Our Business
Product leaks just lead to trouble & headaches for all
By Charlie on 20 June 2008
ESPOO, Finland - There is no doubt, now that the product has been launched officially, that the Nokia E71 takes the crown as the most leaked product I have ever known at Nokia. And, with such distinction in mind, now is a good time to discuss product leaks, their impact, and hopefully get a discussion going that benefits all of us.
I don’t want to turn this article into a whining-fest, nor point blame at someone. The whole history of some product leaks in the past few months is a mixture of dumb moves, broken NDAs, maybe some thievery, and possibly someone with best wishes.
I’ve written about this on my internal company site, and it generated lots of comments. It was interesting to see that the comments I got pretty much reflected my own feelings about the subject. Indeed, I give Nokia the benefit of the doubt and stick to the company line: we do not discuss products that are not officially launched publicly.
How leaks happen
One easy way for leaks to happen is if we or a distributor make material available before the announcement. Indeed, not naming names, it has happened a few times these past few months. These are very frustrating, since it’s our own darn fault.
Another way is for employees to inadvertently (or ‘advertently’?) blurt out a product code name or show a product publicly. That then causes a flurry of folks to search for clues, pictures, and other materials to substantiate the incident.
These forms of leaks seem innocent enough, and seem to be resolved by a bit of care, but still are a serious matter. They are indeed breaches of non-disclosure agreements (NDAs) that specifically state that pre-launch information is property of Nokia and cannot be revealed outside the company.
More legal troubles
A more serious form of leak is when an employee gives a pre-launch prototype (or photos or other media) to someone outside the company. While we can understand photos getting out, you can imagine our shock at a full hands-on review of the E71.
That was a prototype E71 property of Nokia, that was purposely sent by someone to the reviewer. I really am not a legal eagle, but it really seemed akin to handling stolen property and the employee or person who sent the phone is probably liable for illegal exchange of trade secrets.
Ok, as a gentler alternative to theft, we just hope that in reality it was a well-meaning employee who wanted to create some buzz around the E71, though they never consulted the teams that generate buzz through legal means. But, there are legal issues that can be brought against Nokia for potentially manipulating the market. And we all know the road to Hell is paved with good intentions.
Impact of leaks (where I get to whine)
Aside all the legal issues around dealing in trade secrets, there is the aspect of why we keep products secret until we launch them. Until a product hits the market, it’s still getting the final tweaks. Even when we launch it, there might be a lag time before we’re ready to release the product in the wild, so it would be better to show the device under controlled circumstances so that there are no misperceptions or frustration over an almost-finished product.
Also, the whole consumer electronics industry is set up on a product launch cycle method for communicating, building market and sales, and supporting products. When a product goes out, it’s not just put on a shelf, there are pricing deals to be made, sales and marketing campaigns (lots of times with partners) to be set up, support centers and sales teams and journalists to be briefed, and so on. Knock that out of whack and you get a really confused customer, angry partners, wasted money, and a bunch of writers with no story.
There are a lot of folks behind a product and leaks really screw up all the efforts.
A scary alternative
Part of the reason Nokia has so many leaks is that we are a decent, open, and general good-natured company. We have a very wide network of folks outside the company who work with us in marketing and communications and who help us in testing and distributing products. And we would like to stay this open, though it would be nice to plug some leaks.
The alternative is for us to lock down, send lawyers all over the place, and bug your phone (just kidding on the last one). That would be sad and have negative repercussions on our relationships with everyone. A good review of all we have been discussing was written a few years ago, discussing another manufacturer faced with similar leaks.
Where do we go from here?
We think it’s great that folks are dying to see our devices. Can you imagine if there was a leak and no one cared? Ugh.
Obviously, we’d like to ask folks to do less peddling in our trade secrets. It puts folks at risk and screws things up for the Nokia and for other companies, too. I think really that there are only a small number of folks who really go too far in trying to procure leaked material. But if we cut down on our enthusiasm for leaked materials, then the thrill of being the one to post about it will be reduced.
