12/10/2009
Financial Times
Nokia is completely redeveloping its mobile applications store after the world’s largest phone maker admitted it had failed to challenge adequately Apple’s dominance of the segment.
A “refreshed” Ovi Store will be released next spring, just a year after Nokia first launched its rival to Apple’s App Store last May.
Nokia, which is struggling to compete with Apple in the fast-growing smartphone market, announced on Thursday it would close its flagship retail stores in New York, Chicago and London as it refocuses on selling through mobile operators.
Selling mobile applications on handsets – and attracting developers to make them – has become a key battleground for operators and handset manufacturers, who are all racing to catch up with the iPhone’s software marketplace.
George Linardos, head of products at Nokia’s media group, said on Thursday Ovi Store had been outpaced by Apple after complaints on stability and reliability.
Nokia plans to take a “tortoise and hare” approach to competing with Apple, he said. “The world changed radically around us” after Apple entered the market, he added.
While the first version of Ovi Store consolidated an existing “jambalaya” of services, Mr Linardos said, Nokia has been quietly working on a “next-generation” platform.
For months, Nokia has been listening to criticism of Ovi on community sites such as Twitter.
“We have screens up in our offices running the Twitter feeds all day long,” he said. “It’s like sitting there and getting punched in the face. But when we make improvements we see the impact instantly.”
New features will include in-application payments, a redesigned user interface that makes apps easier to discover, and faster operation. Longer-term, Ovi Store will include recommendations based on friends’ app purchases and more localised content.
Currently, 1m applications are downloaded from Ovi Store every day, growing at 100 per cent month-over-month – but still lagging Apple, which had accumulated 2bn downloads by September, just over a year after it launched. The Ovi suite – which also includes music and mapping services – now has 80m active users, up from 54m in August.
Nokia recently shifted strategy to focus more on software and applications, launching fewer phones in order to boost margins and stay ahead of competitors.
“This is part of a broader, widescale reorganisation that is going on from top to bottom in Nokia’s business,” said Ben Wood, analyst at CCS Insight. “On Ovi, they need to get all their ducks lined up, including hardware, software and services. At the moment, none of those are working properly.”
