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Nokia launches Windows smartphone to regain market share

Nokia launches Windows smartphone to regain market share

By Agence France Presse | Updated: 6 June 2012 14:57 IST

Highlights

The Finnish company launched the Lumia 800 and Lumia 710 smartphones, to be rolled out starting next month on selected markets

Nokia, facing fierce competition to remain the world's top mobile phone maker, launched on Wednesday its much anticipated first smartphones using the Windows platform to only a muted welcome.

The Finnish company launched the Lumia 800 and Lumia 710 smartphones, to be rolled out starting next month on selected markets.

The success of the new phones is seen as do-or-die for Nokia, with its market share plunging as smartphone users flock to the hugely popular iPhone by Apple, RIM's Blackberry and handsets running Google's Android platform.

Chief executive Stephen Elop in February announced a radical restructuring and the phasing out of Symbian as Nokia's smartphone software in favour of a partnership with Microsoft.

"Eight months ago, we shared our new strategy and today we are demonstrating clear progress of this strategy in action. We're driving innovation throughout our entire portfolio, from new smartphone experiences to ever smarter mobile phones," Elop said at a Nokia event in London that was webcast live.

"We are very proud of Lumia and everything it represents. Lumia means light; this is a new dawn for Nokia," he added.

Yet the market seemed little impressed as Nokia shares were up 0.7 percent in late afternoon trade on a Helsinki stock exchange also up just 0.7 percent.

Analyst Michael Schroeder of FIM Bank said the launch was "not enough" to help Nokia immediately begin regaining market share.

"No, they need a lot more to stop the slide," he said. "They need broader distribution (of the new phones), they need global distribution before they can start gaining market share," he added.

The Lumia 800 will feature Internet Explorer 9, free voice-guided navigation services and free music and image storage.

It will go on sale in Britain, France, Germany, Italy, the Netherlands and Spain in November, and in Hong Kong, India, Russia, Singapore, Taiwan by the end of the year.

It will reach the US early next year and mainland China in mid-2012.

A simpler version, the Lumia 710, will go on sale by year-end in most of the same markets.
Schroeder estimated Nokia's market share for smartphones at 15 percent in the third quarter, down from 18 percent in the previous quarter, and put its overall market share for mobile devices at around 25 percent, down from a peak of around 40 percent in early 2008.

"I think they will hit a low point next summer ... before they start recovering," Schroeder said.
Helena Nordman-Knutson, analyst at Oehman Fondkommission, said Wednesday's launch was "just the first step."

"Nokia also has to prove that it can sell the phones. But this of course gives Nokia a little breathing room," she told the TT news agency.

Nokia last week posted a third quarter loss of 68 million euros ($94 million dollars), far better than the 321-million loss forecast by analysts.

But the company also reported a 25 percent year-on-year drop in sales and a 39 percent slump in sales of smartphones.

One of Nokia's strategies to regain market share is to sell the Lumia phones at reasonable prices, according to analyst Neil Mawston of Strategy Analytics.

"It's fair to assume that Nokia's margins on these products are somewhat squeezed," he told Dow Jones Newswires.

The Lumia 800 will retail for 420 euros ($585) and the Lumia 710 for 270 euros, excluding taxes.

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