Nokia's Top Technology Officer Departs, Maybe for Good
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The Finnish cellphone maker Nokia said on Thursday that its chief technology officer had taken a leave of absence and would be temporarily replaced by the head of the company's research center.
News of the departure of Richard L. Green, an American who joined Nokia last year from Sun Microsystems, came as Standard & Poor's cut Nokia's long-term credit rating for the second time this year.
Nokia said Mr. Green had taken a leave "to attend to a personal matter." Paivyt Tallqvist, head of media relations at the company, based in Espoo, Finland, said there was "no specific timeline" for his return.
In his absence, Mr. Green will be replaced by Henry Tirri, head of the Nokia Research Center, Ms. Tallqvist said, adding that the change would have "no impact on our product strategy or our product launches."
Earlier, however, a Finnish newspaper reported that Mr. Green was unlikely to return because of disagreements over strategy.
Without citing its sources, the Helsingin Sanomat newspaper reported that Mr. Green was unhappy with management decisions, including abandoning plans to introduce devices based on the MeeGo smartphone operating system that had been under development with the chip maker Intel.
The appointment of Mr. Tirri is seen by some analysts as a return to basics, and a focus on chips, motherboards and transmission technology. He has been at the company since 2004 and is also a professor of computer engineering at the Helsinki University of Technology. His résumé highlights a host of publications on subjects including information modeling, neural networks and data mining.
Nokia remains the biggest producer of cellphones globally, but its market share has been sliding. At the premium end, it has been losing ground to the Apple iPhone, the BlackBerry smartphones from Research in Motion and devices using Google's Android software.
At the low end, phones from companies like ZTE of China and Micromax of India have been gaining ground, as have no-brand manufacturers -- generally small Chinese companies -- that have been gaining sales in India, China, Africa, Latin America and Russia.
At the end of last month, Nokia said that mobile phone sales in the second quarter would be "substantially" below a previous forecast of 6.1 billion euros to 6.6 billion euros ($8.9 billion to $9.6 billion). The company attributed the lower sales to difficult conditions in China and Europe and lower average selling prices and volumes than expected.
Stephen A. Elop, the former Microsoft executive who became Nokia's chief executive in September, is hoping to recover lost ground by switching Nokia phones to Microsoft's Windows Phone software, abandoning Nokia's own Symbian platform. That switch is expected to take place at the end of this year or early next year.
The alliance with Microsoft was announced in February and has been seen by some analysts as a possible precursor to a more extensive relationship between the two companies.
The company's shares were little changed Thursday afternoon at 4.30 euros ($6.29) in Helsinki, Finland. Since the beginning of this year, the stock has plunged 44.6 percent.
On Thursday, Standard & Poor's cut Nokia's rating by one notch, to BBB+; three further downgrades would classify the company's debt as below investment grade, or junk. Another agency, Fitch Ratings, downgraded the group this week to BBB-, just one level above noninvestment grade.
As it tries to lift sales, Nokia also has been trying to trim costs. It said in April that it would eliminate 12 percent of its global work force, or 7,000 jobs, to help save 1 billion euros ($1.5 billion) by the end of 2012. In a leaked memorandum this year, Mr. Elop compared the company's predicament -- trying to catch up with Apple and Google -- to that of a man standing on a burning oil rig at sea.
Nokia's struggles have made the company vulnerable to a takeover. Potential buyers mentioned recently include Samsung Electronics of Korea, Chinese groups and private equity firms.
"I think Nokia will play defensively until the Windows phone ramps up, and then it will push to find a slot in the business end of the market, stressing compatibility with personal computers," said Ilkka Rauvola, an analyst at Danske Markets in Helsinki.
Mr. Green reported directly to the chief executive. Previously he was executive vice president for the software division of Sun Microsystems, where he had broad responsibility for Sun's software business, including services, sales, product and business strategy, and product development. Mr. Green could not be reached for comment.
First Published June 10, 2011 12:00 am