Yearly Archives: 2013

Microsoft buys Nokia

Nokia’s 98,000 employees [1] will probably not be delighted to learn about today’s announcement to sell the core of Nokia, its mobile phone business and mapping services for a total of 5.44 billion € to Microsoft.

According to the press release, the transferred units represent ca. 50% of Nokia’s revenue. The low price tag (€3.79bn cash plus €1.65bn for patent licenses) is amazing: In 2011, Nokia had a turnover of $50.18 billion (2012: $39.91bn). Compare that price/revenue ratio to those of other recent technology company acquisitions (or IPOs) and you’ll see how desperate Nokia has become in a very short time.

The man behind the last three years strategy is Steve Elop, who was hired away from Microsoft to lead the ailing firm back to the upper ranks of mobile phone manufacturers in 2010. He has been called a mole and a trojan horse before (indeed, already at the press conference at his inaugeration), an accusation that he has denied. His immediate strategy of focusing solely on Microsoft phone as the single operating system, was heavily critisized by Ex-Nokia executive Tomi Ahonen among many others (see, e.g. The Elop Effect). Elop is now expected, as the MS press release states, to transfer back to Microsoft.

The series of events is peculiar at very least, I have to say. If it looks like a trojan horse, walks like one and quacks like one, ….

As a result of its failed strategy, Nokia has not been doing well during the last years. In the second quarter of 2013 Nokia has been shipping 7.1m Windows smartphones, which is puny compared to Android smartphone sales of Samsung (73.3m), LG (12.1m), Lenovo (11.4m), Huawei (10.2m), or ZTE (10.2m) during the same time frame. [2]

So what is now left of Nokia? The network unit Nokia Solutions and Networks, formerly known as Nokia Siemens Networks and which was founded in 2007 as a joint venture. However, core network hardware is coming under severe pressure as Chinese manufacturers such as Huawei are gaining ground.
There seems to be a mapping division left (but not their apps), as well as a division for Advanced Technologies.

So far, consumers and technology firms have not warmed up to Microsoft on their mobile phones. It will be interesting to watch if they will do so now that Nokia and Microsoft are under one roof. And it will be interesting to see what the rest of what is still Nokia will become in the following years (my guess is that it will be snatched up by a Chinese company?).

The reactions have been interesting, from techcrunch.com predicting Elop’s ascendency to the throne of Microsoft, to sad eulogies. Nokia’s share price jumped from 2.96 to 4.28 on the day of the announcement.

[1] src: Heise.de
[2] src: IDC Worldwide Mobile Phone Tracker, August 7, 2013

A case of plagiarism at ETH

Much has been written about the increasing levels of article retractions during the last months. Often, peers, reviewers, and student mentors have been criticized for not doing their job. I believe that we do have a responsibility for bringing these cases to light. However, as long as organizations – afraid of negative publicity – fail to enforce strict penalities, the problems will remain.

My previous employer, ETH, just has withdrawn the degree of a student after it found a case of plagiarism. However, she can re-enroll, reclaim her course credits and rewrite her thesis with a new topic. WOW, what a punishment. It reminds me of the story of the 1980s Budapest railway system, where the penalty for dodging the fare was … the price of a regular ticket. I have heard similar stories of my previous alma mater, the HSG, although I cannot confirm these from my personal experience.

Detecting plagiarism as a mentor of a thesis, or as the reviewer of a paper is hard, it is really hard work. Why would I invest my time and go through the hassle, if I know that fraud will not have serious consequences?

I have been waiting for the report of an Research misconduct committee dragging out their report for more than a year, while the retraction count of a German professor skyrockets to at least 12 retracted articles with no report and no consequences in sight. The same university only took a month to give an already retired professor a mild slap on the wrist for publishing a student’s work as article without any mention of said student. Why would I expose myself accusing peers when nothing is going to happen?

I do not aim to punish people for minor errors ("only those who don’t work do not make mistakes"). And I certainly do not appreciate the digging out of 30 year old dissertations just for the sake of detecting plagiarism. But organizations should face uncomfortable realities and implement harsh penalities once serious fraudulent activities are detected and made public.