What do you think? How do we balance openness and privacy as a product manufacturer? How do we keep your interest without giving away all the info before we’re ready? What do you see your role in all this? Am I just a cry-baby or is this a real issue?
Image from platinumblondelife
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- Best of 2008 in Our Business - Product Leaks
- Seeing things for what they are
- Quick link dump of Nokia product related posts
Tags | conversations, e71, NDA, Nokia, Product leak
June 20th, 2008 at 2:28 pm
Coming from the perspective of someone who started out as a blogger and therefore was tasked to locate leaked product images and specifications to share with the world, and now as an employee working for Nokia, I can officially say the turning point for me was confronting a Product Manager of a very popular device on the market today and asking that person what they thought about the fact that everyone has seen what they’ve been working on for over a year and know the specifications as well.
Said person went on a 15 minute tirade that made me want to hug them and since then I’ve not commented on or discussed leaked Nokia products.
Leaks in general do not impact the mass market because the mass market does not read Engadget or Gizmodo or The Boy Genius Report, but at the same time it does jade the final opinion of a product that a journalist or technology savvy consumer would have.
When it comes down to it … this is a difficult question to answer. What components are contained within a device and how the exterior of said device looks, tell less and less of the story of the product.
Nokia knows they’re going to sell more phones in a fortnight than Apple will in a year. The rich user testing that goes on behind closed doors is more valuable than anything else and worth the leaks in my honest opinion.
In fact I would hope Nokia takes their most loyal fans and avid fans of the company and sit them in a room, make them sign NDAs and then ask them for their help in building the next generation of products. It may sound a bit crazy, but I think it just may work.
Jan Chipchase, I love the guy, but why should you have to send him around the world to talk to people and then make him create powerpoint slides that tell product managers what those people want?
Why not let consumers work with creators directly and trust them to hold a secret?
Remember, forget about the device, it’s all about the experience now. Give someone a Nokia N95 with the next version of an OS we’re building internally and ask them to file bug reports and come into monthly meetings.
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June 20th, 2008 at 4:05 pm
A key (external) point missing here is the desire from the outside to have the information. It’s basic supply and demand - here’s an analogy; if people weren’t willing to buy second hand car stereos, other people wouldn’t break into cars to steal them.
There is an increasing desire for information about Nokia products from the outside. That isn’t going to go away, unless Nokia stops producing killer kit. And in fact, you should be quite flattered. That news outlets want to know what’s coming next reflects only the wider passion people have for the products (supply and demand, again).
When it comes to leaks, there are some battles worth fighting and others that are just too far out of your control to even think about taking part in.
Pick the ones you can control and at least you’ll have some chance of stemming the flow.
One thing you won’t ever be able to do is stem the desire. So don’t even try.
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June 20th, 2008 at 4:38 pm
Good article Charlie, with some thoughts I haven’t considered myself in the past. I just posted a blog post linking to this article and look forward to hearing what others think too.
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June 20th, 2008 at 5:27 pm
It’s hard to answer this one myself being a phone blogger.
I know that for the company, leaks aren’t the best thing, while if I see something “worth leaking”, I do broadcast it.
I think it’s up to the company to control products in order for them not to be leak, us bloggers and journalists just try to bring excitement in.
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June 20th, 2008 at 5:48 pm
I’m just asking this because that I’m very curious about this matter,Regarding the E71 hands on review by(I’m not mentioning the name every body knows it)Isn’t that done intentionally to draw more attention,as a pre- release marketing technique.I thought that it was done legally by some Nokia Official him self.
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June 20th, 2008 at 6:09 pm
Nokia shouldn’t worry about doing more than it does to curb leaks.
Yes, it’s a bit much when Boy Genius can do a full review of an E71 before you’ve even announced it, but this is the Internet era — we’re past the point where a company can spend months gearing up its PR campaign in heavy secrecy. Much as with software copying, you should pretty much expect leaks rather than imagine you can stamp them out if you only try hard enough.
Besides, as you noted, leaks generate buzz. If they’re genuine, at least. Teasers and other deliberate clues can actually have just the opposite effect, as they’re often too controlled to be engaging.
