Nokia cuts Lumia 900's price to $49, struggles in cost management as compared to Apple

Desi Mind Meld .2 hours ago

As per +The Wall Street Journal report, +Nokia is cutting price of its flagship Lumia 900 Windows phone three months after launch from $99 to $49. Nokia was already squeezed on margin with original 2-yrs contract pricing, not sure what their strategy is by reducing it further by half.

As per some teardown analysis by IHS iSuppli market research firm, Lumia 900 carries a bill of materials (BOM) and manufacturing cost (MC) of $217. That is $233 in profit margin at $450 retail without contract. Lumia 900's closest competitor with similar feature set is +Samsung USA’s S II Skyrocket +Android phone, which carries BOM + MC of $244, and a retail price that is $100 higher, at $550.

Comparing Lumia 900, the challenger, to Apple's iPhone 4S, the reigning champion of supply chain and cost management, is a whole different ball game. As per some teardown analysis estimates, iPhone 4S carries BOM + MC of $198 and retails at $649 without contract. That is a whopping $451 margin per unit and $1 more than Lumia 900's retail price!

And then there is economies of scale at work. Apple commands the purchasing power to drive costs down using economies of scale. It is a vicious circle for Nokia and other Apple challengers between economies of scale and purchase power.

Sources:
Nokia Lumia 900 Carries Bill of Materials of $209
Nokia Halves Price of Flagship Phone: Finnish Company Says Move on Windows-Based Smartphone Is 'Normal Strategy'

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Video - Inside Nokia's Struggle Against the iPhone - WSJ.com
Nokia's top-of-the-range Lumia 900 costs $200 less than the cheapest iPhone 4S. But Nokia pays more for the parts. Ben Rooney in London explains how big a problem this is for Nokia. Photo: Reuters 0 0 Powered by socialditto

Desi Mind Meld2 hours ago

As per a Wall Street Journal report, Nokia is cutting price of its flagship Lumia 900 Windows phone three months after launch from $99 to $49. Nokia was already squeezed on margin with original 2-yrs contract pricing, not sure what their strategy is by reducing it further by half.

As per some teardown analysis by IHS iSuppli market research firm, Lumia 900 carries a bill of materials (BOM) and manufacturing cost (MC) of $217. That is $233 in profit margin at $450 retail without contract. Lumia 900's closest competitor with similar feature set is Samsung’s S II Skyrocket Android phone, which carries BOM + MC of $244, and a retail price that is $100 higher, at $550.

Comparing Lumia 900, the challenger, to Apple's iPhone 4S, the reigning champion of supply chain and cost management, is a whole different ball game. As per some teardown analysis estimates, iPhone 4S carries BOM + MC of $198 and retails at $649 without contract. That is a whopping $451 margin per unit and $1 more than Lumia 900's retail price!

And then there is economies of scale at work. Apple commands the purchasing power to drive costs down using economies of scale. It is a vicious circle for Nokia and other Apple challengers between economies of scale and purchase power.

Sources:
Nokia Lumia 900 Carries Bill of Materials of $209
Nokia Halves Price of Flagship Phone: Finnish Company Says Move on Windows-Based Smartphone Is 'Normal Strategy'

Inside Nokia's Struggle Against the iPhone - WSJ.com
Nokia's top-of-the-range Lumia 900 costs $200 less than the cheapest iPhone 4S. But Nokia pays more for the parts. Ben Rooney in London explains how big a problem this is for Nokia. Photo: Reuters

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Research In Motion Loses $147,200,000 in Patent Verdict. All is not well for RIM

Desi Mind Meld .1 day ago

Just got a BBM - All is not well. Research in motion (RIM) may have to shell out a whopping $147.2 Million in patent litigation fine. Unless they can get this verdict overturn, this will surely break RIM's back. RIM is fast loosing its market share to +Android and iPhone. Its stock has fallen by more than 70% in past year. Dark days lie ahead for them.

