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Nokia’s High-End Cell Phone Strategy

June 27, 2007 in Nokia Randomness

After a reorganization that shifted priorities from crappier, low-end “emerging market” phones to multimedia smartphones, Nokia is back and ready to mess with the US market, among others.

Nokia logo

Nokia’s shift to high-end phones and the US market should put the hurt into some “other” phone manufacturers.

Even though Nokia is the #1 largest global phone manufacturer, with a market share of 36%, in the Land of Opportunity it’s actually playing fourth banana to the likes of Motorola (#1), Samsung, and LG Electronics. To put it bluntly, Nokia has practically zero presence in the United States, although that’s probably because it’s been busy Nokia-fying the rest of the world.

T-Mobile is the biggest carrier/distributor/promoter for the phone maker, and yet, if you take a look at T-Mobile’s 30+ phones, you’ll see that only 5 of them are Nokias – and not exactly N95-quality ones. I mean, come on – the most expensive phone (with a 2 year plan) costs a measly 50 bucks.

To fix the problems with the USA, Nokia is making an attempt to partner-up better with carriers Verizon Wireless, Sprint, and AT&T/Cingular.

As for the rest of the world, the smartphone market right now is still miniscule (smartphones accounted for only 10% of global phone sales) with growing demand thanks to the iPhone and the iPhone’s friends. Generally, high-end phones have better profit margins than the cheap stuff, so by putting the focus on multimedia handsets Nokia’s making a pretty smart business move – especially when you combine that with Nokia’s influence on the entire world.

Final quote:
“If Nokia executes as well in the smart phone market as it has in lower tiers, its rivals have worries.”

Source: “Nokia Pushes High End In iPhone Era” – Investor’s Business Daily

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