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article imageNokia admits virtual reality isn't booming, cuts 310 jobs

By James Walker     Oct 10, 2017 in Technology
Nokia has announced it's cancelling its innovative OZO VR camera and cutting over 300 jobs involved with its virtual reality business. The company said VR is growing at a "slower-than-expected" pace and it has acted to "optimise" its industry presence.
Nokia unveiled OZO back in 2015, describing it as the world's best virtual reality camera. The $60,000 device was aimed at forward-thinking professional film crews looking to shoot virtual reality content.
Back in 2015, optimism around VR filmmaking was high. Today, Nokia's conceding that demand for VR content from consumers and filmmakers has remained low.
In a statement, Nokia said it is suspending development of the OZO. It cited the "slower-than-expected development of the VR market" in digital media as the reason for its change of heart. The company's now pivoting to focus on its growing portfolio of digital health products, a market it believes it can gain a "meaningful footprint" in.
"Nokia Technologies is at a point where, with the right focus and investments, we can meaningfully grow our footprint in the digital health market, and we must seize that opportunity," said Gregory Lee, president of Nokia Technologies. "While necessary, the changes will also affect our employees, and as a responsible company we are committed to providing the needed support to those affected."
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Nokia anticipates up to 310 of its 1,090 employees will be laid off. The bulk of the positions will be lost in Finland with the remainder coming from Nokia's U.S. and U.K. operations. The company said it has invited employee representations from its Finland business to engage in cooperation negotiations.
Nokia leapt into VR as a way to establish its presence in an emerging industry viewed by many as the future of technology. So far, the VR revolution hasn't taken off though. Development has remained focused on PC gaming headsets and smartphone-based mobile experiences. The filmmakers Nokia targeted with OZO can't yet justify the cost and complexity of creating VR content.
Nokia said it will continue to honour its commitments to existing OZO customers. The camera's development will be put on hold until digital media offers a warmer welcome to virtual reality. In the meantime, Nokia will focus on its digital health and patent licensing businesses. The former was created when Nokia acquired Withings in 2016, giving it access to health technologies that it's now basing its own portfolio on.
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