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Nokia Losing its Cell Phone Dominance
supersandra writes "The Boston Globe is reporting that Nokia is struggling to offer features, such as cameras and flip-phones, that are luring customers away to phones by other brands such as Motorola, Samsung, and Siemens. While Nokia used to account for 1 in every 3 phones sold worldwide, they are down to 28.9 percent. Nokia plans to bring 35 new phone models to market this year to win back more users."
Is it really worth it to have 35 new phone models?
The article says that Nokia's problem is not having features that consumers want, like clam-shell phones. Yet their solution is not to include those features in their new phones, but to offer consumers 35 different models this year (only 6 of those are clam-shell). I'm all about consumer choice, but does this make sense to anyone?
Nokia's phones have recently been designed really poorly, IMHO. They are either too big or have a weird, non-standard design that doesn't always improve functionality.
That being said, for the most part, their GSM phones work better than most of their competitors for call quality and reception, but their competitors are quickly catching up!
Doh!
No, they are down 4.4 percentage points but take (33 - 28.9) / 33 the orignal is the way to find the percentage change which is down 12.42%.
It's 4% of the total market, but it represents a 12% loss within their customer base. Further the Cell phone market base is increasing at a fairly brisk pace, so it represents quite alot in terms of revenue $$$.
Secondly, if you're an investor in a company that was the big player, and you see declines like this, you start thinking of other investment opportunities.
It's a pretty big deal.
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Well, first of all, Nokia has been very successful in the cell phone market, and generally when you have high-quality competing players, the competition kicks in, and things even out. Nokia boasted 34.7% global marklet share in 2003, and in Q1 2004 grew in European region with those new concept devices like N-Gage and what not. Suchy growth is hardly sustainable, especially when competition largely is just as good.
Second, US is a large market for cell phones in regards to global sales. However, few of US customers ever choose their cellphones, since in the United States the phones are purchased by the operator, not customer. Which still creates some sort of competition, but it's way tougher to push newer phones and newer features, while the operator still has the year-old models available and runs those commercial "and now get a free blah-blah-blah phone with the signup for 1-year plan".
Realistically I think slipping to 28.9% is not too big of a deal, and Nokia will kick back after maybe just one sweet deal with US operator like Cingular or Verizon, where new models get pushed.
I loved my Nokia phone. But I wanted it to sync with my computer, and Nokia didn't have any Bluetooth phones for sale in the US. So, I got a Sony Ericsson.
The Sony Ericsson is slow and poor quality compared to my Nokia, but Nokia still only have one Bluetooth phone on the market, and have a ton of stupid designs--circular keyboards, keyboards with two buttons on each key, slanted keypads, and so on. Idiots.
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