Nokia launches new models for India

By SiliconIndia   |   Thursday, 28 August 2003, 07:00 Hrs
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Finland's Nokia took steps to bolster its position as the world's leading mobile phone maker on Wednesday, launching two cheap models aimed at developing markets such as India and Russia.

HELSINKI:The move shows the increasing importance of developing countries, which offer companies billions of new potential users at a time when sales are slowing in markets like Europe, where many people already own mobile phones.

"In coming years, new growth markets will be the key driver for the mobile industry," Nokia chief executive Jorma Ollila said at a news conference in Moscow.

"In fact, when we look at global subscription growth, 80 per cent of it will, in our opinion, come from new growth markets in the next five years."

Nokia also launched a low-cost line of GSM network equipment aimed at countries like India and Russia, where operators shoulder a much higher cost of capital, cover huge territory and must balance network spending with low customer revenues.

Nokia shares, already trading higher ahead of the launches, got a late boost from the news and ended up 4.8 per cent at €14.67, helped by US buying in particular, brokers said.

Nokia said the new 1100 phone model will gradually replace its current 3310 phone and be available around the world in 2003's fourth quarter.

The 2300, which will also have a monochrome display, will be slightly more expensive and will be launched in the Asia Pacific region at the same time. It will reach shops in Europe, Africa and the Middle East in the first quarter of next year.

"I like (the fact) that they are concentrating on the lower tier phones," said Nordea Securities analyst Jussi Uskola, who rates Nokia shares a "buy." "Nokia is the only one who can make healthy profits from these phones."

In New Delhi, Nokia Networks president Sari Baldauf forecast 100 million mobile users in India in the next three to four years, up sharply from only 17 million now. Ollila said the number of users in Russia would top 60 million -- still less than half the country -- by 2008.

Nokia was a bit more cautious in its forecasts for global growth in mobile subscribers, saying the 2 billion figure would be reached in 2008, up from around 1.2 billion now. (Source: Agencies)

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