“The Global Opportunities in a Wireless World Where Context is King”

Awesome speech by the Nokia CEO highlighting how context is going to take center stage of the mobile internet domain. We are clearly seeing the build out of Web 3.0 or the context aware web.

“The Global Opportunities in a Wireless World Where Context is King”

Nokia CEO's speech at the The Executives’ Club of Chicago Global Leaders Luncheon September 23, 2008

(Note: Speech as delivered may have varied slightly from the written text)

Good afternoon everyone, and thank you, David, for that fine introduction.

It is an honor to be among those who have addressed this distinguished organization, which for nearly a century has played such an important role in Chicago’s business community. I also would like to thank the Board of Directors and say “kiitos” to my fellow Finn, Kaarina Koskenalusta, for inviting me here today.

It’s always exciting to return to this vibrant city. Chicago is one of my favorite places in the world, and it is increasingly playing a critical role within Nokia.

Chicago was the first American city in which we opened one of our Nokia flagship stores, down on the Magnificent Mile, in 2006. More significantly, in July we completed the largest acquisition in our history: the acquisition of Chicago-based NAVTEQ.

NAVTEQ is the world leader in navigation technology, and will be involved in developing many of the innovations you will see today. We have several members of NAVTEQ’s management team here today, and I would ask them to please stand and be recognized.

Thank you!

As you can see, there is a strong connection being built between Helsinki and Chicago. It is a bond we expect to grow much stronger in the years ahead.

Chicago, of course, also has played a key role in the history of the telecommunications industry – as the home of Motorola. Motorola offered the first commercial, handheld cellular phone back in 1984, the same year Nokia introduced its Mobira Talkman. Our two companies have battled in the marketplace ever since.

Like many other companies in the current downturn, Motorola is facing some challenges. But Moto has always been a tough and respected competitor. I am confident it will continue to challenge us for many years to come.

In its early days, The Executives’ Club of Chicago had this slogan: “The Thinker and Doer.” Like many tech companies, Nokia spends a lot of time – and money – thinking about the future, and what we will do to prepare for it.

Nokia’s own slogan is “Connecting People.” Exactly what that means has evolved over the years as technology has evolved. But whether someone lives in a shantytown in Mumbai or in a luxury high-rise in Chicago, we all share a basic human need to connect to one another and to the world around us.

A golden age of mobility

At Nokia we are constantly looking for new and different ways to fulfill that need. That is what I would like to talk to you about today.

Our world is in the midst of a fundamental change in the way we connect and communicate. For years, our industry has talked about the pending convergence of the Internet with mobility. Now it’s happening.

Indeed, I believe we are entering a golden age of mobility. This is a change as profound as the invention of the motion picture, TV or the personal computer. We at Nokia call it, the dawn of “the fourth screen...”

We recently produced that video for a Nokia event focused on our music and game services. But the significance of the fourth screen goes well beyond entertainment.

Consider this: The world’s population today is around 6.5 billion people. One day next year, we will reach the point where 4 billion of those people will be using a mobile device. Four billion!

Just think about that for a moment.

That means this little screen eventually will become the most common way to access the Internet in the world. The biggest personal media distribution channel. The largest advertising vehicle.

It already is, in fact, the largest, most widespread communication medium mankind has ever known!

It also has been the fastest-spreading technology in the history of civilization. The first billion mobile phones were sold in about 20 years. The second billion were sold in four years, and the third billion were sold in two.

Most of you are probably old enough to remember back in the 1980s when cell phones looked like this. They cost thousands of dollars and a call was more than a dollar a minute. I still remember how cool I felt when I impressed my friends by making a wireless call!

How things have changed.

Since then, of course, the mobile phone has shrunk dramatically. At the same time, it has been assuming the roles of other electronic devices.

Our Nokia E71 smartphone can do so many things that calling it a “cell phone” seems inaccurate. It’s really a portable, multimedia computer. It takes pictures, plays music, video and games, and lets you watch movies and TV. It tells you how to find your way, lets you surf the Web, and predicts the weather. And it also keeps you in touch by email, text message and, yes, even by phone.