One solution if you really don’t like leaks: accelerate your launch schedules! The N96 is an example of the problem: it was announced in February but still hasn’t shipped four months later. Either don’t announce until it’s near ready, or find a way to get the product on the market before it’s old news.
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June 20th, 2008 at 6:09 pm
And also one more thing,What about the pictures leaked of so called devices N79,N85 5800 MusicXpress,right on the iphone 2 release,was that a coincident,If you surf the web this is a hot topic been discussed these days,So why let the folks ruin the reputation of the company?
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June 20th, 2008 at 7:05 pm
A tricky situation, indeed, specifically for individuals such as myself and other bloggers who now work for Nokia (and other companies - leaks aren’t a Nokia-specific problem). While there obviously is a level of traffic benefits from posting leaks, in my experience, those are short lived, and often not worth it in the long haul.
While clearly Nokia and any big corporation is ultimately responsible for this problem on its own, by securing its assets better and educating employees on the impact of such leaks, I think that the external-communications arms at Nokia have a part as well.
The biggest thing, I think, is what Nokia is doing by introducing the world to its product managers. For instance, the E71 is simply a piece of machinery, bits and pieces of various materials put together.
However, watching the video of Arja-Liisa proudly proclaiming to be the Mama of this product, and telling about the things that went into it, we get a better sense of the emotional ties to the product, and I think it ties us emotionally to the PMs.
At least that’s how I feel.
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June 20th, 2008 at 8:40 pm
I hear ya and thanks for making this company view about leaks something to talk about.
With Brighthand, we have a poilcy where if someone knows about a device (therefore under NDA), that person doesn’t even write news postings about it. Its too easy to slip with information in a way that makes the companies involved look bad.
That being said, I really do appreciate it when a company can really keep a lid on devices until just before the release and really do a job with surprising us reviewers. While we don’t get the satisfaction of being privy to new information, we do get to engage in some of the surprise that a new device should do for us all.
To keep interest, and allow a bit of leaks is simply a matter of doing those veiled concept showings and occasional ambassadors of those leaked products to reputable sources. After that, its just up to people involved to respect those corporate lines so that all can win out here.
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June 21st, 2008 at 5:07 am
quit whining. The game has changed since the E61 was released and people are not content with waiting to see what phones their carrier will have for them. Mobile devices are very important and since no one has gotten it right yet, you can understand why people are anxious to see what’s coming out next so as to not waste too much money on over-rated garbage. The E71 leak more than likely will end up saving Nokia a lot of money since the leaks were happening before the iphone and blackberry stories came out. the general public dosen’t know and dosen’t know how to know or care until it’s time. this is your core audience that cares. we are the first to buy and the first to recommend the device to friends, coworkers and family.
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June 21st, 2008 at 7:51 am
First! Um, anyway…very nice job Charlie. That Engadget took the time to take you to task must mean you have something important to say. I know it’s getting to be a trite example around these parts, but somehow Apple is managing to keep a very tight lid on new product rollouts so how is it we cannot do the same. How’s about “If we trace you as the source of a leak you will be fired and then we will pursue legal action.” That might stem the flow, no?
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June 21st, 2008 at 10:24 pm
I feel for the people whose products are leaked. I have a sense of the passion that goes into many of our products, having been involved with a few (non-phone related) in my time at Nokia.
We should certainly do what we can to prevent product leaks. On the other hand, we could figure out how to turn them into something positive instead of bemoaning them. Make lemonade from the lemons, so to speak.
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June 22nd, 2008 at 5:13 am
+1 Stefan.
But not only Nokia does suffer from leaks. Some guys are even selling Sony Ericsson prototypes in public. All that Nokia do is letting only trusty people to test the devices. Getting Bloggers upset with Nokia won’t be a good idea at all - they could completely destroy Nokia’s image on the internet.
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June 22nd, 2008 at 5:17 am
+1 Stefan.
