updated 11:50 am EDT, Fri July 16, 2010
Nokia stake owners say CEO failing to stop Apple
Nokia shareholders began raising their voices late Thursday in a second call for company CEO Olli-Pekka Kallasvuo to resign. Investment groups such as Pictet Asset Management, analysts at Argus Research Corp., and others are frustrated once again that the executive has remained onboard despite the company losing about $77 billion in US stock market value since the mid-2007 debut of Apple's iPhone, which also arrived just a year after Kallasvuo took the CEO position. Those involved have accused the company of sheltering its leader from the consequences of his actions, allowing him to stay no matter what happens elsewhere in the company.
"I keep expecting Olli-Pekka Kallasvuo to get dumped," Argus' James Kelleher told Bloomberg. "Instead they're changing everyone under him."
In the past year, the company has reorganized twice to try and streamline the effectiveness and speed of its core phone groups, especially the Mobile Solutions group that now handles both its Symbian and MeeGo smartphones. The changes so far have had little impact, as a company that once had more than half of the smartphone market worldwide now has less than 40 percent and is continuing to drop.
Oehman analyst Helena Nordman-Knutson has suggested Nokia could plan a more graceful exit for Kallasvuo by letting him take a board Chairman position should the existing title holder, Jorma Ollila, decide to retire. Others have demanded an outsider or reformist CEO, while others have simply called for a return of more foreign board members, especially Americans.
Half of the board comes from Nokia's native Finland, and an American hasn't had a position since the end of 2007. Kallasvuo has repeatedly promised to improve Nokia's standing in the US since taking the chief executive role, but it has continued to decline as fewer and fewer Nokia devices, particularly smartphones, have had carrier deals with US carriers.
Nokia has been late to many of the developments in smartphones since 2007. It only added its first modern touchscreen phone in late 2008 with the Nokia 5800 XpressMusic and will only have multi-touch at the end of this summer when the N8 ships. Some of the problem has been its speed of delivery, as it has regularly unveiled smartphones early but shipped them only several months later, in many cases after Apple or another major competitor had already released and shipped a phone with as good or better features.
It's now rumored as well that the company may have willfully ignored an opportunity to buy Palm. Despite webOS having multi-touch and a much more Internet-ready platform than Symbian, Nokia reportedly believed that its existing platforms would be enough. A source for SAI believed the company's insular approach could be one of its greatest mistakes.
"If I were a shareholder, I would fire the entire management team," he said.