Nokia has posted a €150m operating loss for 1Q13

Finnish handset manufacturer Nokia has posted a €150m operating loss for 1Q13. Viewed in context this should be encouraging; the loss is a fraction of the €1.338bn the firm lost in the same quarter in 2012.

However, net sales for the same period dropped 20 per cent year on year to €5.85bn from €7.35bn in 1Q12.

The handset vendor sold 61.9 million devices in the quarter, 25 per cent fewer than the 82.7 million it sold in 1Q12 and saw sales drop year on year in every geographic region it operates in, with the exception of North America, which ironically is the company’s weakest traditional market.

CEO Stephen Elop claimed Nokia is executing its strategy with “urgency” and managing costs “very well”.

“We have areas where we are making progress, and areas where we are further increasing the focus,” he said. “For example, people are responding positively to the Lumia portfolio, and our volumes are increasing quarter over quarter.”

He acknowledged that the firm has a tall order trying to reclaim one of the top spots in the handset market.

“Our Mobile Phones business faces a difficult competitive environment, and we are taking tactical actions and bringing new innovation to market to address our challenges.”

According to Fred Huet, managing partner at Greenwich Consulting, Nokia has been performing well in emerging markets, but the challenge ahead of the firm is sustaining its momentum as those markets become increasingly competitive.

“Everyone is now spotting that the emerging market space is strong in terms of growth in smartphones; the projections for smartphones in those regions are quite high, so now everyone’s turning their attention to them,” he said.

“In India, for example, Nokia has performed well but it’s becoming a more competitive market, because of the Chinese and Korean handset manufacturers.  Samsung has now launched some handsets specifically designed for emerging markets. China is very good at producing low cost and mass production handsets, so the question is how long can Nokia keep momentum?”

Huet added that Nokia’s decision to rely heavily on Microsoft as its OS partner for smartphones is not paying off.

“Two years ago, I thought it was interesting proposition; Nokia is good with hardware and Microsoft is good with software. But Microsoft’s Windows Phone platform is not getting the traction the firm was expecting and in the meantime, Blackberry is slowly turning round its fortunes after consecutive quarters of market share loss in developed markets.”

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Google’s “predatory distribution of Android” at below-cost makes it difficult for other OS providers to compete, said Fairsearch

A pressure group with members including Microsoft, Oracle and Nokia has filed a complaint with the European Commission claiming that Google has used anti-competitive practices to dominate the mobile space.

Under the Fairsearch name, the group claims that Google has unfairly cemented its control over consumers’ mobile internet experience and in online advertising for mobile.

The search giant’s Android platform runs on 70 per cent of devices shipped at the end of 2012, according to Strategy Analytics, Fairsearch noted, and Google has a 96 per cent share of the mobile search advertising the market, according to research agency eMarketer. The group also accuses Google of using “deceptive conduct to lock out competition in mobile”.

The group said that Google’s dominance in the smartphone operating system market came from its policy of giving Android to device manufacturers free of charge. Yet the group claims these same device manufacturers are forced to pay costs for Google services such as Maps, YouTube and Play that are required to be prominently placed on the phone. This, Fairsearch said, hinders rival app and service providers.

“Google is using its Android mobile operating system as a ‘Trojan Horse’ to deceive partners, monopolise the mobile marketplace, and control consumer data,” said Thomas Vinje, Brussels-based counsel to the FairSearch coalition.

“We are asking the Commission to move quickly and decisively to protect competition and innovation in this critical market. Failure to act will only embolden Google to repeat its desktop abuses of dominance as consumers increasingly turn to a mobile platform dominated by Google’s Android operating system.”

The complaint added that Google’s “predatory distribution of Android” at below-cost makes it difficult for other OS providers to compete with the mobile platform.

Microsoft itself was once the target of similar anti-competitive allegations. In 2004, the European Union found Microsoft guilty of abuse of its dominant position in the PC market.