Booking a travel

Using modern technology platforms to book a travel, using the modern web 2.0 should be a no-brainer, right? This is what I thought yesterday when starting to book a simple travel from Zürich to Hamburg an back.

So first, do your citizenship duty and check out the railway system (yes, I am ecologically biased). German Bahn has a “Switzerland special” for 39€ one-way, great… But their web form only allows to select a German station as departing place and a return trip starting in Switzerland. There is no way to book Switzerland-Germany-Switzerland. grr. So off to http://sbb.ch and book there: enter all travel details, select discount cards etc, just to be informed that (unspecified) parts of the trip Zürich-Hamburg can not be booked and therefore no booking at all is possible.
So back to http://bahn.de, skipping all discounts and simply enter Zürich-Hamburg in the regular web mask. It is great that they offer me to enter my Swiss half-fare card or my German half-fare card, but that is an “exclusive or”, I can enter either my Swiss or my german half-fare card for a trip spanning both countries. Fail again! Price: 220€ for the discounted cheap tickets bound to a specific train.

So off to the flights: expedia.de offers a direct 230€ Swiss/Lufthansa flight, so I’ll go for that. (1.1h rather than 8h of traveling time is more attractive). Enter details, skip rental car and insurance options, just to be informed that the flight is now 270€ rather than 230€. Suckers. Off to http://lastminute.de, booking the very same flight for 230€.

Conclusion? Digital markets might be true enablers, but their execution is still lacking. Also in-transparent price design can be something rather frustrating for the consumer.

When one door closes, another opens

I should have written about this quite some time ago, but never got around to actually do it. The last months have been exciting. I handed in my habilitation at ETH Zurich and it passed end December. Starting February 1st, I can now call myself a “Privatdozent ETH“, having been awarded the Venia Legendi (Teaching credentials) in Management Sciences.

Joel West, Joachim Henkel, Juliana Sutanto, and of course Georg von Krogh have steered me through the habilitation process, and I will always be grateful for the volunteer effort that they’ve put into this.

So far so good. But this also implies that my time at the ETH is coming to an end. I actually attempted to remain in Zurich and applied at both ETH and University of Zurich — to no avail.

I have been applying at a few Universities in Germany during 2012, and out of 5 applications was invited to present at four Universities (no, I will not publicly shame the one University that did not respond for seven months at all, rejecting me with a 2-liner).

Rufannahme

©Forschung und Lehre 2013

Prompted by this announcement in Forschung und Lehre in February 2013, I am very, very happy to announce that I successfully negotiated with the University of Hamburg in December 2012, and that I am in the process of getting my chair at the University starting in July 2013. In Hamburg, a city of media publishers and technology startups, I will be the heading the Chair of Management, specifically Digital Markets, at the School of Business, Economics and Social Sciences. More specifically, I will be located in the Department of Socioeconomics, the Fachbereich Sozialökonomie.

This implies a lot of changes, all of them exciting, and most of it to the positive:

For the first time in my life I will have a working contract that is not time-limited at the outset. This means a lot to a man whose hair is getting gray and whose kids are growing up. It also means being my own boss for the first time in my life and being the boss of a few others depending on me. This is going to be a tremendous challenge and one that I look forward to.

Research-wise, I will be even freer to pursue the topics that I am curious about. While my current chair of strategic management and innovation is broad enough to let me follow my research interests, digital markets and digital technologies have always been the core of my curiosity. Georg von Krogh has always given me all the academic freedom that I need. Let us not talk about resource endowment at this point though…

Teaching-wise, this will be quite a change. I will have to do more teaching that I ever had done, and I will have to do it in a system that I have not been part of for 13 years. I have already been struggling with lecture directories that require abstracts to be in (exclusively) German for courses that are going to be taught in English as part of an International Master’s programme. Oh well, may you live in interesting times…

Family-wise, it is a relief to be living closer to our families, and to actually have family members living in the same city.

I look forward to collaborate with new colleagues, such as Jetta Frost, Mark Heitmann or Dirk Gilbert, and also to be able to renew collaborations with other colleagues such as Jan Lungberg, Bertil Rolandsson, Linus Dahlander, Christina Raasch, or Oliver Alexy.