But not only Nokia does suffer from leaks. Some guys are even selling Sony Ericsson prototypes in public. I feel that leaks are a natural part of the mobile culture. Without leaks, it’d be totally boring. Users would always go to the first available product. But, if a better Nokia was leaked prior to a Sony Ericsson, users (the power users) will wait for it. All that Nokia can do is letting only trusty people to test the devices. Getting Bloggers upset with Nokia won’t be a good idea at all - they could completely destroy Nokia’s image on the internet.
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June 22nd, 2008 at 8:33 am
Whenever Nokia’s devices are leaked, mostly the buzz is generated with the N-Series and E-Series. The lower end devices don’t generate much buzz and fade away after the initial leaks.
The main reason for this is that people want to know what new technologies, features, Software & Hardware Nokia is planning to put in it’s Top End devices. They are excited when a device with top of the line features is leaked.
I agree it’s the demand and supply about products being leaked. The more people want to know the more leaks will be there. If a top end device generates positive reactions among the audience, Nokia has got customers willing to upgrade to a better and more expensive device even before it’s launched. So it can be beneficial also to the company.
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June 22nd, 2008 at 12:26 pm
I agree with Stefan, what he suggests doesn’t seem practical in the first go, but makes a lot of sense. This will make for better devices too.
The desire for leaks is a manifestation of a part of us that feels and wants to be a part of Nokia. We want to be ‘in’ on the latest no matter what, be part of the entire product life cycle.
Here is what I wrote immediately after reading this post yesterday: http://url.ie/gr0
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June 22nd, 2008 at 8:29 pm
With so many employees working on any given product, and so much demand for information even on half-finished products, I don’t think leaks can be prevented. Learn to live with them instead. As someone said, leaked interviews are read mainly by tech savvy consumers who are well aware of the fact that the prototype used for the interview is still a work in progress. In these cases, any publicity might well bee good publicity.
The people who leak the information are probably somehow rewarded for their trouble in proportion to how much demand there is for the information. If Nokia wants to intervene in this “black market” for information, it should become a provider itself and undercut the going black market rates for information, thus destroying the market. Similar tactics have been used to good effect for preventing the spread of nasty diseases among intravenous drug users (i.e. easy provision of free, clean needles).
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June 24th, 2008 at 12:03 am
As someone close to this issue for another manufacturer, I applaud the dialogue here.
I’d also like to amplify a consideration that was too subtly addressed: people lose their jobs.
1) It may be fun to socially engineer information from an in-store associate, but those associates are usually tracked down and sacked as are others at other levels who intentionally leak info. For those being disciplined it’s not so much fun.
2) When information is leaked, it essentially takes the wind out of the sails of the sales machine (pun intended). And it is it is extremely difficult and expensive to maintain the “marketing buzz” for a new product in the timeframes when early leaks occur. If enough people stop buying the current version(s) (which may operate perfectly fine for most people), inventory is returned, profits go down, and (innocent) employees get sacked. In other words, marketing by leak isn’t worth the cost. If it was, and you can bet on this, everyone would be doing it.
And then there is the money that is spent tracking down the leakers - that’s money that could be spent making products better.
I’m under no illusions, but less leaking is better for most people, IHMO
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June 24th, 2008 at 4:40 am
With the tight competition nowadays, product leaks makes it look that your company is still in the game. Your users/consumers are being given the advance information and they in turn can decide if they will stay with your brand or jump into another.
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June 30th, 2008 at 11:25 pm
there are a few things that i came up with….
1. if u planned on buying some other phone but you got the leak news and now you changed your mind, well then Nokia wins another customer.
2. if another company starts to copy the work and make their version of the leak, well thats a big loss for Nokia.
3. We at the end of it, we all are humans and we tend to do mistakes. not just any mistakes but mistakes that make history and a place in Nokia Conversations.
this is something that we should learn to live with.
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July 7th, 2008 at 10:00 am
Thank you Charlie for the great post!!
This touches me as well as many other bloggers who “try to abide by the rules”, but the truth is, there are no rules when it comes to blogging. Only rules that the blogger sets for him or herself.