Florian Seiche will head the Finnish firm’s European sales team from June 15

Device vendor Nokia has poached Taiwanese rival HTC’s EMEA president Florian Seiche. Seiche will head the Finnish firm’s European sales team from June 15, while HTC will replace him with EMEA VP product and operations Phil Blair.

Seiche has headed HTC’s regional sales team since 2010, and has previous experience at Orange-France Telecom and Siemens. His replacement at HTC, has been with the firm since it launched in EMEA in 2005. Blair has also worked closely with Seiche as co-founder in the region, according to HTC.

“Phil’s depth of experience in the smartphone market, intrinsic understanding of mobile products and long-standing relationships with key industry partners put him in a strong position to create new opportunities for the business, taking HTC into its next phase of growth,” HTC said.

In January 2013, HTC saw itself slip out of the world’s top five smartphone vendors, according to research firm IDC, when it was surpassed by Huawei and Sony.

In February, Nokia launched two new Lumia Windows Phone devices, each priced to specifically target a particular consumer segment—’Trendy Youthful’ and ‘Low-cost and Quality’. The Finnish firm is hopeful of reversing a decline that led to it posting an €2.3bn operating loss in 2012; more than twice as deep as that recorded a year earlier. However, the firm posted an operating profit of €439m in 4Q12, up from a loss of €954m recorded in the same quarter of 2011.

The new Lumia 720 is aimed at the trendy, youthful segment and is priced the highest of the two latest additions. The device is expected to lure content-driven users as it has plenty of storage and is expected to hit the high-tier of mid-range handsets. It has a sleek design and sports a 4.3in display and 1GHz dual-core processor. It also has NFC and changeable covers that allow the device to offer wireless charging. Specifically, the Lumia 720 aims to take some DNA and services from the flagship Lumia 920, and provide them at a much more affordable price.

In contrast, the new Lumia 520 pushes the quality and styling of the range down to its lowest price point, just €139. It has similar styling to its stablemates and is aimed squarely at those consumers wanting high standards on a low budget. Again, the device borrows Nokia’s styling and differentiated services from those higher-tier Lumias.

Both devices are significant additions to the Lumia range and build on their number-based classification. The pricing also takes the range, and the Windows Phone 8 operating system, into uncharted waters, which can only help drive the platform into new segments and territories to boost volume and market share.

With these devices, Nokia has also made the correct decision to take the DNA of the high end of its portfolio down the price tiers rather than launch warmed-up versions of its lower-end products. This approach is sure to attract consumers to the new smartphones and, added to Nokia’s prized differentiated services, will provide an enticing value proposition. This proposition will undoubtedly be helped by some unique and ingenious marketing used at point of sale which focuses on Nokia’s differentiated technology and services, rather than the platform.

However, while the Lumia 520 has clear expectations and focus, it is difficult to see how the 720 will fare in the squeezed mid-range. Under current market conditions, there is still a polarization in the market as consumers either plump for high-end devices or look for value, low-end products. The 720 appears to sit somewhere in the middle, which, despite quality design and services, may stifle its market potential. This is, unless Nokia can position it as the flagship product in its Lumia range in certain markets around the world.

Nokia's Lumia range is helping improve the brand's loyalty

Nokia has made strides in restoring its reputation among its UK consumers, according to research from YouGov. The market research expert’s Smartphone Mobile Internet eXperiences tracker (SMIX) shows that the Finnish firm substantially improved its levels of customer advocacy and loyalty during the last three months of 2012.

In the final quarter of the year, the number of Nokia customers that said they would recommend Nokia handsets to others rose by 13 per cent to 45 per cent. In the same period, its detractors fell from 37 per cent to 33 per cent.

Nokia’s UK smartphone market share fell from 30 per cent in December 2009 to six per cent in September 2012, YouGov said. However, with 40 per cent of its customers now using the firm’s flagship Lumia devices, there has been a sharp upturn in its customer satisfaction ratings.