It’s no coincidence respected companies like Apple, Google and Microsoft have become very interested in the fourth screen. The potential business opportunities of a connected, wireless world are limited only by our imaginations.

Context is king

The title of my speech today refers to “a wireless world where context is king.” And I’m sure some of you are wondering what that means. Context has become something of a buzzword in our business, because it is at the heart of the next wave of mobile technology.

It’s pretty simple, really. When we speak of “context,” we mean the ability of your mobile device to connect you, and what matters to you, with your location and what’s around you.

Let’s look at an example. It’s an application we call “Point and Find.”

Say you are an architecture buff and you’re visiting Chicago for the first time. You turn a corner and see an interesting building, and you want to know more about it.

You take out your Nokia device and you point it at the building. The device then immediately provides detailed information via the Internet: when it was built, the architect, its history and significance, maybe even the hours when tours are available.

Or imagine you’re walking downtown and you see a poster for a new movie. You point your phone at the poster and instantly you can watch the trailer. If you like what you see, you can find where the movie is playing, and even buy tickets for that evening’s showing – all with just a couple of clicks.

This isn’t really future stuff. In fact, as a first step in making this a reality, we will soon be introducing a beta version of the Point and Find movie service.

This is context. It’s the ability of your mobile device to bring who, what, where and when together. It will allow you to become more immersed in the real world around you. And it will do that by linking the power of the Internet to a small device in your pocket that always knows where you are – even if you don’t!

Getting you where you need to go

We decided to partner with NAVTEQ precisely because navigation technology is a key ingredient in the menu of services we plan to offer our more than 1 billion customers. NAVTEQ’s expertise clearly gives us a leading competitive edge.

Many of our phones now come with sophisticated navigation software that gives turn-by-turn directions while driving. Some are now offering pedestrian navigation as well, which is great when you are trying to get around an unfamiliar city on foot.

While mobile phone navigation is just starting to penetrate this market, our studies show it has already become one of the top mobile services globally. The others are photos, music, games, email and messaging.

While devices will remain the core of Nokia’s business, we are expanding rapidly into services. We anticipate the Internet services market could total about $150 billion by 2010.

Navigation is obviously a helpful tool as we expand the kinds of services and applications we offer. But imagine a device that actually anticipates what you want, maybe even before you know what you want!

Pretty soon, simple sensors built into your mobile device are going to change the way you shop, and make it far easier to access the information you need at a moment’s notice.

These sensor-equipped devices offer huge potential as an advertising medium – in ways that will benefit both business and the consumer. Of course, when I mention this the first reaction of many people is, why would I want advertising on my phone?

Again, it gets back to context.

Traffic Works, advertising and sensors: a glimpse into the future

The average person is bombarded by more than 3,000 advertising messages a day. Context-aware mobile devices equipped with sensors will reduce the clutter and noise. That’s because you will be able to determine the kind of ads you want to receive, about the products you are interested in.

That’s something most of us would appreciate. By tailoring advertising to your precise interests and your location, the information becomes much more relevant. For businesses, it means you can target your advertising to customers who want it and are more likely to act on it.

These sensors and filters will soon become as widespread on mobile devices as digital cameras are today.

Here’s another interesting way mobile sensors will make our lives easier. It’s a traffic management project called “Traffic Works,” which Nokia has been working on with California transportation authorities and the University of California.

It involves using sensors in drivers’ mobile phones to detect traffic problems and congestion patterns as they develop.

In the future, as you leave home, your phone will know where you are headed based on the calendar entry in your device. Data collected by the sensors in other drivers’ mobile devices will allow your phone to suggest the fastest route. If conditions change on the way, your phone will warn you and offer new directions to help you avoid a tie-up.

For transportation authorities, these mobile sensors offer a lower-cost, more efficient alternative to traditional traffic sensors buried in the pavement.

On an even more personal level, biometric sensors in our devices will allow us to monitor our own heart rates, our blood pressure and our vitamin levels. Or allow us to check air quality or noise levels where we live and work.

The goal is to turn your context-aware mobile device into an indispensible assistant … one who knows in advance what your preferences are, anticipates your needs, reduces information overload and improves your quality of life.

