Nokia Lending Downgraded, Shares Fall, No One Cares

Nokia shares fell yesterday after ratings agency Fitch cast aspersions on the Finnish giant’s future.

Fitch downgraded Nokia’s lending rating from BBB+ to BBB-, meaning that risk averse investors like pension funds will not buy long term bonds from Nokia.

Fitch said that they were concerned that it would take Nokia too long to launch  “a tested new product portfolio based on the Windows operating system”

They also commented that;  “The pace of deterioration has picked-up since Nokia decided to switch to an alternative operating system and it appears consumers are deserting these legacy handsets for cheaper Android (Google’s operating system) versions or high-end Android or Apple smart phones.”

They really didn’t pull any punches, and seemingly laid the blame on Nokia’s decision to go WinPho, but we’ll never know what the rating would have been had Nokia stayed with it’s Symbian OS.

The short version is that Nokia won’t have a solid new product line up until next year, and when they do it will be running an OS that no one seems to be buying.

It could be that Nokia’s hardware and Windows Phone will morph together like Power Rangers to make something greater than the sum of it’s parts, but Fitch seem to think otherwise.

Microsoft dumped a massive pile of cash on Nokia to get the Windows Phone deal, but the pace at which Android and iOS handsets are disappearing over the horizon leaving Nokia and MS behind means that any attempt to make up the lost ground will be expensive. Quite how much money MS are prepared to flush spend on Nokia’s marketing remains to be seen.

My guess is a lot,  a truly staggering sum of money.

MS aren’t known for backing down from a fight, or admitting defeat on failing product lines. Unlike Google who regularly pull the plug on projects that aren’t working, MS will more than likely spend vast sums marketing WinPho for the foreseeable future, simply using cash to try and brute force some market share.

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