Over the final quarter of 2012, Nokia saw a 12 per cent improvement in the number of customers saying they would get a Nokia next time; from 30 per cent in September 2012 to 42 per cent in December 2012. However, among smartphone manufacturers Apple retains the highest loyalty ratings, with 80 per cent of its customers saying their next phone would be an iPhone.

“Nokia has finally turned a corner. By increasing the number of Lumias in its base it has given its customers something worth coming back to,” said Russell Feldman, associate director at YouGov.

“It is now seen by its consumers as a quality smartphone brand. While they are still a fair distance behind Apple and Samsung in terms of market share and loyalty, the fact they have changed consumer perception among their customers puts them in a solid position as the smartphone war intensifies.”

The Asha 310

The introduction of Nokia Asha 310 is clear evidence that the gap in the user experience between entry-level smartphones and feature phones is blurring. This phone mimics to perfection key aspects of a smartphone including touch/gesture UI, support for various connectivity solutions, storage footprint, and most importantly support for more popular applications and multimedia content.

However, like any other feature phone, Asha 310 does not support always-on connectivity and content push for data applications, which means applications are not refreshed dynamically without a prompt from the user. This together with the relatively low-processing performance and the lack of multitasking could disqualify this type of devices from being included in the smartphone category. Having said that, in comparison to a smartphone, Asha 310 is much less bandwidth consuming and is less of a burden on the network in terms of signalling. This means users can make significant savings on their data plans while consuming the same content compared to on a smartphone.

Pricing is another key advantage in favour of Asha 310. Priced at just above $100, this device could compete against any branded smartphone with equal user experience. All smartphone models currently playing in this price range are either supplied by unreliable micro-brands or are discounted old models often lacking the latest key features and functionalities.

It’s a testament to the job Apple has done in the smartphone market in recent years that a company that has managed to make $13.1bn in just three months could draw the criticism it has. $13.1 bn – that’s over a billion dollars each week for the quarter; more than enough to buy 13 Instagrams.

Nonetheless, the performance missed analysts’ expectations and wiped $50bn off the company’s valuation – the firm’s share price dropped to$450.66; it peaked in 2012 at $702.10.

Sure enough, the naysaying began. “Apple’s products have begun to lose their “innovative” top luster,” said Andy Castonguay, principal analyst at Informa Telecoms and Media.

“The market has disconnected itself with Apple,” Jack de Gan, chief investment officer at Harbor Advisory Corp told news agency Reuters.

“It’s going to call into question Apple’s dominance in the space,” added Sterne Agee analyst Shaw Wu.

But Apple has plans to bounce back from this tragic news. Again, this is the news that it made £13.1bn in 13 weeks.

The firm will add another 36 networks to the selection of carriers that are permitted to offer the iPhone 5 with LTE support enabled, next week. CEO Tim Cook made the revelation as part of the company’s earnings call earlier this week. However, the expanded list does not extend to carriers in parts of Asia and Russia.

“Next week, we’re adding 36 more carriers for LTE support. These carriers will be in countries that we are not currently supporting LTE. So the LTE coverage now, as of next week is in Italy, Denmark, Finland, Switzerland, Philippines, also several Middle Eastern countries.” The Informer still can’t get his head round the idea of a handset vendor talking about “LTE coverage”. The LTE coverage was already there!

These networks have a total of 300 million subscribers combined, noted Cook. But that’s not the only way Apple is looking to push forward. On the same call, chief financial officer Peter Oppenheimer added that Apple expects to spend “about $10bn” in capex this year, just under $2bn more than the firm reinvested  last year. The firm appears keen to preserve its culture of innovation and push the boundaries further than just ensuring the next iPhones and iPads are just taller, slimmer and faster.

Meanwhile, one could be forgiven for seeing the headline “Nokia records quarterly profit” and assuming it is an article from the archives, circa 1990. But no, this week, Nokia recorded an actual profit for 4Q12. An actual €439m profit in fact, up from a loss of €954m recorded in the same quarter of 2011.

