Part of Nokia's Problem: Make Ovi Compelling

| About: Nokia Corporation (NOK)

I've got a Nokia (NYSE:NOK) Ovi account somewhere. Signed up for it ages ago, to play around with the Ovi Store when I had an N97 to play with, back when the store was a real exercise in frustration. Since then, my only interaction with it has been spam SMS (with no STOP opt-out) exhorting me to try other features, when I've put that SIM card into other phones.

In other words, I've not exactly had a compelling experience, and the SMS spam is a complete and utter red flag for any business. (I've stopped using Virgin Airlines whenever possible because of text spam - losing them maybe £50-100k lifetime value.)

I don't know anyone who uses Ovi either, among friends or family. I never see email addresses, and none of my acquaintances has ever mentioned it, linked to its site from Facebook, or otherwise brought it to my attention.

Compare that to the number of times I have heard the words "Gmail", "iTunes" or "BBM".

Now, I certainly agree that a lot of people buy smartphones for their standalone capabilities (eg a good voice phone, great camera, browser and so on). Certain people buy phones for apps - although I'm unconvinced that's as important as many seem to think.

But a lot of people get swayed in their decisions because of something server-side or cloud-related. Historically, BlackBerry grew because it was the best way to hook into Microsoft Exchange for businesses.

Now, we see other hooks:

  • If you've got a lot of music on iTunes, you'll want an iPhone
  • If you've got a lot of friends on BBM, you'll want a BlackBerry
  • If you're a heavy user of Gmail & other properties, you'll increasingly want an Android, although it's not quite there yet, as obviously you can get G-services on other phones too.

Nokia doesn't have a story here, certainly in the developed world, and I have seen little evidence of imminent viral explosion. Palm (PALM) never had a server-side lock-in either.

In fact, it wouldn't surprise me if Microsoft (NASDAQ:MSFT) was the next one to make the connection work, perhaps to Xbox or Kinect, as well as its corporate services and Azure cloud.

Maybe Nokia should swallow a bitter pill, and for developed markets drop Ovi services entirely and act as an ODM partner (or dual-brand supplier) to Facebook?