Nokia Saved by Shipments Volume in Emerging Countries, But the Future is Uncertain

Nokia’s handset market share rose to 39% from 36%, thanks to a very strong positioning in emerging countries, but average selling prices are down. These gains are partly due to Motorola giving up on competing using price cuts (Nokia’s low-end phones are much better anyhow). However, in the U.S, the number of Nokia handsets sold has diminished by a good margin, and I personally find that worrisome.

Nokia has already warned that the average selling price (ASP) for its handsets went down to 79 Euros (from 83 Euros last quarter) and this is probably not over. To be fair, half of Nokia’s revenues are in dollars, so the currency situation is damaging but (to me,) the loss of share in the U.S is a sign that the company has issues competing on handset design and software. The question is: what happens when the volume in emerging countries decreases?

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