Unfortunately for Stephen Elop and co, this doesn’t necessarily mean that Nokia is making a comeback to compete in the same league as big boys like Apple. Despite the turnaround, the Finnish firm saw quarterly sales drop year-on-year from €10bn to €8.04bn, while net sales for the year stood at €30.2bn, down from the €38.7bn recorded in 2011. The operating loss made by the firm in 2012 was more than twice as deep as that recorded a year earlier; down to €2.3bn from €1.1bn.

Victor Basta, managing director of M&A advisors to the technology industry Magister Advisors, dismissed Nokia’s result as “irrelevant” in the long term.

“Margins and prices for devices are eroding for all players. Unfortunately for Nokia the potential software value is now Microsoft’s, which has gained a key channel for Windows into the mobile channel without having to buy Nokia and its problems,” he said.

Still, given the troubles the company has had in recent years, it should serve as encouragement for Nokia.

Much of Apple and Nokia’s worries come in the form of a robust South Korean juggernaut, seemingly going from strength to strength.

Samsung announced net profits of 7.04tn won ($6.5bn) for the fourth quarter of 2012, with strong sales from its mobile division making a significant contribution. The firm’s profit was up 76 per cent on the same period in 2011, when the firm netted 4.01tn won.

Mobile sales for the three-month period reaped 27.3tn won, almost half of the firm’s overall revenue for the quarter of 56tn won. Operating profit for the IT and mobile division, which includes handsets and tablets, was 5.4tn won, up from 2.56tn won in 2011.

Samsung said sales of its SIII and Galaxy Note II devices had been particularly strong. These devices were more popular than their predecessors, Samsung said, setting new records for the speed and volume of sales. But smartphone demand in developed markets is likely slow in the first quarter of 2013, the firm acknowledged – and this is largely due to the threat from manufacturers of lower-cost devices.

“The furious growth spurt seen in the global smartphone market last year is expected to be pacified by intensifying price competition compounded by a slew of new products,” said Samsung. “In the first quarter, demand for smartphones in developed countries is expected to decelerate, while their emerging counterparts will see their markets escalate with the introduction of more affordable smartphones and a bigger appetite for tablet PCs throughout the year.”

Meanwhile, UK regulator Ofcom has announced that bidding for the 4G spectrum is underway. Seven firms have qualified to bid for spectrum auction and they will be competing for 28 lots of spectrum in two separate bands – 800MHz and 2.6GHz.

The regulator said that bids are being placed online over secure connections, using software that has been developed specifically for the auction.

The bidding will continue over several rounds and it is expected to be a number of weeks until the final winners are known. No updates on bidding activity will be provided until the conclusion of the auction. According to Ofcom, 4G services will be launched by a range of providers from late spring/summer 2013.

Efficient use of spectrum is becoming increasingly important in the UK – the country’s Ministry of Defence announced late last year that it will auction off around 200MHz of the radio spectrum it owns and now a research centre focused on developing white space technology has been opened at Strathclyde University in Glasgow, Scotland. The centre aims to work with players in the industry such as Microsoft, BT, the BBC and the UK government to develop technology that will tap into the unused white space spectrum.

Elsewhere, Swedish equipment manufacturer Ericsson has announced its intention to acquire the IT services capabilities of the Devoteam Telecom & Media operation in France. The deal will see 400 France-based IT services professionals join Ericsson, including the company’s TV SmartVision operations, which is in line with Ericsson’s strategy of being a ‘one stop’ shop.

Devoteam’s main competences are in the areas of consulting and systems integration for operations and business support systems, service delivery platforms and applications, IP Multimedia Subsystems, IP and radio networks and TV.

Also in the news this week, we’re all getting slower – at least in terms of broadband speeds. Despite the continuing roll-out of high-speed networks around the world, average and peak connection speeds actually declined by seven per cent between the second and third quarters of 2012 to 2.8Mbps, according to Akamai’s latest State of the Internet report. Despite the slight quarter-over-quarter decline, global average connection speed enjoyed healthy 11 per cent growth year over year.

