A brief history of Nokia: From a paper mill, to the world’s biggest mobile company to being acquired by Microsoft
Friday April 25, 2014, 9:14 PM
Earlier today, Microsoft completed the acquisition of Nokia’s smartphone business bringing an end to an era, which has seen plenty of ups and an equal number of downs. Let’s take a look at the brief history of the company that started out as a paper mill in small village in Finland.
THE EARLY YEARS
In the year 1865 Fredrik Idestam built a paper manufacturing mill in Southern Finland and followed it up by launching a second mill in the nearby town of Nokia in 1868. Three years later Idestam transformed his company to a share company and the Nokia company was formed.
Nokia kept growing through the 19th century and in the 1960s the company branched out into electronics. In the next two years it developed a host of electronic devices including radio telephones for the army. In 1979 Nokia took its first steps into telephony by creating Mobira Oy in a JV with Finnish TV maker Salora, and they created the Nordic Mobile Telephone (NMT) service. This was the world’s first international cellular network and in the 80s, Nokia launched its first car phone called the Mobira Senator.
Five years later Nokia launched the Mobira Cityman, the first mobile phone that would run on the company’s NMT network. At 800 grams and priced at $6,308, it may be heavy and pricey by today’s standards, but the device soon hit cult status when Mikhail Gorbachev was photographed using the device.
THE GLORY YEARS
The 90s were the glory years for the Finnish company. In 1994, Nokia launched the 2100 with the now iconic Nokia ringtone. Three years later it launched Snake, one of the most widely recognized mobile games of all time. The Nokia 2100 was such a big hit that it went on to sell more than 20 million handsets worldwide, much higher than what the company had predicted.
In 1997, Nokia also launched the Communicator, which 11 years before the first iPhone was considered to be much ahead of its time. The device not only looked cool, but also offered features like email, fax, calendar and a massive display.
The same year, Nokia also launched the 6110 and the 5110 two more devices, which were way ahead of their time and competition. These devices offered a much sleeker way of text messaging, a beautiful menu system customization options like multiple color snap-on covers. These devices were followed by the 7110, which offered basic web functions, the 7650, with a built-in camera and the 6650, the company’s first 3G enabled smartphone.
By 1998, Nokia had firmly established itself as the global leader. Where its rivals like Apple, Sony and Siemens had failed to predict the global demand, Nokia sailed through these years with a turnover that increased 500 percent from $ 8.9 billion to $42.8 billion.
There is an old Finnish tale, which talks about Sampo, an engine of eternal wealth created by the poor people of Kalevala. Sampo essentially grinds out gold, salt and wheat from three horns, day and night, but as nothing good lasts forever, one day Sampo drowns to the bottom of the lake and the people of Kalevala are returned to their gloom and poverty.
As is with old tales, one can easily relate Nokia to the Sampo. After the glorious 90s, in 2007 things began to go downhill — and rapidly. In the year 2009, Nokia posted its first quarterly loss in more than a decade. This was largely due to HTC developing a smartphone running on the yet new Google Android operating system. With the iPhones and various Android smartphones taking the market by storm, Nokia failed to keep up with them. Instead of joining the horde of Android adopters, Nokia’s new CEO Stephen Elop joined hands with Microsoft to develop smartphones running on the Windows Phone platform.
Though the partnership saw the development of Nokia’s popular Lumia series of smartphones, Nokia wasn’t able to rekindle its glory days.
END OF AN ERA
On September 3, 2013, Nokia announced that its hardware department would be acquired by Microsoft in a deal worth $7.2 billion. After eight months, the deal was completed today and with it came the end of an era.