With me, its based on whether you value the relationship you have with the person that is trusting you with information that is given. I’ve been approached on several occasions with unannounced products or services with the intentions of providing feedback or input. Now I know how intriguing it would be to just sneak a pic and post it on the internet to grab readers and comments and pageviews and such, but in return I would end up ruining a trusting relationship. That’s not worth it.
But by the same token, the confusion lies on the fact that it might already be on the internet. Then what? The rules say, that if it’s already on the net then it’s public info. Even still… I dwell on the fact that I would be putting my own reputation on the line by repeating what I’ve seen. That’s when I usually reach out to others (usually within the company) to find out the proper procedure and if that means losing out on a popular post, then so be it.
The end result in this case… I doubt there will ever be a way of safeguarding information especially with a company such as Nokia who is watched closely by its consumers and enthusiasts. But if bloggers could come together in a matter of morals and ethics to the company that they value so much maybe it wouldn’t be so bad. I mean, you don’t need to sign an NDA to know to do the right thing.
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July 14th, 2008 at 9:53 pm
Hi,
Excellent article! But still I’m in doubt! I’m just thinking on some facts related to this leak! Thinking of the timings of those leaks of E71. The pre-launch review was published by the same one who published the first leaked news on E71 in early January! And even the paid publicity managers of Nokia would hesitate to write such an over-praising review as it was written by the pre-launch reviewer! He called it The Best Nokia Ever! Was there any better way available to Nokia to make net-savvy nokia fans wait breathlessly for it’s release? E71 generated more than enough interest, it started selling /shipping within days after the announcement! N96 hasn’t generated that much interest, it was amounced but the release is being delayed! E71 is exclusively for the net-user segment, while N96 is not so!
There are so many methods of sending information to the target customer, like official, and sometimes, not-so-official!
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July 30th, 2008 at 3:37 pm
Companies condemn the leaks, but at the same time they are playing the same publicity game themselves. Look at for example “The Tube”. Small pieces of information, deliberately leaked on different occasions.
Sometimes it is really hard to tell what are real “leaks” and what is just plain old marketing. Leaking is a safe way to give out information, because nobody can hold you accountable for what you have promised - they are just rumors. Maybe they are right, maybe they are wrong. And the company can always deny them.
Even if the information is just a leak, it still has an effect on the customer. If I think that a well known mobile phone company is just about to release a wonderful touch screen device, maybe I postpone my purchase decision a little bit, just to see what they are really up to.
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August 25th, 2008 at 9:56 am
This was interesting to read. It made me come up with an idea.
When you mentioned ‘bugging’ phones…why not? Of course not the phone you actually launch, but why not put a small program or feature in the prototype models that reports to Nokia? It could use GPS where available to report the location of the phone (with an instant alert to Nokia when the product goes outside of a certain area) and/or it could send SMSs or emails every so often so Nokia know when the phone is on.
Seems a bit farfetched, but certainly possible to prevent leaks.
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March 11th, 2009 at 9:34 am
Interesting thoughts.
Products leaks generate good amount of Buzz for a phone but then the enthusiasm fades away for low end devices as some one points out in the comments.
Personally If the Leak is a compelling Device like a Nokia 5800 or E75 . I would publish it to convince readers to stick to Nokia.
1.I know so many readers who skipped the iPhone just to get the 5800 its first Touchscreen from Nokia and Nokia is a very well respected brand in a country like India with over 60-70% market share.
So the leaks helped Nokia get new customers.
2. There are 2 types of consumers
a) restless - Want to Buy It Now Types - A leak is not going to stop them from purchasing a new phone. They pick from whats present in the market.
b) patient and well informed buyers - such consumer dont mind waiting for the next set of phones to arrive. It might be due to fact that they already have a primary phone and are looking for a upgrade / secondary phone whereas the restless buyers dont have a primary phone.
Such leaks can deter the well-informed buyers from making the purchase. and hence the current market devices might get stuck in the market.
Its practically impossible to prevent leaks as the no of ppl involved in the product development is not just a handful of folks.Probably you can stick to CodeNames until last minute .
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charlie Reply:
March 20th, 2009 at 12:16 pm
@Varun, Thanks for the thoughts. This is a very convoluted subject and regularly rears its head.
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