It's Nokia's big moment. The world's largest smartphone company is relaunching its brand in tandem with T-Mobile, a hungry, scrappy underdog of a wireless carrier. So to make the best possible first impression, it's launching … a discount smartphone.
What the heck? Nokia and T-Mobile today announced the Lumia 710, a perfectly good budget Windows Phone that isn't the gorgeous, much-talked-about Lumia 800 that's selling like hotcakes in Europe.
I'm seriously worried for Nokia and T-Mobile here. This isn't a fatal mistake for either of them, but it's a misstep, a missed chance to grab back some mindshare for two companies that have been on a downswing recently.
I asked Nokia U.S. President Chris Weber and T-Mobile senior vice president Andrew Sherrard what was up. Weber and Sherrard pointed out correctly that there are far more potential first-time smartphone buyers than existing smartphone owners, and that first-time smartphone buyers are, in Weber's words, "a green field market."
But new smartphone buyers don't make the jump in a vacuum. They look to people they know with smartphones—influencers—as guides. Influencers could be a spouse, an adult child, or a group of friends. They provide tech support, app suggestions, and a sense of being in a community.
For a platform or brand to succeed you need both an entry-level product and an influencer product. Or you could start with the influencer product, get geeks interested, and follow up with a mass-market product. You don't announce the low-end device first and give the influencers nothing, especially when you're working on a platform like Windows Phone with essentially zero market share.
The Lumia 710 is attractive, but it's no influencer product. It's similar in many ways to the Samsung Focus Flash, the little sibling of the Focus S, and the HTC Radar, the little sibling of the HTC Titan. Rather than having a sib to defend it on the playground, though, this li'l one is a singleton.
Adding insult to injury, T-Mobile is launching the Lumia on Jan. 11—two days after we expect AT&T to announce a Nokia partnership at the CES trade show.
Conspiracy Theory Time
Okay, so what's really going on here? Chris Weber isn't stupid, and he wants Nokia to succeed in the USA. He must understand that a big launch would be better than a small one.
T-Mobile's owners, Deutsche Telekom, may have a different idea. Their plans to merge with AT&T rely in part on a theory that T-Mobile has no chance in our market, so it can't run the company too well, or it would help sink their merger. But they can't run the company too poorly either, or they'd face shareholder lawsuits. So they're taking the tactic of keeping their child undernourished enough to be sad and slightly dizzy all the time, but not enough for anyone to call the cops on them.
DT could very well have denied T-Mobile USA the money to appropriately subsidize the Lumia 800, which would have made it unaffordable in the states.
Nokia is also reportedly in talks with AT&T and Verizon. They're both bigger fish, but they're probably demanding LTE phones, which require a software update that Microsoft hasn't delivered yet. AT&T could have demanded that Nokia delay its T-Mobile launch until after AT&T's announcement, as a condition of taking a phone.
I don't want to believe Nokia is stupid, so it probably made some sort of devil's bargain here. And DT clearly doesn't have much interest in T-Mobile USA's success. Two things can't come soon enough, then: some great Nokia announcements at CES, and a potential T-Mobile deal with Dish Network.