Nokia halts Ovi Share development, sharpens service strategy focus

Published by Rafe Blandford at 21:33 UTC, May 12th 2009

Nokia recently announced it was refocussing its service strategy in certain areas. Nokia said it was looking to 'provide a better, more simplified service' and would work more closely with third parties. The implications of this announcement are now starting to emerge: mocoNews reports that Nokia is closing its Kirkland (Seattle) offices and Reuters reports that Nokia is halting investment in its media sharing site, Ovi Share. Read on for more.

Nokia's new service strategy focus

In its press release Nokia noted:

"The planned changes are aimed at improving and simplifying the user experience of Nokia services, increasing opportunities for third party developers and other partners to create compelling services, and accelerating the development of a common platform for Nokia's different service offerings," said Niklas Savander, Executive Vice President, Servic es, Nokia.
 
As part of the announced changes, all mobile games will now become available through the Ovi Store, in addition to through their existing channels. "We believe this will create a better experience for Nokia's millions of customers and spur opportunities for game developers," Savander continued.
 
In addition, Nokia will add a variety of third party partners, such as other image and social networking sites, to the image capture and sharing features on its devices. This move is aimed at enhancing the Nokia device experience for those customers who actively use third party services.

Translated out of press release speak, what this means is that Nokia is looking to work more closely with existing third party services. Rather than try to build every service itself, Nokia will look to partner with existing services. In the case of media sharing this means working more closely with services like Flickr, YouTube, Facebook and MySpace.

We can expect to see additional services being added to Share online application (currently just Flickr, Vox and Ovi Share), which is the basis for media sharing across a number of Nokia devices. The MySpace and Facebook homescreen widgets, which will ship on the Nokia N97, are further examples of this strategy. 

At the Nokia Developer Summit, Nokia announced its intention to make APIs available for Share online more widely available. Previously these have been shared only with a limited set of partners. The basic APIs are based around the ATOM Publishing Protocol. This is part of a larger plan to turn Ovi into a platform on which developers can build their own solutions. An additional example of this is Nokia's Apps on Maps initiative.

Related to this is the news that all mobile games will become available though Ovi Store. This means we'll see N-Gage and SNAP Mobile games being made available though Ovi Store. N-Gage games will be available on a try and buy basis, but, for the time being, Nokia will still use the N-Gage client as their launching mechanism and community/online hub.

Ovi Share goes into maintenance mode

In the Reuters news article a Nokia spokesperson is quoted as saying that "Ovi Share ... is planned to be maintained in its current state". In effect, Nokia will discontinue further investment in Ovi Share and instead rely on, and direct its users to, third party media sharing sites. While Nokia does plan to maintain the site in its current state, this is effectively the end of the road for Ovi Share.

Ovi Share was operating in a very competitive space and increasingly faced criticism for its performance and feature set when compared to Flickr and YouTube. Ovi Share was the result of Nokia's acquisition of Twango. Twango's original vision was to provide a site for sharing any type of media, with an emphasis on sharing within existing social connections (through 'Channels'). Under Nokia, this vision was, to an extent, diluted to become a more generic media sharing site. This was an inevitable result of the need to fit it into the Ovi service portfolio.

Nokia will use third party media sharing sites to provide the same functionality of Ovi Share. Given that this is what most users are doing anyway (i.e. uploading to their favourite media sharing site regardless on the one click upload functionality provided by Ovi Share), it is a sensible rationalisation of Nokia's service strategy. There may even be potential for revenue sharing opportunities as Nokia leverages its unique user reach to the benefit of third party companies.

Nonetheless, the failure of Ovi Share to gain traction will be an embarrassment for Nokia. Quite apart from the estimated $96 million cost, it demonstrates the difficulty it has had in building Internet services as it seeks to transition from being a hardware dominated company to a hardware, software and service led company.

Nokia has had mixed fortunes with its recent service-related acquisitions. Files on Ovi (Avvenu) is largely unheralded and Nokia has recently cut back the sales team of its mobile advertising division (Enpocket). On the more positive side, Loudeye provided a decent base for the Nokia Music Store and Nokia's gate5 acquisition has matured impressively into the Nokia Maps service; it is now leading the social location charge. Intellisync was a spectacular failure on the enterprise side, but looks set for an impressive come back as the structure behind Nokia Messaging. It's still too early to come to any real conclusions on Oz Communications (being integrated into Nokia Messaging) and Plazes (being integrated into Nokia Maps).

Acquisitions aside, Nokia faces a key test - it must prove its ability to work closely with third parties to build solutions on top of its Ovi ecosystem. Nokia provides third parties with a unique opportunity because of its unmatched reach, but this benefit is only felt if sustainable and profitable partnerships are built.

On a more general level, this ties in with the company's overall business strategy, which has seen Nokia executives speak about the need for Nokia to collaborate with others in the creation of open ecosystems. The most obvious examples of this strategy are the Symbian Foundation and Qt Software, but the 'openness' strategy is pervasive in current Nokia thinking.

