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First results from the 2011 survey: Nokia and mobile platforms

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The 2011 survey has been going on for approximately a week now. The first invitation letters arrived at the companies in last Thursday, the day before easter vacations. We sent out the email invitations on this week's Tuesday and Wednesday. The total number of firms that were sent the postal mail was 5 490 and we have a working email address for estimated 3 169 firms. Compared to last year, these numbers are slightly smaller because we eliminated all sole proprietors from the mailing list and generally have improved the screening process for firms when creating the address list.

Now at Friday noon we have 144 completed responses in our online survey system and 47 returned paper questionnaires. In all, this compares favorably to last year and we expect a slightly better response rate than last year.

First look at the results

Before going into the results, there are two caveats that need to be pointed out. First, the early respondents are generally not representative of the entire population. This means that when we get more data, the results will likely change. Second, the survey covers the entire software industry. Although the high-growth firms and large firms receive most visibility, a typical software firm is relatively small and does not necessarily grow that fast. The data for these analyses are the online responses that we had at the end of office hours on Thursday. These consist of 127 firms that had a median revenue of less than 300 000 euros. 

People have been particularly interested in results relating to Nokia's decision to adopt Microsoft's Windows Phone as their primary smart phone operating system, as I explained in my previous blog post. Hence I decided to start analysing the two question set that were newly included in this year's survey and address Nokia and mobile platforms.

The figure below shows the responses to a question where we presented eight statements about the Nokia's strategy change. The respondents rated these statements on a five-point scale from "Completely disagree" to "Completely agree". The bars show the shares of the five possible responses blue being the "Completely disagree" option, yellow the "Completely agree" option, and the other colors the options between these two extremes. The N below the figure shows how many companies provided data for all these questions.

Since these are just early results, I will not analyze this figure indepth at this point. However, there are a few points that I would like to make:

  • The firms are evenly divided on whether the Nokia's strategy change has a positive impact on the software industry. The firms considering this as a negative event probably think more about the layoffs while the firms that consider this as a positive event probably think more on the lines that this increases the number of talented people available for the independent software vendors in Finland.
  • More than half of the companies chose "Completely disagree" to the staments about negative effects on their business. What this means is that although a large share of the largest software companies in Finland (e.g. Tieto, Ixonos, Digia) do depend on Nokia, this does not seem to be the case for smaller companies.
  • Firms are divided on their stance on hiring ex-Nokia employees. This is probably more related to the overall hiring situation of the firms rather than layoffs by Nokia.

In all, it seems that the software companies in Finland are not terribly worried about the changes that Nokia is currently undergoing. On the other hand, these companies do not seem to see the availability of Nokia employees in the job market as a great opportunity either. Howerever, these are just early results from the first responses. Once we have more data, we will publish more indepth analysis of these questions if not as a blog post, then at least in our final report that will be published in June.

The second issue that has received attention is on which platforms companies develop on. In the figure below, I have included descriptive statistics on the responses to a question where we asked the firms to indicate for which platforms they have developed software for in 2010 and are planning to develop software for in 2012. These dates were chosen since Nokia did their announcement after 2010 and we expect most companies that react to the announcement to do this by the end of 2012. The bars indicate the share of firms that chose a particular option in the multiple choice question. 

The results in this figure are interesting. Although I do not personally believe that in 2012 a fourth of the Finnish software companies would develop software for Android and a third for Windows Mobile, it is clear that these platforms will increase their popularity. At least two reasons come to mind to explain the high frequencies that these platforms were chosen. First, it is very likely that the early respondents to the survey are younger and more dynamic and when the more stable firms respond later, the figures will go down. Second, firms in the software industry tend to be overly optimistic in their predictions. Again, there are a few observations that I can make relatively confidently:

  • Symbian and iOS are currently the two most popular mobile platforms in Finland.
  • Software firms see Android and Windows Mobile as the platforms with the most potential and I expect these to be the most popular development platforms in 2012.
  • A large share of firms that currently develop for Symbian will discontinue this in the near future.

We will be posting more results in this blog as they are available. Now that we have a good number of early responses in our use, we will probably publish blog post more frequently than what we did prior to launching the survey.