Others have caught up to Nokia for reasons that are their own doing. The N95 was a great exmaple of them being able to lead in the market. the iPhone however is an even better example of Nokia not being able to react efficiently or fast enough to changing market conditions.
Nokia's main problems stem from the fact of not having a clear product strategy. While its great that they have a bazzilion phones out there. But, that doesn't help if they are in the volume sector as it'll make them no significant profit, period.
1. I suppose simplifying product naming like E,C,X series is a start. But they should look at standardising hardware specs too at some level. I cant imagine the overhead it brings having so many different HW platforms. They should make tier 1,2,3 level hardware base specs and stick to them. Why? Cause it helps in sustaining a platform easier.
2. Nokia has lost the plot on the software side, which is the basic requirement of success these days. Fragmentation of symbian in silly feature packs is a grave they dug themselves. QT is great but I cant imagine how silly it is for them to expect portability, when I keep reading about meego/symbian specific APIs. Look at the hardware of the next expected Symbian3 device. The screen is nHd intead of Wvga(Meego). and that brings parity within their own product lines & if they stick to the silly nHD, they stand to be inferior very soon. I don't even want to go the topic of silly product diiferentiation strategies of the N or the E series.
3. Ahhh.. the wholy grail.. The UI as everyone keeps bickering about. Functional is what i like, but thats not somwthing that would make me recommend a device to a non-geek friend of mine. Symbian touch is about the most clunky UI I have ever seen, its like "inconsistencyRus". Maemo while much better is a case of lacking come common UI design sense. E.g. look at the space wasted by the top bar in all applications, look at the extra step needed to jump between 2 fullscreen browser windows(I installed ShorcutD to mitigate it). A few essential buttons like the N810 or even android would help. But where is that sense? Imagine the difficutly if we had potrait mode, try hitting the menu/close button then.
Bottom line. Nokia needs a consistent, easy and sustainable hardware/software/apps ecosystem or they stand to lag behind in all aspects that matter eventually.
PS: Before anybody thinks of this as a rant. How many of you would recommend a N900 to a friend? I wont, even though I love mine to bits. In fact somehow I cant think of any Nokia phone except the E71/E72 that I'd ever recommend. Doesn't look good to me at least.