Nokia reorganises corporate structure

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Nokia is set to reorganise its corporate structure from January 2008 as part its move towards becoming an 'Internet company'. Nokia's current structure of business groups and horizontal group will change to three main units: devices, software and services and markets. Currently S60 devices are produced by the Multimedia group (Nseries), Enterprise group (Eseries) and Mobile Phones group. The new structure sees a greater emphasis on software and services a main stay of which will presumably be the S60 Platform.

The restructuring reflects the changing market place. Ever greater differentiation and innovation is taking place in software rather than hardware. Nokia has moved from a communications device business to one with wider scope where additional services and product experiences converge into its communications offerings.

A major part of Nokia's future lies in continuing to develop innovative software and services and so having a specific business group to address this makes sense.

Devices, of course, remain very important and bringing all device production into one group should help simplify the current management structure. While the previous market segmented approach made sense when segmentation was largely hardware driven it makes less sense not that it is largely software driven. For example each business unit produced their own S60 devices resulting in potential inefficienties.

Extract from the press release:

"The convergence of the mobile communications and internet industries is opening up new growth opportunities for us, both in the devices business as well as in consumer internet services and enterprise solutions. Growing consumer demand for rich, mobile experiences creates an opportunity for change.  Nokia will bring these capabilities to the broadest range of devices and price points.  This unleashes the power of Nokia's device volumes, now coupled with new services and business solutions. This distinctive approach sets Nokia apart from point solutions vendors," said Nokia CEO Olli-Pekka Kallasvuo. "We believe this new organization can capitalize on these opportunities while allowing us to increase the effectiveness of our investments and the efficiency of our operations."