In the day and age of innovative cool gadgets and of customers with purchasing power, RIM has to work harder to regain the lost ground or at least hold on to what they have by staying relevant. However, after reading interview of Mike Lazaridis, Co-CEO and founder of Research In Motion with PC Magazine at CES 2011, it seems that RIM is not as concerned about the competition. It is also not clear whether RIM's strategy is to stick with its core enterprise, business, and government customer base or expand into larger consumer user base especially in non-US or European markets such as Indian Subcontinent, etc.

RIM's devices are increasingly irrelevant for general consumers and with iOS now providing secure exchange support, enterprises may just adopt non-RIM options as well. In short, RIM is sailing through some troubled waters and a big storm is yet to come.

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RIM Loses $147,200,000 in Patent Verdict
Research In Motion has been ordered by a California jury to pay $147,200,000 to Mformation Technologies. 0    0 Powered by socialditto

Desi Mind Meld1 day ago

Just got a BBM - All is not well. RIM may have to shell out a whopping $147.2 Million in patent litigation fine. Unless they can get this verdict overturn, this will surely break RIM's back. RIM is fast loosing its market share to Android and iPhone. Its stock has fallen by more than 70% in past year. Dark days lie ahead for them.

In the day and age of innovative cool gadgets and of customers with purchasing power, RIM has to work harder to regain the lost ground or at least hold on to what they have by staying relevant. However, after reading interview of Mike Lazaridis, Co-CEO and founder of Research In Motion with PC Magazine at CES 2011, it seems that RIM is not as concerned about the competition. It is also not clear whether RIM's strategy is to stick with its core enterprise, business, and government customer base or expand into larger consumer user base especially in non-US or European markets such as Indian Subcontinent, etc.

RIM's devices are increasingly irrelevant for general consumers and with iOS now providing secure exchange support, enterprises may just adopt non-RIM options as well. In short, RIM is sailing through some troubled waters and a big storm is yet to come.

RIM Loses $147,200,000 in Patent Verdict
Research In Motion has been ordered by a California jury to pay $147,200,000 to Mformation Technologies.

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Per +Nielsen study, Android leads the US smartphone market with 51.8% share

Desi Mind Meld .1 day ago

As per the +Nielsen study, Android continues to lead the smartphone market in the U.S., with a majority of smartphone owners (51.8%) using an Android OS handset. Over a third (34.3%) of smartphone owners use an Apple iPhone, and Blackberry owners represented another 8.1 percent of the smartphone market.

BB is going down sharply. Get your act together RIM, or may be it is too late? Can RIM pull its own Apple story?

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Two Thirds of New Mobile Buyers Now Opting For Smartphones | Nielsen Wire
During Q2 2012 smartphone penetration continued to grow, with 54.9 percent of U.S. mobile subscribers owning smartphones as of June 2012. This growth is driven by increasing smartphone purchases: 2 ou... 0    0 Powered by socialditto

Desi Mind Meld1 day ago

As per the Nielsen study, Android continues to lead the smartphone market in the U.S., with a majority of smartphone owners (51.8%) using an Android OS handset. Over a third (34.3%) of smartphone owners use an Apple iPhone, and Blackberry owners represented another 8.1 percent of the smartphone market.

BB is going down sharply. Get your act together RIM, or may be it is too late? Can RIM pull its own Apple story?

Two Thirds of New Mobile Buyers Now Opting For Smartphones | Nielsen Wire
54.9 percent of U.S. mobile subscribers own smartphones as of June 2012. 2 out of 3 Americans who acquired a new mobile phone in the last three months chose a smartphone instead of a feature phone.

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Wanna bet how long it will take this Spider-like iPhone to have Spiderweb screen

Desi Mind Meld .1 day ago

iPhones are known to have clumsy screens. Wanna bet how long it will take this Spider-like iPhone to have Spiderweb screen.

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Spider-Like iPhone 5 Design Is Creepy Yet Cool [PICS]
One designer has imagined a radical redesign not just for the iPhone, but for mobile communication as we know it. 0    0 Powered by socialditto

Desi Mind Meld1 day ago

iPhones are known to have clumsy screens. Wanna bet how long it will take this Spider-like iPhone to have Spiderweb screen.

Spider-Like iPhone 5 Design Is Creepy Yet Cool
One designer has imagined a radical redesign not just for the iPhone, but for mobile communication as we know it.

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