Nokia Dials in Fresh Market Outlook

Looking to bounce back after losing market share last quarter, Nokia introduced new handsets at its annual Nokia Connection conference
in Helsinki this week.

In addition, the world’s largest handset maker laid out its business-focused
software plans and updated product releases at the conference.

On the handset side, Jorma Ollila, Nokia’s chairman and CEO, unveiled the
newest 3G phone. Designed to work on a variety of
networks in Europe, Asia and the Americas, the Nokia 6630 offers fast,
secure access to corporate intranets and e-mail.

The company also launched the Nokia 6260 for traveling professionals. It
offers advanced mobile technology features and applications, including
push-to-talk, e-mail, Bluetooth connectivity and a camera
in a fold-up design.

Other new phones in the lineup include: the Nokia 6170, a mid-range,
clamshell-style camera phone; and the 2600 and 2650, affordable phones for
small business owners that have color screens and spreadsheet applications. Along
with the phones, Nokia debuted a mobile keyboard to make entering data
easier.

For software enhancements, Nokia announced the second edition of its Series
60 platform, with improvements for business and beefed-up performance.

Series 60, which runs atop the Symbian operating system, the most commonly
found smartphone OS, is used to create smartphones with large color screens,
a user interface for single-handed navigation and a suite of mobile
friendly applications. Within the Symbian market segment, smartphones that
use Nokia’s Series 60 platform are by far the most widely deployed.

The updated OS includes support for push e-mail, improved data
synchronization and corporate intranet browsing with HTML and JavaScript
support. Secure connectivity will be enabled via IPsec and VPN.

Last week, the research firm Gartner reported good news and bad news for
Nokia. Mobile phone sales grew by 34 percent worldwide in the first quarter
of this year over the same period a year ago, with sales of 153 million
units. While all of the top five vendors experienced an increase in sales,
Nokia’s sales increased by nearly 5 million.

However, its market share declined sharply, falling from more than 34.6 percent
during first quarter 2003 to just fewer than 29 percent in first quarter
2004. Gartner expects the market for mobile phones to hit 600 million for
all of 2004.

According to Gartner, Nokia’s decline resulted from decreased sales in
Western Europe and North America. Ben Wood, principal analyst for mobile
terminals research at Gartner, said, “Nokia’s dramatic drop in market share
resulted from a weak product portfolio and the decision by operators in
Western Europe to source more phones from Nokia’s competitors.”

Material from SmartPhoneToday was used in
this report.

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