Better Never Than Late: Nokia Jumps Into the Tablet Fray

As Apple (NASDAQ: AAPL  ) debuted its new iPad Air and Mini refresh yesterday, Nokia (NYSE: NOK  ) quietly introduced its first Windows tablet. Though some of the Lumia 2520 features are nice, there are several reasons the device is destined for failure.

Lumia 2520. Source: Nokia.

Pricing itself out of the game
On the outside, the Lumia 2520's styling is on par with its smartphone cousins, a smart move by Nokia in building a cohesive brand. The tablet sports a large 10.1-inch display, Qualcomm's impressive Snapdragon 800 processor, LTE connectivity, and comes with Nokia's HERE offline mapping app.

But where the 2520 takes a wrong turn is its $499 price tag. Nokia's polycarbonate shell doesn't have the same build-quality as Microsoft's (NASDAQ: MSFT  ) VaporMg magnesium-alloy Surface 2, which sells for $50 cheaper. But the real problem is that the Lumia 2520 is priced exactly the same as Apple's new iPad Air.

Microsoft has priced its Surface 2 at $450, knowing that it can't compete with Apple's name recognition in tablets and robust app ecosystem. But the Nokia 2520 starts at the same price as the new iPad Air, and then goes up from there. The new tablet is designed to function like a PC, with its Power Keyboard. The accessory is a full-sized keyboard with trackpad, two USB ports, and an additional five hours of battery life. While those features are impressive, it comes with an additional $150 price tag.

This means that a Nokia Lumia 2520 at its peak of functionality, battery life, and usability will cost consumers $650. That's a hefty price tag from a company that has never sold a Windows tablet before and is in the process of selling its devices and services to Microsoft.

Apple has sold 170 million iPads since it debuted the device, and sold an estimated 15 million the quarter ending in September. The company has 475,000 apps designed specifically for the iPad, and Apple won J.D. Power and Associates' highest ranking for tablet owner satisfaction earlier this year. Add all of that up and it's easy to see how the Lumia 2520 stacks up against the iPad.

But wait, there's more.

The 2520 runs the all-but-abandoned Windows RT operating system. Before Nokia's tablet debuted, Microsoft was the last hardware maker using RT. Dell, Lenovo, Samsung, and Asus have all dropped the OS because of a lack of consumer interest. It's highly doubtful that in Nokia's current position it can turn around Windows RT.

Whatever Nokia's intentions for the Lumia 2520 were, the tablet will probably have a short and insignificant life. Needless to say, Apple investors don't need to be worried about the new device.

With Nokia in the middle of selling its devices and services to Microsoft, Nokia investors shouldn't focus too much on the tablet, either, but rather on what will remain of the company after the sale. Microsoft investors probably have the most interest in how the new tablet does, as it's likely to become part of the company's business in some way. But don't expect the Lumia 2520 to be an eventual saving grace for Microsoft's tablet business. The company is busy building the Surface brand, so Microsoft would likely only glean small cues or technology from the tablet. Unfortunately, Nokia's timing couldn't be worse.

A better tech bet
Though Nokia may not be in the best position to benefit from tablets, Apple certainly is. But Apple has a history of cranking out revolutionary products... and then creatively destroying them with something better. Read about the future of Apple in the free report, "Apple Will Destroy Its Greatest Product." Can Apple really disrupt its own iPhones and iPads? Find out by clicking here.


Read/Post Comments (8) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 23, 2013, at 7:21 PM, kellenbmiller wrote:

    I don't get the comparison? Nokia comes up with a touchscreen device. Where you have millions of copy written software and patented hardware. Not very many companies in the world can do it. Not without paying everyone else to do it. I think they should be proud of it. People will come aboard. Never give up they say.

  • Report this Comment On October 23, 2013, at 7:27 PM, kellenbmiller wrote:

    I have the Iphone 5 but I do not like the Ipads. I use a PC at home. Bamboo has neat Idea that lets you connect to your device and control it as if you were touching the screen. It uses all of the gestures. But It needs a keyboard printed on it so when you activate text. You can see where to put your fingers.

  • Report this Comment On October 23, 2013, at 7:40 PM, techy46 wrote:

    Fools - The 2520 runs the all-but-abandoned Windows RT operating system.

    Umm, Windows Phone runs in Qualcomm ARM and is Windows RT. Why would MS abandon WRT when it's the basis on Windows Phone. The reason Nokia couldn't support SMP processors was the original WP was Win CE based. It will be real interesting to see if MS Nokia adopts Intel phone chips in 2014. The Lumia 3520 with Intel Inside.

  • Report this Comment On October 23, 2013, at 7:41 PM, lee654 wrote:

    I like , I'll buy 3 !

  • Report this Comment On October 23, 2013, at 8:33 PM, techy46 wrote:

    MS has hidden the Desktop tile in WRT and will do away with it when Office 2014 for Metro UI is ready. WRT is not abandoned or dead.

  • Report this Comment On October 23, 2013, at 9:03 PM, Walter118 wrote:

    I wish Nokia's devices have more articulate supporters armed in good knowledge of great, outstanding features which make all those iPods', including the latest models simply inferior to L2520, if only mentioning, superior imaging system, superior audio (4 mics), superior mapping (off line), better connectivity (LTE, WIFI), Office app included and quite a few significant more. L2520 is much better device, HANDS DOWN, than all the iPads introduced by Apple so far put together. Consumers will soon discover the truth, no doubt. Even that tired gimmick with million apps in Apple's store won't help because MS already has all essential ones to offer.

  • Report this Comment On October 23, 2013, at 9:18 PM, rchaudhary wrote:

    Windows RT may die not because it was a bad concept, but because of bad implementation and marketing.

    There is definitely a market for an OS that is more than Phone based OS (iOS, Windows phone, Android) and less complex & powerful than a full blown Windows Desktop.

    Windows RT should have been renamed as Windows Tablet OS and made agnostic of underlying processor.

    Comparing Nokia tablet with Apple or Google Nexus is wrong because they are different eco-systems.

    It should be compared with other Windows tablet and its unique because you get GPS and LTE support for $500. That makes it a great tablet for business and those who are on the move.

  • Report this Comment On October 24, 2013, at 11:13 AM, sami1971 wrote:

    Neither the Surface 2 nor the new iPad come with LTE at the starting price, do they? GPS and offline maps? Price of the RT tablet is pretty damn good actually when you consider what you get for the money.

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