The report, based on data from the Akamai Intelligent Platform, found that South Korea remains top of the pile for speed, with an average connection of 14.7Mbps, followed by Japan with 10.7Mbps and Hong Kong with 8.9Mbps.

Over in the Middle East, Saudi operator Mobily inked a partnership with enterprise cloud software and Infrastructure-as-a-Service (IaaS) provider Virtustream to offer cloud services to enterprises and small-to-medium businesses. Under the terms of the deal, Mobily will use Virtustream’s xStream cloud management software to run its public and hybrid clouds.

The deal means that businesses in Saudi will be able to move mission-critical applications, including legacy software, to the cloud, according to Virtustream. This would include applications such as those provided by SAP, Microsoft and Oracle, without needing to rewrite the software, the firm added.

Spanish operator group Telefónica has been particularly busy this week – the firm revealed plans to invest more in its fibre broadband networks in major cities such as Madrid and Barcelona this year, and also increase its fibre footprint in smaller cities like Bilbao and Seville.

In Madrid, the telco plans to extend its fibre-to-the-home (FTTH) network to new areas of the city like Alcorcón, Las Rozas, Boadilla del Monte, Villaviciosa de Odón, Torrelodones, Galapagar, Algete, Coslada, Valdemoro and Torrejón de Ardoz

Furthermore, El Tel announced it is looking to facilitate direct operator billing for customers in mobile app stores. The firm’s Telefónica Digital unit, which is tasked with “seizing opportunities in the digital world” and delivering new growth for the operator, has signed a global framework agreement with mobile payments and analytics company Bango. The two companies will partner globally to create an enhanced operator payment experience for app stores.

Seizing further opportunities in the digital world, Telefónica Digital also unveiled a web-based platform for the connectivity, management and control of M2M communications.

Smart M2M features real time monitoring of traffic type, volume and current consumption, technical supervision of lines including maps of connected devices, diagnostics and localisation. It also offers fraud detection functionalities, including the ability to restrict communications between a list of given devices or the possibility to establish traffic caps.

At the end of last year, Telecoms.com invited readers to complete its inaugural Telecoms.com Intelligence Industry Survey. Almost 2,000 of you did so, including 600 operator employees from 260 different operators worldwide. The Informer has had a sneak peek at the results of the survey and they provide very interesting reading indeed.

One of the interesting points the research discovered is that almost two thirds of the industry believes that greater consolidation is needed among mobile operators, with support emerging for the concept of single network markets.

64.6 per cent of respondents believe that further consolidation is needed in the mobile operator community. In line with this, when asked to rate a number of priorities for national telecoms regulators, respondents marked maintaining the number of mobile networks in the market as the least important. Less than ten per cent of respondents felt that this should be regualtors’ highest priority.

The survey also found that price remains by far the biggest influencer on operators’ selection of network vendors, more important even than technical performance of the equipment purchased. While technical performance was a close second to price, vendor attributes such as market share and legacy relationship were rated by respondents from across the telecoms industry as significantly less important to operators.

Price was ranked as very important by 43 per cent of respondents and as important by a further 41.8 per cent. Technical performance was a long way behind in terms of the number of respondents who felt it very important (24.6 per cent) although it was ranked as important by a larger number (47.7 per cent).

Despite the efforts being made in the automotive market towards enabling connectivity in vehicles, connected cars currently present the least potential service revenue opportunities for mobile operators, according to data from the Telecoms.com Intelligence Industry Survey 2013.

When asked to rate non-telco sectors on the potential service revenue opportunities they offer to mobile operators, 63.3 per cent of respondents rated the automotive sector as offering very low to average opportunity.

Conversely, 76.1 per cent of respondents saw high to very high opportunity in the payment/banking sector, and 71.7 per cent did so in the media content space.

The full results of the Telecoms.com Intelligence Industry Survey 2013 will be published on February 18th.

That’s about all for this week – take care.

