Microsoft to stop selling Lumia in China, Japan

Nokia was very successful with a set up like this in most of the world during the Symbian days. People would go buy unlocked handsets of all kinds super expensive flagships (N8, N900, N95, etc.) as well as cheap value phones at full retail price at a Nokia Store and pick their GSM carrier as they saw fit. Nokia even tried this in the US with some flagship Nokia stores in LA and Chicago (I think, they were fading out as I joined and none were in my territory). They never made any meaningful impact on sales for Nokia in the US.

Microsoft to stop selling Lumia in China, Japan

This is due to a couple reasons:

1. American buyers – we do not like to shell out $800 for a flagship phone up front. Especially a few years ago when your monthly fee was the same whether you brought your phone or not, now it is better with Verizon Edge, etc. that discount the plan if you are not on contract. But Americans would rather pay over time for that phone using Verizon Edge, T-Mobile Up, and the like to still pay that full retail price but stretched out over 24 months. So the average buyer is going to lock themselves into some form of contract with a carrier just so they don’t have to shell out the money up front.

2. CDMA – This is going away with everyone’s move to LTE, but VZW and Sprint both require CDMA to work on their voice networks. Since these 2 make up a good chunk of the customers in the US Microsoft cannot just ignore them (thankfully since I am on VZW!) but it then requires putting CDMA hardware in phones that will never use it (ones sold for ATT and T-Mo). Which is doable but adds to the cost. Also due to the nature of CDMA VZW and Sprint would both have to have all of the MEIDs (think serial number, if you haven’t used CDMA phones before) in their system so they can be activated. Apple has overcome these obstacles but it has significant clout right now and is willing to just not sell phones to a carrier if they don’t comply. And they would be less likely to comply with other manufacturers because…

3. Carriers like to be special – All the carriers want to have exclusive phones or features. Carriers want to make their offerings seems special so they can lock those consumers into their service. It doesn’t even matter if the phones are basically the same, as long as they are different enough to give them something to tell customers. They think Verizon exclusive Nokia Lumia Icon sounds better than Lumia 930 (that you could get at ATT or T-Mo, if they sold it). Carriers pay big money for exclusivity through required advertising budgets or just large orders.

Sorry for the long rant, I could go on but for everyone’s sake I’ll stop… I completely agree that your idea would be great and it was a huge point of frustration for me when I worked with Nokia. I used to love dealing on Nokia’s unlocked phone business, but unfortunately it eliminates about half the potential buyers due to the CDMA carriers not being on board. And the majority of the rest of the US consumers just never seemed to care.


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