fund further expansion. This brought the vendor’s valuation to over $1 billion, known as ‘unicorn’ status.

Nokia 7.1: Camera tie-in with Carl Zeiss company

Partnerships

The young vendor boasts relationships with a host of European operators, including T Mobile, TIM, Telenor and Telia Company, to name a few. In the UK, it partners with EE, Vodafone and O2 to range its products, with distribution handled by Exertis.  In its first full fiscal year ending in December 2017, HMD Global posted a total revenue of £1.5 billion, with an operating loss of £56m. It has sold over 70 million smartphones across 80 countries since it was founded in 2016, with French saying the manufacturer has grown that figure by 100 per cent year-on-year.

The firm reached new heights in Q4 2017, according to Counterpoint Research. HMD was third (7.4 per cent) in terms of UK smartphone shipments after a fruitful festive period, sitting behind Apple (42.1 per cent) and Samsung (26.5 per cent). French expects the manufacturer to disturb the top three yet again, despite the recent leaps and bounds made by Huawei.

He said: “We hit third in the UK due to a great festive period with a really good adoption on the devices, and I expect the same again. We are growing year-on-year at a fantastic rate, so I absolutely expect success.

“It’s a competitive marketplace for sure, but we have to be confident in what we do as a start-up. We do that with great products, partnerships and unique aspects such as Android One. Our team enables us to have a relationship with all different types of customers in the UK market to make sure we grow.

“When you’re this size, you have to have a laser focus on what you’re doing. I know its a temptation to say which rivals we’re targeting to take market share from, but you don’t go into it doing that; we’re concentrating on what we do best. Maybe when you get to a certain size and you’re defending market share, you start looking at who is attacking you.

“We’re all about growth; we can take share from anybody, the sky is the limit. But we’re focused on what we’re doing, not what the competition is doing. I can definitely say from a volume perspective and share perspective, particularly in the UK, we’ve got growth all over us.”

Another key factor in HMD Global’s success was the launch of the Nokia 3310 in 2016, which French said was the “best bit of PR all year” and helped grow the feature phone market. According to analyst company IDC, 2.6 million feature phones were sold in the UK in 2017, up from 2.4 million the previous year.

“The 3310 single-handedly grew the proportion of feature phones vs smartphones in Europe last year. It’s a tremendously powerful thing for us as a small start-up brand to adjust the market in Europe,” said French.

Another strong unique selling point, according to HMD Global, is Android One, Google’s device programme for smartphone manufacturers that offers a stable and light version of the Android platform with guaranteed operating system and security updates.

Motorola and HTC have only one device each enrolled on Android One, with Nokia devices the widest adopters of the programme. French thinks this is essential to Nokia having appeal in the enterprise space because security is arguably the most important feature for any business.

It seems Nokia is well and truly back, a stark contrast in fortune for the brand compared with four years ago.

In 2014, the death knell was tolling for Nokia as then-owners Microsoft announced that the 150-year-old iconic brand was not part of its long-term plans. The computing giant spent $7.6 billion (£4.6 billion) on Nokia’s mobile phone business in 2013, then admitted failure with its acquisition and wrote off the colossal investment in 2015.

Then in 2016, HMD Global and Foxconn subsidiary FIH Mobile signed a £240 million deal with Nokia for the mobile phone arm of the business, under which Nokia receives royalties for each Nokia-branded device sold.

French remembers being asked by his boss at the time to leave his post in Dubai as general manager for Microsoft Asia Pacific, to come back to Europe and help establish HMD Global under then-CEO Arto Nummela.

“From that deal, 450 people came over to HMD,” said French. “What my team and I are really proud of is we’re a start-up. HMD Global was literally nobody; then my boss rang me up while I was living in Dubai to get back to Europe and start a new venture. Two years later, we’re one of the top five manufacturers in Europe.”

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