The Informer

Nokia's Lumia 920

Struggling handset maker Nokia has posted an operating profit of €439m in 4Q12, up from a loss of €954m recorded in the same quarter of 2011. Despite the turnaround, the Finnish firm saw quarterly sales drop year-on-year from €10bn to €8.04bn.

Net sales for the year stood at €30.2bn, down from the €38.7bn recorded in 2011, while the operating loss made by the firm in 2012 was more than twice as deep as that recorded a year earlier; down to €2.3bn from €1.1bn.

The firm said in a statement that no dividend payment will be made to shareholders in 2012, to “ensure strategic flexibility”.

“We are very encouraged that our team’s execution against our business strategy has started to translate into financial results,” commented Nokia CEO Stephen Elop. “We remain focused on moving through our transition, which includes continuing to improve our product competitiveness, accelerate the way we operate and manage our costs effectively. All of these efforts are aimed at improving our financial performance and delivering more value to our shareholders.”

Nokia’s results are in the short term encouraging, but in the longer term irrelevant, according to Victor Basta, managing director of M&A advisors to the technology industry Magister Advisors. He added that the declining performance illustrates the importance of software in the mobile industry.

“Margins and prices for devices are eroding for all players. Unfortunately for Nokia the potential software value is now Microsoft’s, which has gained a key channel for Windows into the mobile channel without having to buy Nokia and its problems,” he said.

He added that Nokia’s one remaining chance at global importance lies in emerging markets.

“While price competition is intense there, Nokia has a strong brand name and distribution into key developing markets. They should consider splitting their emerging markets business into a separate company, which could apply greater focus on this major opportunity.”

Basta added that rival RIM’s next results are likely to underscore the same trend, as the Canadian manufacturer is also at heart a hardware company, and one without a strong software partner.

“RIM’s quarterly developments and new launches are, again, short term encouraging but irrelevant in the longer term. Without a software-centered strategy, neither RIM nor Nokia can have enduring value.”

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Nokia CEO Stephen Elop

Finnish handset firm Nokia has announced plans to cut its global IT workforce by 300 employees. The firm will also transfer part of its IT activities and up to 820 employees to Indian outsourcing firms HCL Technologies and Tata Consultancy Services.

The announcement marks the last anticipated reductions as part of Nokia’s focused strategy announcement of June 2012. The firm had pledged to cut 10,000 jobs by the end of 2013 as it adjust to its decline in the smartphone market. Nokia said that the changes will increase operational efficiency and reduce operating costs, “creating an IT organisation appropriate for Nokia’s current size and scope”.

The majority of the employees affected by these planned changes are based in Finland. Nokia added that it will offer employees affected by the planned reductions both financial support and a comprehensive support program. The firm is beginning the process of engaging with employee representatives on these plans in accordance with country-specific legal requirements.

Late last year, the handset firm agreed to sell and lease back its head office building in Espoo, Finland, because “owning real estate is not part of Nokia’s core business”. The firm said it received €170m for its headquarters from Exilion Capital Oy.

In October 2012, the firm posted its fifth consecutive quarterly loss. The firm recorded an operating loss of €576m ($752) for the quarter ending September 30, 2012, dwarfing the €71m loss the firm posted in the same period in 2011. Net sales also dropped 19 per cent year-on-year from €8.98bn to €7.24bn.

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]]> http://www.telecoms.com/73842/nokia-slashes-it-workforce/feed/ 0 Stephen Elop featured http://www.telecoms.com/57861/it%e2%80%99s-tough-at-the-top/?utm_source=rss&utm_medium=rss&utm_campaign=it%25e2%2580%2599s-tough-at-the-top http://www.telecoms.com/57861/it%e2%80%99s-tough-at-the-top/#comments Wed, 19 Dec 2012 16:24:10 +0000 James Middleton http://www.telecoms.com/?p=57861

Being recognised as a genius in your field is one thing, but creativity and innovation will only get you so far. To stay at the top you need the support of your team. Lose that, and your days are numbered no matter who you are.

This was the hard lesson learned by Scott Forstall, one of the original architects of the Mac OS X operating system and head of the team responsible for the software platform at the heart of the iconic iPhone device last month.

