Struggling Nokia eyes up Chinese smartphone market

Nokia CEO Stephen Elop goes on stage for the mobile phone giant's press conference at the Mobile World Congress. Photo / Supplied
Nokia CEO Stephen Elop goes on stage for the mobile phone giant's press conference at the Mobile World Congress. Photo / Supplied

Mobile phone giant Nokia has looked to a launch in China and a cameraphone "revolution" to help it stage a comeback in the fiercely competitive smartphone market after a dismal 2011.

On the opening day of Mobile World Congress, with tens of thousands of industry executives gathered, the Finnish firm said it would push its flagship Lumia smartphone series, that run on the Windows platform, to the Asian giant.

Announcing that Windows phones have now been made compatible with Chinese mobile operating networks, Jo Harlow, who heads the group's smart devices division, said: "That means Nokia will bring Lumia to China."
Beyond eyeing the massive Chinese consumer market, the group also unveiled a new phone called 808 Pure View, which boasts a 41 megapixel sensor technology described by Harlow as a "revolution in smartphone imaging."

The phone, featuring Carl Zeiss optics, allows the user to capture an image before zooming in and cropping or resizing to show previously unseen details.

Its 41 megapixels are also far above the 8 or 10 megapixels available on the market today and even beats many stand-alone digital cameras.

While Nokia mobile handsets were once ubiquitous, the firm has been struggling to secure a foothold in the smartphone market, with Lumia so far failing to reverse falling sales in its overall smartphone business.

In the fourth quarter, Nokia sold just 19.6 million smartphones -- 31 percent fewer than in the same quarter of 2010 and far behind market-leader Apple, which reported 37 million units sold, and runner-up Samsung, with 36.5 million smartphone sales.

The group also posted a net loss of 1.2 billion euros in 2011, compared to a net profit of 1.8 billion euros a year earlier.

Asked if the Barcelona offers would improve the group's results, Nokia chairman and chief executive Stephen Elop said: "The most important thing is that we have demonstrated the action necessary to improve the fortunes of Nokia.

The group is "changing the strategy and executing (the shift) ... With great products and consumers alike, the rest will fall into place," he added.

But the market was not convinced, with Nokia shares plunging more than 6.5 percent at one stage.

An analyst with Japanese investment bank Nomura said disappointment in the launch was likely what was dragging down the Finnish company.

"The company has built up expectations saying it would give significant industry news but we didn't really get any," Richard Windsor told Dow Jones Newswires.

"We were looking for a cheap Windows phone at $200 on a new version of the software. We got a phone at $260 on the old software," he lamented.

But other analysts were more positive.

Francisco Jeronimo, IDC research manager, told AFP: "After Nokia's launch, yesterday's launches by HTC, Huawei and Sony all seem outdated."

Asian giants HTC and Huawei on Sunday launched ultrarapid smartphones boasting quad core processors that give them twice the processing speeds as those currently on the market.

But Jeronimo said a good camera was a better selling point than speed.
"Nokia was right not to go for a quad core. Why do you need quad core? It's like getting a Ferrari.

"When you go into a shop and you see a phone with 41 megapixels, compared to another one which is fast but which only offers 8 megapixels, you're most likely to pick the one with more pixels," he said.

In addition, the group's push into China also opens the doors to millions of consumers, he said.

Even though Chinese brands Huawei and ZTE are traditionally strong in their home market, "Nokia is a strong brand" and the price of the Lumia 610 is a competitive 189 euros before subsidies and taxes.

"That makes it the cheapest Windows smartphone on the market," Jeronimo said.

"Last year Nokia looked worrying. I think this year things will start to look up," said the analyst.

Some models of Nokia's Lumia range will be available in New Zealand from next month.

- AFP

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