RealTime IT News

Coming Down the Tube: Nokia's Answer to iPhone?

Nokia, the world's largest phone maker, is reportedly getting ready to take on Apple and forestall competition with the new Android-powered G1 phone, thanks to a touchscreen-based smartphone of its own.

Next week, the Finnish phone giant is set to debut its new offering, dubbed "Tube" -- marking the latest step Nokia (NYSE: NOK) is taking into the world of higher-priced mobile devices with advanced features. According to a Reuters report, the debut will take place Oct. 2 in London.

But the launch will come just days after a new, closely watch player made its foray into touch-sensitive smartphones. This week marked the long-awaited arrival of the T-Mobile G1 handset, which features Android -- the Google-backed open source mobile platform.

Nokia's own leap into touchscreen phones comes as it's striving drive to reach deeper in the U.S. smartphone market -- which is already enjoying touchscreens, music services and snazzy location-based services on handsets from vendors like Apple (NASDAQ: AAPL) and Samsung. It also marks the latest chapter in Nokia's wider effort to capitalize on demand for more advanced phone features among U.S. consumers.

Nokia, which did not respond by press time to inquiries about its new device, recently launched three high-end unlocked devices in its Nseries line and its first-ever free mobile music subscription service offering unlimited music downloads for a year. The service comes with the purchase of Nokia's 5310 XpressMusic device that debuted back in May.

Geared for streaming video and downloadable music, those Nokia handsets offer a five-megapixel camera and other media-friendly components. They also offer features like a location-aware photo application for what's known as "geotagging" -- noting the location of a photo based on GPS data.

It's not yet clear how promoting such advanced features are playing out for the company. In any event, Nokia has its work cut out for it, particularly in the U.S.

While Nokia commands a huge share of the global mobile phone market -- 45.2 percent of the worldwide smartphone market as of first quarter, according to a recent Gartner report -- its North American presence has been long overshadowed by local leaders that include BlackBerry maker Research in Motion (RIM).

While Gartner said Nokia's first-quarter global market share continues expanding, up 25.3 percent from a year earlier, RIM (NASDAQ: RIMM) is also growing by leaps and bounds. The company's worldwide share now stands at 13.4 percent after a 107.3 percent spike in sales from the first quarter of 2007. Earlier this month, RIM also made a big enterprise play in enabling 43 high-end mobile devices to work with Microsoft Exchange ActiveSync, providing Mail for Exchange access to users.

At the same time, RIM has steadily been pushing its BlackBerry devices into the consumer user space. The company, which dominates the enterprise smartphone space with 54 percent of the market, said yesterday that its efforts to reach consumers is paying off, with non-enterprise customers now accounting for 42 percent of its 19 million users.

Apple's iPhone, meanwhile, continues seeing rabid attention as well -- as of first quarter, it now commands 5.3 percent of the smartphone sales after only 15 months on the market.

So far, Nokia remains optimistic: The company has predicted it will ship 10 percent more mobile devices this year than the approximately 1.14 billion units it sold in 2007.

In addition to music, video and touchscreens, another area of features in which Nokia is aiming to compete is in the slim, but growing, market for high-speed mobile broadband. Its new Nseries phone is for 3G networks -- the same high-speed data network the second-generation iPhone 3G is tied to in the U.S., through Apple's exclusive contract deal with AT&T (NYSE: T).

As Apple has experienced with the launch of its iPhone App Store, Android is also seeing interest from developers interested in creating applications for its platform, which may prove to increase its appeal to carriers and users.

In an effort to compete on the developer front, Nokia earlier this year acquired mobile operating system developer Symbian, in which it already had a stake -- and announced plans to open source the technology to developers.