Out of the blue, Californian vendor Apple announced an executive reshuffle, which will see the departure of Forstall early next year and his status trimmed back to that of an advisor to CEO Tim Cook in the interim. The company did not expand on his reasons for leaving, but rumours suggest personality clashes at the top, as well as the fallout from the Maps debacle and ongoing issues with Siri.

But it wasn’t only Forstall that was for the chop. John Browett is also leaving after only five months as head of retail. A search for a replacement is underway, but in the interim the retail team will report directly to Cook. Again, the rumour-mongers suggest that Browett made some serious mistakes in his short tenure which didn’t do him any favours.

In other movements, famed designer, Jony Ive, who was responsible for everything from the iMac to the iPhone and iPad design is now going to “provide leadership and direction for Human Interface (HI) across the company in addition to his role as the leader of Industrial Design.” Meanwhile, Eddy Cue, senior vice president of Internet Software and Services, will take on the additional responsibility of Siri and Maps, placing all online services in one group along with iTunes, the App Store, the iBookstore and iCloud.

And Craig Federighi, senior vice president of Software Engineering, will lead both iOS and OS X development. Bob Mansfield, senior vice president of Technologies, will lead a new group, which combines all of Apple’s wireless teams across the company in one organisation and will also include the semiconductor team.

This all smacks of some serious tension at the top of the company’s management tree and leaves Apple without a dedicated veteran software lead or a retail chief in the run up to the holiday season. But it’s not the only company in this situation.

US software giant Microsoft recently announced the immediate departure of Steven Sinofsky, head of its flagship Windows and Windows Live operations. The move came just a few weeks after the launch of the company’s next generation software platform, Windows 8, which spans both desktop and mobile devices.

Microsoft did not give any reason for Sinofsky’s departure, which again is being attributed to personal differences in the management layer. But the move does raise questions over the future direction of Microsoft’s platform strategy and Sinofsky’s departure couldn’t have come at a worse time. After all, Windows 8 was billed as more than a simple product upgrade when it was launched, with Microsoft positioning it as a multi-device strategy that would embrace modern diversity in devices used to access services and content.

With Sinosfky gone, Julie Larson-Green will be promoted to lead all Windows software and hardware engineering while Tami Reller, who retains her roles as chief financial officer and chief marketing officer, will also assume responsibility for the business of Windows. Both executives will report directly to Microsoft CEO Steve Ballmer.

Since 1993, Larson-Green has worked on and led some of the most well known products for Microsoft, including the user experiences for early versions of Internet Explorer, and helped drive the thinking behind the latest iteration Microsoft Office. For Windows 7 and Windows 8 she was responsible for program management, user interface design and research, as well as development of all international releases.

Reller began her career in technology at Great Plains Software in 1984 and was the company’s chief financial officer at the time it was acquired by Microsoft in 2001.

So with two of the bigger players in the handset ecosystem tied up with internal issues, is there opportunity for the grass roots Linux movement to break through? A couple of players think so.

Former Nokia executives in Finland, disgruntled at the abandonment of MeeGo, set up their own mobile OS start up, Jolla Mobile, in the summer. A couple of weeks ago the firm offered the world a first look at Sailfish OS.

Moreover, in a show of support for domestic innovation, Finland’s third largest operator DNA said that it will distribute handsets using the OS upon its commercial launch.

In a similar vein, Spanish operator group Telefónica is one firm that has been vocal about its attempts to break free from the dominance exerted by proprietary players by putting its support behind open source software developer Mozilla’s Firefox operating system. Following Telefónica’s lead, operators Deutsche Telekom, Etisalat, Smart, Sprint, Telecom Italia and Telenor have now signed up to back the open Firefox OS as an option for delivering cheaper smartphones.

Mozilla recently released a prototype version of its lightweight mobile operating system Firefox OS. The OS is available as a prototype module, which developers can run on Windows, Mac and Linux computers.