September 10, 2010
Nokia Announces New Chief Executive
Stephen Elop, a Canadian Microsoft executive with Silicon Valley credentials, has been hired by Nokia to replace its chief executive officer in order to compete better with Apple in the smartphone market.
Nokia said Olli-Pekka Kallasvuo, who headed Nokia for four years, would hand over the company to Elop on September 21.
Chairman Jorma Ollila told The Associated Press (AP) that he would resign as soon as possible after the transition.
Nokia struggled to keep up with rivals like Apple and Google with smartphones under Kallasvuo.
Elop said during the Helsinki news conference that it was too early to say what he planned to change. He told AP "My job is ... to ensure that we are meeting the needs of our customers, while delivering superior financial results."
The conference was broadcasted live on Finland's main television channels, demonstrating the strength of national interest in the company.
Elop's appointment is a major shift for Nokia. He will be the first non-Finn to run the company.
Investors urged Nokia to bring in a non-Finnish or an American to help the company regain a reputation for "cool" that is has lost since Apple announced its iPhone device.
Nokia has lacked a hit smartphone model since its N95 model which was launched in 2006.
Elop told the news conference that North America was a critically important market and would be "an area of emphasis."
Ollila told AP that Elop's "strong software background and proven record in change management will be valuable assets as we press harder to complete the transformation of the company."
"They have had problems for a long time and have been behind the curve on trends for the past few years. I think it could be good to get new influences, thoughts and ideas," Inge Heydorn, fund manager at Sentat Asset Management, told AP.
"Elop faces a daunting task. Nokia has lost its leadership in high-tier phones and has struggled with the rise of Internet-led services," Ben Wood, head of research at UK-based telecoms analyst firm CCS Insight, told AP.
Elop plans to bring to Nokia an understanding of the design principles that has driven Apple's success.
He spent seven years becoming chief executive at Macromedia before joining Microsoft.
He is a computer engineering and management graduate from McMaster University in Hamilton, Ontario, and also served as a systems executive at Boston Chicken, Inc.
Investors have been speculating something from Nokia for a while.
The company predicted that while global mobile market will grow 10 percent this year, its own growth will remain flat, and its ailing Nokia Siemens unit continues to see revenue fall.
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