Rafe Blandford, All About Symbian, 13 May 2009

News Discussion

Quote:

Originally Posted by Williamoni The rationalisation arguments are no doubt valid but to me this is primarily a cost-cutting exercise, a response to the global economic downturn. Nokia has already posted relatively poor sales from the last quarter. The years of plenty are over and we are into the years of famine. The questions are how long the famine will last, and will Nokia recover hearts and minds after a fairly mediocre performance in the last eighteen months.

Yes absolutely, should have made that clearer. I don't think the end result would have been different in the long term, but I'm sure the economic climate has accelerated this.

Quote:

Originally Posted by Ammar_Dento To integrate well with 3rd parties we need mature 3rd party applications not only simple widgets. It will take too long time to see Flickr application optimized & integrate itself well in the firmware,this if Yahoo! is interested in programming a .sisx application. Other 3rd party sulotions have there own strategy to make S60 appear like a dump a**,Google will focus on there Android for Example and keep S60 suffer there .jar applications.

I think Share online does a good job of integrating with Flickr - makes phot uploads easy, but you can also browse your own and others contacts , add comments etc. In fact I'd rate it as one of the best client solutions for Flickr on mobile. The mobile site is good too.

Quote:

Originally Posted by rvirga Aside from those who bought CWM phones, and to try a few songs to see how it works, does anybody here uses the Nokia Music Store on a regular basis? It's kind of expensive (10 euros for Nevermind by Nirvana, compared to 4.89 euros on the german Amazon MP3 store), the tracks have DRM, and to top that off to access the store from a PC you must use Windows with IE. The whole thing spells "Epic Fail" to me, in giant neon letters, but maybe it's because I'm a Linux user.

Depends on the market you look at I guess. It's more of a case that in general the Nokia Music system is reasonably well put together. Issues around pricing and DRM will change in time. The convenience factor is impressive IMHO.

But yes agree pricing needs improving. CwM still has a lot of potential too (as demonstrated in Singapore), but need sortng out for other markets.

Quote:

Originally Posted by neilhoskins If they're pointing us in the direction of third parties, why aren't there more services on ShareOnline, necessitating yet another layer of service like PixelPipe, as discussed the other day? Where are the ShareOnline configuration files for Picasa, YouTube, and Facebook?

I think the point of the announcement is that we'll start seeing a lot more of those. Wish they would hurry up as they can easily push new services when you the phone checks for available services (mutter, mutter).

Quote:

Originally Posted by rvirga It's kind of expensive (10 euros for Nevermind by Nirvana, compared to 4.89 euros on the german Amazon MP3 store), the tracks have DRM, and to top that off to access the store from a PC you must use Windows with IE. The whole thing spells "Epic Fail" to me, in giant neon letters, but maybe it's because I'm a Linux user.

You're right. Because of the things you mentioned of course it's an absolute colossal epic failure.

Let's do a quick summary of Nokia's undertakings and decisions:

Comes With Music - fail :icon13: (most titles 100% cheaper elsewhere)
Ovi - fail :icon13:
Friend View - fail :icon13:
Nokia Maps - fail :icon13: (google maps way better)
Download! - fail :icon13:
no more communicators - fail :icon13:
no more tablets - fail :icon13:
ngage - fail :icon13: (where are the good games?)

Did I miss anything?

I guess Nokia is dead set on the startegy of creating basic phones with some smartphone functionality. And they'll rave on about how great these cheap toyish phones sell in India or China.

Sad.

Quote:

Originally Posted by Arthur You're right. Because of the things you mentioned of course it's an absolute colossal epic failure. Let's do a quick summary of Nokia's undertakings and decisions: Comes With Music - fail :icon13: (most titles 100% cheaper elsewhere)

Cheaper than free? Methinks you mean Nokia Music Store...

Quote:

Ovi - fail :icon13: Friend View - fail :icon13: Nokia Maps - fail :icon13: (google maps way better)

Except for not offering turns based navigation and therefore being sod all use as a sat-nav... Nokia Maps works perfectly well leading me from place to place.

Quote:

Originally Posted by TomJ Nokia Maps works perfectly well leading me from place to place.

For day-to-day car navigation (drive), Garmin XT is much better, since Nokia Maps has an atrocious UI (one example: you have to switch between day and night mode manually, although the program could easily do it automatically based either on the time or the luminosity sensor. Try switching to night mode while you're driving! Or better, don't!!!) and limited functionality. For pedestrian navigation (walk), Google Maps is much better, again because it offers more functionality, such as public transportation route planning for many major cities.
Where Nokia Maps excels, in my experience, is when you take a trip outside your country. Buying a 30-days walk & drive Nokia Maps license for the country you're visiting much is cheaper than buying Garmin maps for it. And of course, even if you're not driving, using Google Maps abroad is out of the question because of the data roaming charges.

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