Nano-technology and the Morph concept

The late science fiction author and futurist, Sir Arthur C. Clarke, once said: “Any sufficiently advanced technology is indistinguishable from magic.”

I’d like to share with you a bit of magic.

One of the challenges in our business is keeping up with the pace of innovation, and making the right decisions about what the next big thing will be. It means you sometimes have to take risks. It means you need to pay close attention to innovations in areas of science that may appear completely unrelated to your business.

Here’s a good example.

Nano-technology doesn’t usually make you think of mobile phones. But our designers and researchers recently produced a fascinating concept called “Morph.” It shows how nano-technology could radically change how we use and even “wear” or mobile devices.

Together with the University of Cambridge Nanoscience Center, our researchers are exploring innovations like transparent electronics and self-cleaning surfaces.

Imagine mobile devices that are stretchable, flexible, and ultra-personal.

You can see here how these devices might work. They are able to adapt to different needs or situations – time after time, again and again. Wearable like a bracelet, you can fold it into a variety of shapes. Yet it’s still useable as a normal phone.

One of the benefits of nano-technology is you can create devices with a self-cleaning cover, where spills simply roll off.
But I think the most interesting aspect of Morph is it allows for infinite options to personalize your device. You simply use the built-in camera to capture a pattern or color, and then transfer it to the phone. It becomes part of you, and your personality.

And this is not just an idea or a theory. There is real research going on in our labs to make Morph a reality, and sooner than you might expect.

Technology development helps sustainable business

As we look to the future, we are also looking at how to make our products environmentally sustainable – from design to production, to recycling and energy consumption.

We see this as an opportunity rather than a constraint. The fact is, in most cases, doing things in a more sustainable manner also makes good business sense.

Earlier this year, we showed this concept for a mobile device made entirely from recycled and renewable materials. It’s called “Remade.” And I expect you will be seeing its features on your phones in the not-so-distant future.

This phone also uses a zero-waste charger that automatically shuts off when the phone is fully charged. That may not seem like such a big deal. But if everyone who charges a mobile phone unplugged it when its job was done, it would save enough electricity to power 100 thousand homes.

Again, to borrow from your club’s old slogan, it’s about not just thinking, but doing.

Making a difference and improving lives the world over

Ladies and gentlemen, I hope I have given you some feeling for why we at Nokia are so excited about the future – a future where “context is king.”

But I would like to conclude today with a few words about serving the mission implied in our slogan, “Connecting People.”

Our industry spends a lot of time debating these future technologies and how they will further enrich our lives. And that debate is important. But it’s also important to remember that the simplest innovations often make the biggest difference in people’s lives.

Nokia has been very successful in the regions of the world where the number of mobile phones is still growing at an amazing pace, including India, China and Africa. We have succeeded in these markets because we take the time to understand the unique needs of people in each of these countries.

Our research led us to develop phones with built-in flashlights to help customers in areas with frequent power outages. Globally, we have developed user interfaces in more than 80 languages, which has been critical to spreading this technology to more people.

In poor villages, it’s common for many people to share a single phone. So we have phones with multiple address books and software that tracks prepaid phone credits. We have designed inexpensive phones, which are incredibly rugged and simple to use, with features to make life in difficult surroundings a bit easier.

These innovations get virtually no attention in the tech blogs or in the hallways of Google or Apple. But getting a simple “fourth screen” in the hands of people struggling to make a living in remote villages or crowded cities does far more to improve lives around the world than 10 million iPhones, Blackberrys – or E71’s for that matter -- ever will.

Providing affordable mobile phones in places like India and Kenya means fishermen can now call ahead to find the port where they can get the best price for their catch. It means a mother in Uganda with a sick child can call the doctor in a far-off village for treatment advice – and potentially avoid a three-day journey.

The impact that the simple mobile phone is having on the quality of life in the poorest parts of the world is often overlooked. The many small improvements in human efficiency that it affords, multiplied by billions of people, are reshaping the global economy in ways we are only beginning to understand.

To me, this is what “Connecting People” is all about: Improving people’s lives by meeting the basic human need to communicate, to connect. It is the most important thing we do.

Thank you.