Monday, May 13, 2013

Nokia banks hopes on low-cost Internet gadgets to spur sales

Nokia CEO Stephen Elop and head developer outreach of Nokia, Sangeeta Bavi, display Nokia Asha 501 phones during the unveiling ceremony in New Delhi last week. PHOTO/AFP/RAVEENDRAN

Nokia CEO Stephen Elop and head developer outreach of Nokia, Sangeeta Bavi, display Nokia Asha 501 phones during the unveiling ceremony in New Delhi last week. PHOTO/AFP/RAVEENDRAN 

By CHARLES WOKABI cwokabi@kenationmedia.com

Nokia is banking on fast-growing demand for low-cost Internet-enabled devices in the emerging markets to regain its market share.

In an interview with the Smart Company on Thursday, Nokia global chief executive officer Stephen Elop said the company is placing unmatched importance on emerging markets that comprises Africa, the Middle East, and Asia, given their capacity to grow.

He said the company’s strategy in beating vibrant competition that has been on the rise, especially from South Korean manufacturer Samsung, is introducing gadgets with specific superior features such as long battery life, camera, striking colours, and design.

“We are aware of the competition in the market and we like it because it keeps us on our feet. Our strategy to get back to the top of the game is delivering the best devices at reasonable costs,” said Mr Elop.

Partnerships

The company will also be entering into partnerships with local mobile operators and content producers to offer certain services at promotional rates.

Already, Mr Elop said, Nokia has struck a deal with Facebook to enable phone users with its devices to access the social networking site for free for a particular period of time.

“The emerging markets are our best bet because the number of Internet users in these regions is growing by the day.

“We appreciate that we need to be more vibrant in these markets, not only to sell, but also to understand the needs of the consumers so that we build befitting solutions,” the chief executive noted.

The Finnish company, like many other phone manufacturing giants, has been facing cutthroat competition in the past few years as the uptake of mobile data increases, triggering huge demand for Internet-enabled hand-held devices.

Its rivals, Samsung and Huawei, have had the best of the Kenyan market, currently dominating the smartphone market segment.  

Last week, the phone manufacturer unveiled a new handset in its mid-range Asha series targeting huge sales among the fast-growing number of Internet users in emerging markets.

At a launch held in New Delhi, India, the company said the new Asha 501 is a re-invention of affordable smartphones and targets the over 80 million people in the world operating on the 2G platform.
“We believe the new phone, alongside other range of new products, has a niche market and will help the company recoup lost market share while giving consumers a different experience,” said Mr Elop.

Retailing at about Sh8,500 ($99), the smNokia is banking on fast-growing demand for low-cost Internet-enabled devices in the emerging markets to regain its market share.artphone will be available in the Kenyan market by the end of June. Its arrival is likely to trigger a new wave of competition for the low-cost smartphones market currently dominated by Samsung and China’s Huawei.

Mr Elop, appointed to the company in 2010 to steer the turnaround of the once-dominant phone manufacturer, defended the company’s decision to stick to the Microsoft operating system for its high-end smartphone products despite consumers’ increasing appetite for Google’s Android platform, which is used by its competitors such as Samsung and Huawei.

During the company’s annual general meeting held in Helsinki, Finland, on Tuesday, investors piled pressure on Mr Elop, saying that although the Microsoft OS may be good, it has failed to deliver results in terms of sales and the decision should be reconsidered.

Making more sales

“It is true that our competitors on the Android platform are making more sales but we are confident that with more consumer awareness, the uptake of our Lumia range of products will continue to go up, as has been happening,” noted Mr Elop.

The company also launched a new developers’ platform in what was seen as efforts to woo software developers to make more apps for the Asha model of smartphones.

Developers who come up with applications based on the new Asha platform for the Nokia Asha 501 will reach all Nokia smartphones without having to re-write the code. “We’ve seen a tremendous increase in consumer demand for apps for our Asha smartphones, as witnessed by the growth of downloads in the Nokia Store,” said Marco Argenti, head of developer experiences at Nokia.

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