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June 20, 2008

Product leaks just lead to trouble & headaches for all

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