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Nokia continues to bank on low-cost smartphones

Source : BUSINESS_STANDARD
Last Updated: Tue, Oct 23, 2012 21:12 hrs
A Nokia executive shows the new Lumia 920 phone with Microsoft's Windows 8 operating system at a launch event in New York

Last week, when Nokia reported its sixth consecutive quarterly loss, it also underlined the company's stronger-than-expected sales of feature phones, labelled as Asha series, across emerging markets. In fact, emerging markets helped the Finnish giant push sales of basic features phones to 76.6 million from 73.5 million in the second quarter.

On the other hand, Nokia's flagship Lumia series shipped just 2.9 million Windows smartphones in the quarter across 15 markets, which did little to halt a 28.6 per cent annual decline in revenue to $9.1 billion. The underlying lesson is that affordability is critical in markets like these (includes India).

In India, Nokia remains focused on servicing the entry-level feature phone and smartphone customers for now. The company announced a new sub Rs 11,000 Windows 7.5 smartphone, Lumia 510, that will make its way across retail shelves in the next 15 days. The low-cost smartphone segment, defined as models with a selling price of less than Rs 8,000, is a strong growth opportunity for the mobile phone industry, according to the new NPD DisplaySearch Smartphones: Displays, Designs and Functionality report. "Low-cost smartphone shipments are forecast to double every year from 2010 to 2016, increasing from 4.5 million to 311 million," cites the report. Nokia may be pursuing the right track, say analysts.

Vipul Mehrotra, Nokia India director and head (smartphone devices), believes budget-friendly Windows Phone devices will give the firm the much-needed market traction against Android devices (priced at Rs 6,000 and onwards). "Our Asha smart-devices are outselling cheap devices from the competition and with the new affordable Windows Phone like Lumia 510, we are hoping to get the attention of young Indian buyers," says Mehrotra.

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